A significant shift in consumer behaviour has been noticed in Saudi Arabia, with local consumers increasingly turning to digital channels, amidst restricted movement due to the on-going COVID-19 pandemic, observes the Oxford Business Group (OBG). The efforts to maintain social distancing have led to rapid spike in e-commerce activities.
Saudi Arabia-based Danube Online and the Danube App – the e-commerce arms of supermarket and hypermarket chain operated by Bindawood Group of Companies – have seen average daily sales up over 200% and average order value up 50% in approximately the last two weeks, compared to the same figures in February 2020. “To meet the increased demand on Danube Online, Danube App and BinDawood App, we are expanding, hiring more staff for our online operations. We have begun working with external delivery aggregators with the support of the Ministry of Commerce and Trade. We are onboarding approximately two-three aggregators per day, training them on the online system to get them up and running, and increasing our capacity day-by-day,” shared Majed M. Al Tahan, co-founder & managing director, Danube Online.
Saudi grocery delivery app Nana has also benefitted from the recent turn towards online shopping, raising $18 million in a Series B funding round in late March to expand operations across the Middle East. Investors included venture capital funds Saudi Technology Ventures and Middle East Venture Partners. This follows a Series A funding round that raised $6 million last year. The company has expanded capacity three-fold following a surge in demand associated with the COVID-19 outbreak. This is expected to continue in light of the Saudi government’s decision to impose tighter curfews in major cities.
Looking ahead, retailers may need to adapt their supply chains in response to shifting market dynamics. “Vertical integration is a pivotal development strategy, especially considering the recent spike in demand for e-commerce and fresh food delivery, which Saudi Arabia’s supply can hardly meet,” said Seifallah Sharbatly, managing director of Sharbalty Fruit.
The increase in the pace of online retail, notwithstanding the crisis, aligns with some of the goals of Saudi Arabia’s overarching strategies, states OBG. As part of the Financial Sector Development Programme – part of Vision 2030 – the government hopes to increase the proportion of online payments to 70% by 2030, up from the 2020 target of 28%.
To help incentivise this growth and ensure long-term sustainability in the segment, the government has also sought to improve the regulatory framework. In October 2019, the government implemented the E-commerce Law, designed to regulate digital payments and improve transparency. On January 31, 2020 the Ministry of Commerce and Investment adopted the Implementing Regulations of the E-commerce Law, adding increased oversight to areas such as personal data protection, consumer rights and disclosure obligations.
A report from Bain & Company has revealed that the emergence of some positive shopping trendsMay 9, 2021 | By RetailME Bureau
UAE-based RAW recently announced that it would be extending its GCC operations,May 4, 2021 | By Bilal Syed
UAE-based Carrefour announced its theme and plans for Ramadan 2021. The brand
Locally owned supermarket Spinneys celebrates 60 years of doing business in the
UAE-based Carrefour will become the first retailer in the region to offer new levels
The Organic Farmers’ Market is back in Bay Avenue for its 12th
UAE-based Lulu Group recently inaugurated its first-ever all-female staff store in Jeddah,
Jones the Grocer, the gourmet grocer and cheese retailer launches the Jones
UAE-based Al Maya Supermarkets is hosting a two-week food festival at select
Locally-owned supermarket Spinneys has launched its ‘Power of Plants’ initiative in the
Carrefour UAE has launched “Cookit Yourself” — a curated recipe box created
UAE-based Al Islami Foods, one of the largest frozen food companies in
Marks & Spencer’s plant-based range now offers over 25 vegan products including meat-free
World’s largest fully integrated online brand in fresh fish and meat e-commerce
The once powerful department stores that anchored malls and streets around the
Who isn’t a sucker for discounts? Customers today are spoiled for choice
The various e-commerce and virtual retail stores that cater to different product
A private helicopter carrying the chairman and managing director of Lulu Group,
Retailers in the Middle East are making strides in their multichannel offerings,
Tighter restrictions on hotels, restaurants, shopping malls and entertainment venues on account of
All hotels and restaurants have been directed to temporarily hold entertainment activities
The new Dubai Gold Souk is “very much on track”, according to
Gone are the days of traditional brick-and-mortar as well as purely e-commerce
The Dubai Gold & Jewellery Group’s ongoing jewellery campaign, held in association
Retail Abu Dhabi, the retail platform of the Department of Culture and