UAE E-Commerce Market Forecast To Reach $9.2 bln
According to research from the Dubai Chamber of Commerce, the value of the UAE e-commerce market is forecast to hit $9.2 billion in 2026, while the sector's percentage of overall retail sales in the UAE is expected to hit 12.6% in the same year. Released in advance of GITEX Global 2022, the study used data from Euromonitor to illustrate the many drivers of growth in the UAE's e-commerce sector. In 2021, online retail sales in the UAE grew dramatically, from $2.6 billion in 2019 to $4.8 billion.
Why choose an e-commerce business?
In 2014, the mobile retail market reached $2.6 billion, accounting for 44% of the total value of the e-commerce market. This was primarily due to the rise in popularity of shopping on mobile devices like smartphones and tablets. Between 2022 and 2026, the global market for mobile retail is projected to grow at a CAGR of 15.6%, to reach $4.6 billion.
The research shows that the United Arab Emirates has the highest weekly rate of online purchases, with more than one third of consumers making at least one purchase every week using their smartphone.
According to the study, the rising popularity of online shopping in the UAE can be attributed in part to the proliferation of loyalty rewards programmes offered by retailers, as well as the convenience of using mobile devices to make purchases.
The report found that shoppers in the UAE favoured domestic shopping sites over those of international companies. The majority of e-commerce sales in 2021 came from domestic sites, at 73%, while sales from overseas sites amounted to only 27%.
Despite consumers apparent preference for domestic online marketplaces, the report predicts that competition from international e-tailers will intensify in the near future. Growth of 19.2 percent is projected for international e-commerce sites between 2022 and 2026, which would translate to a 34 percent increase in market share.
Evaluation of the UAE Online Shopping Market
As more and more e-commerce companies establish themselves in the United Arab Emirates, the growth of the industry there has been exponential. The global reach and rapid growth of the digital economy are bringing it to all areas with reliable internet service. Numerous participants in the UAE's e-commerce market are expanding there to meet rising local demand.
E-commerce in the country has seen a boost thanks to the COVID-19 pandemic. Online distribution of food, consumer electronics, and other necessities has been accelerated by the social isolation imposed by the pandemic. Many micro, small, and medium-sized businesses (MSMEs) have made the transition to digital platforms as a direct result of the pandemic. In 2021, for instance, the UAE government launched a programme called Operation 300bn. The goal of these operations is to strengthen the UAE's manufacturing sector so that it can better stimulate the country's economy.
Increasing demand from consumers is the primary force propelling the e-commerce industry in the United Arab Emirates. As a result, companies operating in the international e-commerce market have begun setting up shop in the country. For example, in May of 2022, INC Group, an interior design and fit-out firm based in Dubai, was announced as a subsidiary of INC.
The E-commerce Market in the United Arab Emirates has seen the emergence of a number of new, prominent players in recent years. In December 2021, for instance, Nutshell, a natural peanut butter startup based in Lebanon, expanded to the United Arab Emirates to broaden its reach and capitalise on the country's burgeoning e-commerce market.
The e-commerce industry in the United Arab Emirates has expanded greatly in recent years. The increase in smartphone and internet penetration are among the primary drivers of its e-commerce growth.
By looking at the customer's behavior, retailers found that localization and language are significantly essential aspects to consider when entering the UAE e-commerce market. Many Luxury brands have launched their site in Arabic to attract local buyers who have sidestepped e-shopping due to language issues.
What is an E-Commerce business?
Like any traditional business, there is an exchange of goods or services in an e-commerce business. But in an e-commerce form of business, it takes place through the internet. They're mainly two forms of an e-commerce business:-
B2B - is mainly concerned with the products or services that are crucial for others businesses.
B2C- Business to a customer means the service or the product targets the end consumer directly.
How to start an E-Commerce business?
In order to run an e-commerce business, you need to build relationships and sell information, services, and goods over computer networks. Most of the time, e-commerce means trading goods and services over the internet. This means that more economic activity is happening. E-commerce development includes both business-to-business (B2B) and business-to-consumer (B2C) transactions, as well as organization-to-organization (I2P).
The study also looks at the key market parameters, the factors that drive growth, and the biggest companies in the industry. This helps to back up the market estimates and growth rates for the United Arab Emirates over the next few years. The study also looks at how COVID-19 affects the ecosystem as a whole. The report looks at market size and forecasts for both B2B and B2C channels, with the B2C channel being further broken down by application. To know more contact an E-commerce development company in Dubai.