High Noon for online shopping in the region

▶ Launch of e-tailer the latest step in the economy’s digitisation

It seems that 2017 will be a watershed year for online shopping in the UAE. After a long period of silence, Noon, the US$1 billion e-commerce startup backed by Emaar Properties chairman Mohamed Alabbar, finally opened for business in the UAE, selling a range of goods that includes electronics, groceries, fashion and home and kitchen products.

Noon’s launch in the

UAE – to be followed by a Saudi launch in the coming weeks – comes exactly a month after the sale of Amazon products in the country for the first time via Souq.com, which Amazon acquired in March.

Neither service is going to put the country’s bricksandmortar retailers out of business any time soon, given the centrality of malls in the UAE’s social and economic culture. Old shopping habits are unlikely to change overnight.

But the arrival of two heavyweights like Noon and Amazon promises to kick-start e-commerce in a big way in the region; BMI Research forecasts that the region’s online retail market, while still small compared with the rest of the world, will double in size to $48.8bn by 2021.

Noon is not going to put the country’s bricks-and-mortar retailers out of business any time soon

Retail is just one sector in the UAE’s economy that is undergoing a transformation as a result of disruptive digital technology.

Mashreq yesterday announced the launch of its online-only Mashreq Neo banking service, targeted at millennials, which does away with the need for physical branches and branch staff.

Abdul Aziz Al Ghurair, the bank’s chief executive, last month said the bank plans to shed 10 per cent of its workforce over the next year.

Du and Etisalat have also launched digital-only offerings, in the form of Virgin Mobile and Swyp respectively. Such services are designed not only to appeal to young and digital-savvy customers, but also to see whether such digital-only products can point to savings elsewhere in the telcos’ business lines.

Such a trend will significantly affect jobs, with consequences still yet to be determined, both in the Middle East and beyond. But for now the region’s customers can celebrate the launch of Noon and other services that promise a more convenient and less expensive shopping experience.