UAE e-commerce market to touch $9.2-bn by 2026


October 5, 2022 | By RetailME Bureau

The UAE e-commerce market is expected to reach $9.2 billion in 2026, indicates a new report by Dubai Chamber of Commerce based on data from Euromonitor. E-commerce will account for 12.6% of total retail sales in the UAE by the same year.

Total e-commerce sales in the UAE recorded remarkable growth in 2021, reaching $4.8 billion during the year, compared to $2.6 billion in 2019.

Also watch: A look inside the UAE’s first phygital store

Factors driving growth

The UAE’s e-commerce landscape has evolved and grown considerably in recent years, through major investments, acquisitions and partnerships with global companies.

Investments in the sector have significantly changed the dynamics of the UAE e-commerce market, with the main impact being a downward pressure on prices due to increased competition and supply.

The improvement and modernisation of payment systems and services was identified as another key factor that has boosted demand and business activity within the UAE’s e-commerce sector.

What’s more growth momentum within the UAE’s e-commerce sector is expected to continue, supported by rising demand for online shopping, coupled with steady investment flows in the sector’s infrastructure. The increasing momentum of e-commerce activity in the country is expected to provide more business opportunities in payment systems, financial technology, electronic logistics and distribution centres.

What’s driving online sales?

Consumer electronics in the UAE constituted the top selling online products in 2021 with a 34% share, consisting mainly of smartphones, phone accessories, computer accessories, tablets, computers and TVs. Apparel and footwear accounted for 31%, food and beverages 12%, media products 8%, personal accessories 5.8% and consumer appliances 3.3%.

The relatively high shares of products purchased online indicate increased competition between online channels and traditional channels for electronics, apparel, accessories, cosmetics, as well as food and beverages.

Among the main product categories offering the most untapped potential in the e-commerce market in 2022 are apparel and footwear, personal accessories, beauty and personal care and home and gardening.

Mobile retail to reach $4.6 billion

Unsurprisingly mobile devices, such as smartphones and tablets, accounted for a majority of e-commerce transactions last year as the mobile retail market reached $2.6 billion, accounting for 44% of the total e-commerce market value. Mobile retail sales are expected to record a CAGR of 15.6% over the 2022-26 period to reach $4.6 billion.

The study shows that more than one-third of consumers in the UAE bought a product or service using their smartphone at least once a week, which is above the global average of weekly online purchases.

Among key trends supporting the strong growth in mobile e-commerce transactions is the availability of apps, which has increased pricing transparency. The growing number of loyalty rewards programmes offered by online retailers also drove up demand for online shopping in the UAE.

Shoppers in the UAE, according to the report, preferred local retail websites to overseas retailers. In 2021, domestic e-commerce websites accounted on average for 73% of the total sales while foreign websites received only a 27% share.

However, the report stated that despite clear preference of buyers for domestic websites, increased competition from foreign e-retailers is projected in the future. Between 2022 and 2026, foreign e-commerce platforms are expected to grow by 19.2%, which would mark a 34% gain in market share.

Comments

comments

Previous Article Next Article

SHARE

YOU MAY ALSO LIKE /


GMG expands retail network with the acquisition of aswaaq

UAE-based diversified family business GMG expands its retail network with the acquisition 

Continue Reading

February 6, 2023 | By RetailME Bureau
Carrefour onboards female-led start-up The Zola Collective

Carrefour, which is owned and operated by Majid Al Futtaim in the 

Continue Reading

January 31, 2023 | By RetailME Bureau
A new branch of Waitrose comes up in Abu Dhabi’s Khalifa City

British grocer Waitrose has opened its newest store in Abu Dhabi’s Khalifa 

Continue Reading

January 25, 2023 | By RetailME Bureau
Its Netherlands Food Week at Al Maya Supermarkets

UAE-based Al Maya Supermarkets has kicked off its ‘Netherlands Food Week’ that 

Continue Reading

January 20, 2023 | By RetailME Bureau
Tesco announces price lock to support consumers amid inflation (PC: Andrew Parsons / Parsons Media)

British grocery retail chain Tesco has announced a price lock on over 

Continue Reading

January 13, 2023 | By RetailME Bureau
Union Coop renews ISO certification

Dubai-based grocery retailer Union Coop has successfully obtained the ISO 22301, an 

Continue Reading

January 12, 2023 | By RetailME Bureau
Spanish supermarket chain Mercadona announces salary increase amid inflation (PC: Mercadona)

Spanish omnichannel supermarket chain Mercadona has announced salary increase amid inflation that 

Continue Reading

January 3, 2023 | By RetailME Bureau
Choithrams partners with Rove Hotels to open 8 new outlets

Grocery retail chain Choithrams will open eight convenience stores across Rove Hotels’ 

Continue Reading

December 30, 2022 | By RetailME Bureau
Géant to open more than 20 stores in the UAE in 2023

Part of regional retail conglomerate GMG, Géant plans to open more than 

Continue Reading

December 23, 2022 | By RetailME Bureau
FMCG online sales growing by 68% in UAE and 58% in KSA

Online share in FMCG sales has been growing all over the world, 

Continue Reading

December 19, 2022 | By RetailME Bureau
Majid Al Futtaim Retail, Standard Chartered launch region’s first Sustainable Supply Chain Finance Programme

Majid Al Futtaim Retail, operator of the Carrefour franchise in the Middle 

Continue Reading

December 15, 2022 | By RetailME Bureau
GMG and Silal partner to support 1,100 UAE farms access local retail market

UAE-based diversified conglomerate GMG and Silal have signed a memorandum of understanding 

Continue Reading

December 12, 2022 | By RetailME Bureau




Download Images RetailME Magazine