Online retail disruption revolutionising shopping
PwC report outlines key investment areas that will be in the minds of regional retailers in making investment decisions in the near future
MUSCAT: The retail sector is witnessing game-changing developments, with industry players entering the Middle East’s retail market, according to PwC Middle East’s latest report: “Retail Disruption—what’s the outlook for the Middle East?,” released on Monday.
The report interviewed over 24,000 people across five continents in 30 countries. In the Middle East alone, PwC surveyed over 1,000 online shoppers across the United Arab Emirates (UAE), Egypt and Saudi Arabia about their shopping behaviours and expectations.
Full of opportunities
Norma Taki, retail and consumer partner at PwC Middle East, commented: “Our findings tell us that the face of Middle Eastern retail is indeed changing and it is a ripe market full of opportunities. The appetite for investing in online retail continues to grow with high profile acquisitions from heavyweight players, such as Amazon and Souq.com and JadoPado.com, along with the anticipated launch of Noon, which is due to have a big impact on the region.”
“With the online retail landscape changing on a daily basis, retailers and investors need to truly understand the dynamics behind these changes. We are seeing an increase from 23 per cent (2013) to 29 per cent (2016) in consumers shopping online on a monthly basis,” she added.
According to PwC, there are several reasons why consumers prefer to shop online, survey respondents indicated it was mainly because of lower prices (40 per cent regionally vs. 36 per cent globally), product selection (31 per cent regionally vs. 21 per cent globally), and conveni- ence (17 per cent regionally vs. 36 per cent globally).
Retailers are learning to navigate what is one of the most competitive landscapes in decades, with preferences shifting to online shopping.
The report outlines key investment areas, which PwC says will be top of mind for Middle Eastern retailers making investment decisions in the near future:
Mobile
The use of mobile as a shopping and purchasing device continues to surge in popularity. Since 2016, there has been a 17 per cent increase in the rise of shoppers paying for items via their mobile, with 56 per cent of shoppers using their mobile device as their main tool to purchase items. Nearly 43 per cent like to use it to compare prices with competitors, while 33 per cent checked reviews about products and retailers, which was up 11 per cent from 2016.
Those seeking to grow their online retail presence need to optimise their mobile offerings by focusing on designing mobile sites that can be easily navigated to make online mobile shopping an effortless and enjoyable experience. For years, large multi-national retailers have been using a variety of technologies to gather data on customer movement in-store. And yet, social media is vastly becoming the most attractive tool for online engagement.
Social media is in fact driving customer behaviour with 48 per cent engaging in online promotions and 52 per cent using social media channels to check product reviews. The risk of cyber breaches and data hacks are affecting all industries across the globe.