The Rise of Ecommerce in the MENA Region

May 9, 2016 Vimal Panicker

The MENA region's ecommerce market will continue to grow in 2016. The market for physical products sold online is predicted to grow $6.4 billion by 2020, which will result in a $13.4 billion ecommerce market in the MENA region. This is a significant increase compared to the market valuation in 2014, which was $7 billion. Entrepreneur Magazine has predicted that a change in consumer trends when it comes to online payments will be a major contributor to growth.

The larger ecommerce market with physical products and services combine for an estimated $40 billion industry in the MENA region.

MENA Ecommerce Leaders

gpi-MENA ecommerce-home

The Kingdom of Saudi Arabia (KSA) and Egypt are leading the pack when it comes to online purchases in the region, the two largest population centers in the Arab world. In the KSA, more than two-thirds of online shoppers were buying products on their smartphones in 2014. Egypt continues to advance in internet usage and social media to find and purchase products online.

Close behind these two countries is the UAE. This country has the highest internet and mobile phone penetration rate and is home to large online retailers such as Souq.com and Sukar.com.

Payfort, an online payment platform for the Middle East, expects these three major markets will continue to drive changes in MENA ecommerce. Egypt has the largest number of online buyers, but the UAE and Kuwait have higher proportions of ecommerce customers per capita.

Reasons for Growth

The reasons behind this type of growth are higher online penetration levels, an increase in smartphone ownership by residents and changing trends in online payments. Additionally, high quality Wi-Fi is now available in more areas and the large expatriate community are buying their favorite international items online.

Changing payment trends are due to the MENA region's preference for cash on delivery, rather than credit or debit cards. Payfort estimates that 72% of consumers in Egypt use cash for their ecommerce activity. This represents a challenge for ecommerce businesses entering into the MENA region, but it also represents an opportunity as other forms of payments grow in popularity in these markets.

Summary

While there are still MENA residents who prefer to purchase in-store, brands cannot overlook the online opportunities that have arisen in this ecommerce market. As an international brand with an ecommerce presence, it is imperative a localization strategy is implemented, especially in a region where there is a large expatriate community and various languages spoken. For brands based in the MENA region, a website translated into at least English and Arabic is essential as a part of a global marketing strategy.

Further Resources on Arabic Localization, Arabic Globalization and Arabic SEO

Globalization Partners International (GPI) has extensive experience localizing marketing materials, technical documents, and large, scalable websites into the Arabic language. Due to increased demand for projects in Arabic and other BiDi languages, like Farsi, we have posted a number of useful guides to best practices in this area. Feel free to review our blogs that are particularly relevant:

Please feel free to contact GPI at info@globalizationpartners.com with any questions about our language and technology services.  Also let us know if you have any interesting blog topics you would like us to cover in our future blogs. You may request a complimentary Translation Quote for your projects as well.

About the Author

Vimal Panicker

Vimal Panicker is from Mumbai, India, and currently lives in Dubai. He has 5 years of experience in project management, working in the translation and localization business and has managed projects for a diverse portfolio of companies in the IT, life sciences and legal industry. Vimal holds a Bachelors Degree in Commerce from Mumbai University and has a great passion for developing and maintaining client relationships. He started off his career in the localization industry and is well-informed with the tools, processes and practices. He loves working with a culturally-diverse team and believes in exceeding client expectations. For him, translation is not only a great medium to work with people from diverse cultures but also a great platform to connect with organizations from varied sectors and understand their business functions. Outside work, he loves to watch and play football and has a great interest in fitness activities.

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