The growth of mobile technology is emerging as a next-generation medium for retail and marketing. This can be attributed to the improved user experience; a significant increase in online shopping traffic, and the growing popularity of m-commerce. In UAE, the surge in e-Commerce and m-Commerce within the UAE market has led to its adoption by several people and by local businesses for outsourcing their online sales. Mobile commerce will outpace non-mobile commerce in the coming years which assures the bright future of mobile commerce.
The Retail E-commerce market in the UAE touched a record 3.9 billion USD in 2020. This was a 53 % year-over-year increase that was mainly driven due to the Covid-19 pandemic. E-commerce businesses accounted for almost 8 percent share of the retail market in the same year.
What is M-Commerce?
Carrying an entire retail outlet in the pocket is not an imaginary talk about the future. This is currently happening through mobile commerce or m-commerce and will definitely support the future of mobile commerce. In simple words, it is the online commercial transactions made via wireless handheld electronic devices like tablets and smartphones. M-Commerce is not considered a separate entity from e-commerce. It is a specific sub-group of eCommerce transactions that are designed for smaller screen sizes. It is designed to provide personalized business shopping experiences to customers using their mobile to do their online shopping.
In today’s digital marketing world, eCommerce has taken up an important role to provide the best shopping experiences on any device. M-commerce is the mobile commerce trend that is getting more popular day by day. With the increasing use of smartphones and tablets, this form of digital commerce is gaining popularity among mobile shoppers who are looking to buy products through their personal handheld devices.
Mobile e-commerce gives online shoppers a chance to buy products while they have nothing specific in mind or when they don’t have access to their laptops or desktops. This method of making purchases without requiring a desktop computer gives consumers ease to shop right from their phones or tablets without any limitations anytime, anywhere.
M-Commerce in the UAE Market
The growth in the UAE eCommerce market has been accompanied by the rise in various modern technologies such as smartphones and near-field communication (NFC). The availability of apps for every aspect of daily life, such as payment platforms, is increasing smartphone users’ internet usage. Furthermore, eCommerce came up with multiple innovations such as personalized shopping experience by using social media; enabling shoppers to get more information about products and services; increasing efficiency for business owners by allowing them to precisely target their audience; etc. These factors have led to the soaring eCommerce market share in the UAE from 10% in 2013 to nearly 50% in 2020.
Facts and Figures about M-Commerce in the UAE
According to many surveys, most Emiratis say, smartphones have become part of their daily life; and they feel their dependency is increasing every day. According to a survey done in 2019, there are about 96% smartphone users in UAE compared to 71% laptop/desktop and 28% tablet users. The most preferred device for internet usage by the people of the UAE is the mobile phone. However, modern hi-tech phones have transitioned from simple texting and talking devices to mega personalized retail outlets for shopping enthusiasts.
The UAE eCommerce market is expected to grow at a CAGR of 15% in the next six years; as people across the region started to shift towards online shopping after the outbreak of the coronavirus. In 2021, the UAE eCommerce market climbed 6 steps ahead and was the 24th largest eCommerce market in the world. The growing number of Gen Z generation of online customers and the availability of high-tech telecom infrastructure are quickly increasing the growth of the eCommerce industry in the Gulf region and particularly in Dubai.
The UAE and Dubai city, in particular, remain the major hubs for e-commerce growth in the MENA region. E-commerce has been predominant during the COVID-19 outbreak; and many retailers have put much effort into building, improving, and promoting their online shops. Although there are some challenges in the e-commerce market with high costs of picking, packing, and delivery, experts believe that it will improve in time as retailers improve product details, customer support, and visualization.
Future of E-Commerce in the UAE
The UAE is considered to be one of the fastest-growing eCommerce markets in the world. Its worth has been estimated at billions of dollars and this number is only expected to rise further. The country has transformed into a digital hub by providing access to high-speed internet to all its citizens. Along with other factors, these elements have led to a rise in the popularity of online shopping.
The UAE is a rising star in the region and has put itself on the map as one of the top e-commerce markets. The wealth of local companies, a rapidly growing middle class; and an innovation-friendly environment have helped to boost e-commerce in this country. One study revealed that there are more than 1 million online shoppers in the UAE alone. This makes it an ideal time for both foreign and local businesses to explore different avenues for e-commerce growth.
Optimization of the Supply Chain
Having a good supply chain system is critical for the success of any e-commerce venture. Technology investments and process improvements along with developing the necessary infrastructure and manpower have helped to manage these businesses successfully. Proper planning and a smooth flow of operations are key to achieving the desired outcomes. A good long-term strategy and collaboration with delivery partners have also helped e-commerce businesses to grow rapidly in the UAE. Good infrastructure like the well-connected network of roads, warehouses, airports, seaports, and a strategic location of the country, has further boosted the e-commerce businesses in the UAE.
The UAE is one of the most successful markets for e-commerce in the Middle East. Dubai accounts for the majority of online shopping transactions in the region, with a total market value of $617 billion. The UAE’s digital penetration and rapid growth have enabled it to become a global retail hub, where some brands are even moving their headquarters to this part of the world due to its high internet connectivity, tax relief, and ease of doing business. The growth of digital marketing, content strategy, and new SEO techniques have helped e-commerce businesses to market well and grow their businesses in the UAE. The future for such businesses looks brighter as more and more customers are preferring the ease and convenience of online shopping through mobile commerce.