Today, as part of our 2015 round-up on the state of international ecommerce, we are looking at the Middle East; a region that has huge growth potential and high spending consumers.
With a young, dynamic population, high internet penetration and large amounts of personal disposable income, the Middle East is quickly emerging as one of the fastest developing online markets in the world!
Despite online retail penetration in the Middle East being less than 1%, at the end of 2015, the region showcases a huge ecommerce potential, having grown by the staggering 1500% over the last decade.
The Middle East is currently characterised by a young, dynamic and very tech savvy population, with 26-35 year-old make up at least 42% of all online buyers in the region. Since this age group enjoys very high personal disposable incomes and feels more and more confident to purchase online, it’s no surprise that the ecommerce industry in the region is expected to reach $7bn by the end of the year.
As Arab shoppers are exposed to a limited selection in local online stores, they are increasingly turning to foreign online retailers. The result … cross-border ecommerce in the Middle East is growing at more than 70% year-on-year.
Most online shopping is done with retailers from the US (35%), Asia (30%) and Europe (25%), and now, at the end of 2015, cross-border online trade makes up more than 10% of the total ecommerce industry in the region.
The Middle East enjoys very high accessibility to mobile devices and also has one of highest per capita internet penetration levels in the world! So, by the end of the year, mobile spending in the region is projected to grow by up to 39%, and is expected to be worth approximately $3bn.
While all these trends will continue to shape the ecommerce landscape in the Middle East in the New Year, creating new exciting opportunities for online retailers, security will still remain a concern for some Arab shoppers that don’t trust online shopping.
Improved localisation, achieved through professional customer service and the right product selection, and offering locally accepted payment methods, such cash-on-delivery, will be some of the key milestones that online retailers need to reach in the New Year, if they want to successfully tap into the lavish online opportunities the Middle East has to offer.
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