Grocers have something in store
dubai — Every expat’s dream the moment they hit their doorbell is to rush to the kitchen, cook something ‘quick’, make few calls and wrestle with an idea if you want to order it from the grocery store below your flat or reach to your mobile and spend time taking virtual tour, make online payment and wait for the delivery or wait for your errand boy. The liberty most of us take is even sometime be rude to the delivery boy by saying, how long did you
take? This is despite some of the fringe benefits we enjoy due to our relationships built over years with neighbourhood stores.
These grocers also maintain a credit period for customers who make a payment at the end of the month. However, all these are now challenged as more traditional brands are opting to have virtual presence in order to retain customers. So the million-dollar-question is, will the physical delivery will be faster than your app?
Traditional stores might adapt to more online avenues but the stores are here to stay Faizal Abdulkarim, Founder of Creative Basket
Traditional groceries/supermarkets are adapting to new business conditions launching apps, opting for new online avenues and yet retaining its loyalty to its customers by racing against all the challenges. The idea is to retain the customer base.
Faizal Abdulkarim, brand marketing consultant and founder of Creative Basket, said: “The neighbourhood stores will always remain as the residents enjoy a lot of fringe benefits. Also the durability and price factor differ a lot from online and physical stores. The traditional stores might adapt to more online avenues but the stores are here to stay.”
A normal store receives almost 200-250 calls everyday to run errands for the residents in the near by vicinity. More and more families base their home renting/or buying preferably based on grocery stores in the region, informs a customer service official from a popular supermarket. A closer look at Dubai based app el Grocer — which assures the delivery within one hour — shows its key partners are Al Maya, 7 eleven, Lifco among other popular brands. Al Maya Group, the UAE-based business conglomerate, has more than 50 supermarkets in the GCC countries in addition to other businesses.
Kamal Vachani, group director, Al Maya, said: “We will open five supermarkets by December 2017 and we have already opened two this year one in Abu Dhabi and one in Karama.”
The latest to join the bandwagon of launching online operations in the UAE is the popular brand Al Adil, which launched its online operations on Sunday this despite having its vast presence across the GCC. Dr Dhananjay (Jay) Datar, chairman and managing director Al Adil Trading Co, said: “Customers today have become digitally savvy. Nowadays anything and everything is bought online. We want to meet this need in the right manner
We will open five supermarkets by December 2017 and we have already opened two this year one in Abu Dhabi and one in Karama
Kamal Vachani, Group director, Al Maya Group
and our online store is well equipped to meet the growing demand of people for authentic high quality Indian food stuff. With full confidence I can state that we will be able to extend the same level of support and high quality Indian foodstuff for customers who want to shop from wherever they want.”
There are more than 2,800 groceries in Dubai and the number is increasing. These groceries are suppose to upgrade their standards as per the directives of The Dubai Economy and new standards for licensing groceries in the emirate.
The Dubai Economy expected 20 per cent of the grocery stores to comply with the new standards by the end of 2016, and the remaining 80 per cent to complete the transition by 2018.
The Alpen Capital’s latest research on GCC Retail points out that online shopping is gathering steam in the GCC, particularly in the UAE, as signalled by the proliferation of several online grocery and food delivery platforms. Penetration of the modern grocery outlets is high in Bahrain and the UAE at 65 per cent and 62 per cent, respectively, and lowest in Kuwait at 45 per cent. Penetration rates in the other GCC countries range between 52 per cent-56 per cent. Large local and international retail groups dominate the modern grocery market in the UAE. Hypermarket brands such as Carrefour (through Majid Al Futtaim) and LuLu accounted for 35 per cent of the grocery market in 2016. The other major retailers include Spinneys, Choithrams, Al Maya and Al Safeer. Some of these large retailers continue to expand in the country as well as the larger region. Carrefour is expanding its presence in Dubai with the planned opening of eight supermarkets and two hypermarkets in 2017.
The UAE’s internet penetration has hit 96 per cent and it is evident that popular brands are now competing to make the most of it by tapping e-commerce options and yet retaining the traditional approach. With spread of digital devices and increasing number of people connected over the internet, several retailers in the GCC are exploring the omnichannel business model, mainly in the grocery, apparel and footwear segments.
— sandhya@khaleejtimes.com