REGIONAL E-COMMERCE PLAYERS CLIMB ABOARD MEGA-SALE BANDWAGON
▶ Home-grown online shopping players now host White and Yellow Fridays in US-style promotions, offering special bargains for limited periods
E-commerce players in the Middle East are borrowing a page from the playbook of online giants in the West and Asia with events such as White and Yellow Fridays. Amazon-owned Souq.com’s White Friday this week allows customers across the Arabian Gulf and Egypt to avail discounts of up to 70 per cent. Noon – the Middle East’s home-grown digital marketplace – has unveiled its first Yellow Friday, running through Saturday.
Billionaire businessman Mohamed Alabbar got the ball rolling in 2017 by unveiling the $1 billion e-commerce venture in partnership with the Public Investment Fund, the Saudi Arabian sovereign wealth fund. “With the customer at the centre of everything we do, White Friday deals, for example, are customised for each country, bringing customers the products and brands that they are most looking forward to, at great prices,” Ronaldo Mouchawar, co-founder and chief executive of Souq.com, told The National.
Over the past year, Souq.com has been able to bring more than 1 million products from Amazon for customers in the UAE and Saudi Arabia. Revenue from Middle East and Africa e-commerce is projected to reach $18.6 billion this year, according to Statista. Sales are slated to grow 8.1 per cent a year to reach $27.4bn by 2023. “This year is our biggest ever [White Friday sale] with 2 million deals – four times the number of deals we had in 2017,” said Mr Mouchawar.
Souq.com is offering its customers access to more than 4,000 selected Black Friday deals from the Amazon Global Store, which are ready to be shipped to the residents of the Mena region. In 2017, it had seven times more new customers during the White Friday compared to any average day. The number of units sold were twice compared to the previous year’s White Friday sale.
Souq.com’s customers can also take advantage of discounts on Cyber Monday (November 26) that follows the Thanksgiving holiday in the US.
The Middle East e-commerce market is increasingly competitive as the number of players rises. The regional market is set to grow by 16.4 per cent over the next three-and-a-half years in terms of e-commerce sales, according to a report by Fitch Solutions.
“We see a huge surge in sales of electronics and home appliances during Black Friday and the momentum will continue to Cyber Monday,” said Ulugbek Yuldashev, founder and chief executive of Awok.com. “We see a tremendous surge in our sales and this year. We are expecting it to increase by almost 100 per cent.”
This year, Awok.com has come up with a concept called Black November, where it is providing discounts of up to 90 per cent throughout the month. “Offers for a limited period under internationally known shopping festivals are gaining momentum in the UAE as shoppers wait for discounts and exclusive deals from the e-commerce companies,” said Mr Yuldashev.
There are several reasons why Middle East consumers prefer to shop online, according to the consultancy PwC. Respondents to one of PwC’s surveys indicated they were shopping online mainly because of lower prices (40 per cent regionally vs 36 per cent globally) and product selection (31 per cent regionally vs 21 per cent globally). PwC surveyed over 1,000 online shoppers in 2017 across the UAE, Egypt and Saudi Arabia about their shopping behaviours and expectations. “Regional e-commerce companies are adapting to international trends to meet the demands of local customers,” said Greg Sewastianowicz, chief marketing officer of Namshi, an online destination for fashion and lifestyle. Emaar Malls, a unit of Emaar Properties, owns the majority of Namshi. “Moreover, with growing competition, companies are left with no choice but to participate in key e-commerce moments. Shoppers in the Middle East are very price conscious, so they are definitely happy to spend much more during promotion periods.”
Deep internet penetration is one of the top facilitators in e-commerce growth in the region. It is 64.5 per cent in the Middle East against the global average of 54.5 per cent, according to Internet World Stats findings.
The regional market is set to grow by 16.4 per cent over the next three and a half years in terms of e-commerce sales