JEDDAH — Aggressive marketing strategies by retailers have seen Saudi families splurge massively on consumer goods and depleting their budgets too quickly, a financial expert told Al-Eqtisadiah business daily. Four years ago, said Zaid Al-Rommani, Saudis used to dedicate a third of their salaries to Ramadan shopping, but a consumerist mentality bolstered by aggressive marketing strategies has driven their Ramadan expenditure up to 60 percent of their monthly income. Al-Rommani, an economic consultant who works at the Imam Muhammad Bin Saud University in Riyadh, warned that aggressive marketing strategies, including buy-one-get-one-free deals and heavy discounting, have deceived families into thinking that these are opportunities that must be taken, while in reality many of these purchases are surplus to requirements. He said: “In less than a day, a product is fully sold out. “The original price is not the real price, and the retailer that offers buy-one-get-one-free offers is profiting more than 100 percent because the retail price is nearly 100 percent greater than the price at which he originally procures the product. “Many retailers take advantage of the absence of oversight mechanisms. You find the same product sold at prices that vary greatly depending on the supermarkets.” Ramadan, according to Al-Rommani, exposes the widespread price inflation present throughout the year. Some retailers take advantage of the lack of governmental regulation to inflate prices, Al-Rommani claimed, adding that the consumer is being kept in the dark about the true prices of goods. Al-Rommani added that a Saudi family's budget already takes four major hits. These include summer traveling, social events like weddings, Ramadan and Eid shopping, and the start of the new academic year. Many people prepare for Eid in the final 10 days of Ramadan, Al-Rommani stated. Shortly thereafter, families prepare for the new academic year. These four factors hit family budgets heavily and it should be of little surprise that many families complain that they have low incomes. The family usually resorts to taking out loans and therefore nearly 80 percent of Saudis are burdened by debt. A study found that Saudi families spend approximately SR150 billion on Ramadan shopping, a statistic that Al-Rommani found worrying. He said: “If the statistics are true, SR150 billion is equivalent to the budgets of whole countries. I think we really are in trouble.” Sami Nawwar, official spokesman of the Jeddah municipality, told Al-Eqtisadiah that the municipality works all year round to monitor prices, not just during Ramadan. Nawwar added that the municipality accepts citizen complaints on the number 940 and they are referred to the concerned departments. The citizen will receive a text message with the number assigned to his complaint, Nawwar said, adding that the municipality performs surprise inspections after coordinating with other authorities responsible for monitoring retailers. Nawwar explained that the majority of complaints made to the municipality are reports of expired goods, unhygienic conditions, improper storage and goods displayed in the sweltering heat. Nawwar revealed that the municipality is now busy developing “Rasid”, an online monitoring system. Nawwar called on all citizens to cooperate with the municipality by staying vigilant and reporting any violations they witness.
