Over the past decade, the UAE has grown to become a leader in the e-commerce sector across the GCC. According to market research firm Frost & Sullivan, e-commerce in the Gulf Cooperation Council (GCC) was $ 5.3 billion in 2015 and provided 0.5% of the total domestic output of the Gulf States. At the time, the UAE e-commerce sector was valued at $ 2.5 billion, which means that almost half the sales were in the UAE. In the coming years, the GCC ‘s e-commerce sector is expected to quadruple and the sector in the UAE will be worth about $ 10 billion.
Looking at these numbers may at first glance mean that e-commerce in the UAE is not in the modern sector. But in fact, just 10 years ago, the sector looked quite different. This week, we will highlight how the e-commerce sector in the UAE is growing to become today and what the future of this sector in the UAE is.
Evolution of E-commerce
The UAE has always been the initiator in adopting the latest economic trends in the GCC region and the Middle East and North Africa in general, and this applies specifically to technical matters. With the spread of e-commerce in the mid-seventies, the UAE was quick to study this phenomenon and in 2010 there were many companies that entered the sector in the UAE market. This relatively rapid growth was followed by several factors, but the key factor is that the UAE has a number of consumers quickly accepting the idea of paying online, as well as many local e-commerce companies that have been developed to cover the region’s business or small space.
At this time, sites like Noon.com, Awok.com, Souq.com, Mumzworld.com, Letstango.com, and neusouq.com have had a significant impact on the UAE e-commerce sector.
In 2011, the sector grew sufficiently with little concerns about online payment and confidence building in the e-commerce sector. In August of that same year, 69% of the respondents were more comfortable using credit cards at the time of payment, and 7% were more comfortable buying from local stores.
One of the main reasons for the success of e-commerce in the UAE is the commitment of government agencies to support this global sector in the local market. For example, the Dubai Electricity and Water Authority (DEWA) has announced that it has received 50% of the growth in the use of its platform by consumers by 2011.
E-commerce in the UAE
Today, the use of the Internet and smartphones in the United Arab Emirates has helped reach new heights in the e-commerce sector. According to new research from Google, the UAE leads the use of smartphones around the world by 73.8%, and the use of the Internet among the population of the country up to 91.9%.
This high percentage of Internet access has been translated into a huge number of online shoppers in the UAE. At least one out of every three residents in the UAE makes at least one purchase per week, according to one UAE financial source, which rises to 1 in 2 when it comes to Dubai.
The most profitable part of online sales is consumer electronics, computers, and jewelry (including watches). Buying clothes online has also become widespread in recent times.
As mentioned above, the growth of the e-commerce sector is not only driving the growth of the private sector, but the smart government is seeking to benefit from this approach to better communicate with consumers. As for the region in general, we see a shift from the traditional methods of services when it comes to visas and transactions, for example, to digital platforms and integrated with electronic payment platforms, which provides residents with a lot of burdens and facilitate the services in general.
In the year 2016, the Arab Union for e-commerce, which includes 14 governments from the Middle East and North Africa (including the UAE), was established to develop the e-commerce sector in the region. This year, the federation launched a five-year strategy focusing on growth in the region’s e-commerce sector from $ 20 billion in 2017 to more than $ 200 billion in the early years after 2020.
With some developments in labor legislation in the sector, such as allowing companies to operate e-commerce in free zones and improving export and supply processes and pricing, the UAE is well placed to benefit from this sector further to further growth and continue to lead the region in the e-commerce sector.
As local governments continue to develop and support all investment in innovation and innovation, e-commerce will continue to grow. With the UAE at the forefront of this growth, the future of e-commerce looks brighter than ever before with the UAE celebrating the 47th National Day.
Some of The Top UAE E-commerce sites
Launched in January 2017, Noon.com is considered to be one of the biggest e-commerce platforms in GCC. Noon, a project of Emaar Properties, has unveiled the largest e-commerce platform and has more than 20 million products with investments of up to $ 1 billion.
The company’s headquarter is in Riyadh and have more than 10 million square feet of storage space, including the Logitech Ordering Center at Dubai World Central, one of the world’s largest orders processing centers with a capacity of over 3.5 million square feet. Similar centers are built in Saudi Arabia and the rest of the region at the earliest opportunity.
Souq.com is the largest e-commerce site in the Arab world and has over 400,000 products from various categories including electronics, fashion, household products, watches, perfumes, and others.
Souq.com today, attracts more than 23 million visitors per month and is growing rapidly due to the increasing number of shoppers online in the Arab world.
Souq.com which has been acquired by Amazon and news has it that the name might be changed to Amazon.ae in the coming months, which works as a retail addition to his work as a market for vendors from third parties. It offers convenience and safe shopping experience with the possibility of online payment, payment in cash upon receipt of goods, and the possibility returned their products free of charge.
Awok.com is a platform for online shopping in the United Arab Emirates, a site to sell electronic Amoad and products at competitive prices, Ulugbek Yuldashev was founded in April 2013, where he began his activity in the sale of electronics and tools and then his business has expanded to all over GCC. Awok deals in sales of electronics products, health and beauty, household appliances, jewelry, and many more such items with the addition of more and more products on the site daily, and now Awok became the second biggest platform of e-commerce in UAE.
Mumzworld is a leading market in the e-commerce sector, the largest regional site specializing in motherhood and childhood products, with 85% market share in this sector. The market for women in the region is about $ 350 million, Which targeted the mother, was a virgin market, before Mumzworld was able to capture it effectively and quickly.
LetsTango.com, one of the leading e-shopping site is established by Dikran Tchablakian, also the founder of one of the largest IT stores in the UAE and the region as a whole. LEtstango offers you more than 20 years of retail experience through Tango.com. Their motto is to do it different and better!
Lets Tango.com offers you a safe, secure and very easy to use shopping environment to access a great shopping experience. They designed their online store with customers convenience in mind.
Letstango offers a variety of convenient payment methods, including payment on delivery by credit card withdrawal on delivery. They also guarantee fast delivery on the next day of delivery through free delivery within the UAE for all orders over AED 100.
Neusouq is a reliable online shopping site emerging in UAE they lead in e-shopping with a wide range of customers throughout the UAE, they have a wide range of different products so that customers can make a larger selection of products. Neusouq offer 24/7 customer service. Neusouq is an emerging online shopping site trusted in the United Arab Emirates.
What does the growth of e-commerce mean to you over the past 10 years? Have you benefited from this remarkable growth in the sector? if you want your website to be listed please send an email at firstname.lastname@example.org.