Souq tiptoes with Amazon into the UAE

▶ Range of goods does not overwhelm but still a positive development

The availability of Amazon-branded goods on Souq.com is a huge moment for consumers in the UAE – especially those who need a new iPhone cable.

The Souq co-founder Ronaldo Mouchawar recently announced that items from the AmazonBasics range – Amazon’s own branded line of goods first unveiled in 2009 – would be available via Souq’s website, offering a “great selection of best in class products at very affordable prices”.

Truth be told, that selection is a bit on the small side, and unlikely to set UAE customers’ hearts aflutter any time soon. Just 57 AmazonBasics items are available for sale via Souq, a far cry from the over 1,000 items available in the range carried by Amazon in the United States. Of those 57 items, more than half of those are cables, readily available in your nearest mall, cut-price electronics shop, or, indeed, from Souq’s existing product range.

But even this small number of Amazon-branded products is a significant step for the region’s e-commerce sector, representing the most tangible benefit yet to come from Amazon’s US$580-million acquisition of Souq in March.

True, it is a small step, one

In spite of the best efforts by Souq and others, online shopping is still in its infancy in the UAE and wider Arabian Gulf region

that will not affect most customers’ lives too much. But the availability of additional AmazonBasics products, which in the US include items as diverse as batteries, bed sheets, umbrellas and camping equipment, is all but inevitable, offering further choice to customers. Hopefully additional items from Amazon’s vast catalogue will follow soon.

In spite of the best efforts by Souq and others in recent years, online shopping is still in its infancy in the UAE and wider Arabian Gulf region. The consultant AT Kearney estimates that e-commerce represented just 0.4 per cent of GDP in the GCC at the end of 2015, compared with 2.2 per cent in Japan and 3.5 per cent in the United Kingdom. Such is the case despite high smartphone penetration and disposable incomes, particularly in the UAE.

But the recent entrance of Amazon into the region, along with the highly anticipated launch of Mohamed Alabbar’s e-commerce start-up Noon, scheduled for later this year, can only have a positive and transformative impact on the region’s retail sector and upon consumers’ lives, even if the impact is, for the moment at least, felt most by those in need of a pink iPhone cable.