E-Commerce Flourishing in the Middle East

E-commerce in the Middle East has certainly grown during the last 10 years. Now, the estimated number of Internet users in the Middle East is over 90 million people and growing. On the other hand, only 15% of the business companies in the Middle East have online websites. In addition, E-commerce has less than 1% of the total retail sales in the Middle East. What is more, it is expected that e-commerce will grow in the region to reach $15 billion in 2015.
yStates.com has recently released a new report on e-commerce in the Middle East and it indicates that E-commerce in the region is prepared for prosperity as internet users has increased and population has become more familiar with the concept of online shopping. For the next few years the growth rates are expected to increase 20% per year. And this growth is led by markets in The UAE, Saudi Arabia, Egypt, and Qatar. The categories that produce the most revenue in e-commerce are electronics, computers, and jewelry.
Despite the fact that e-commerce faces many obstacles in the region such as; low acceptance and trust of online payment, the dominance of offline markets and low adoption of online retail channel. In fact the biggest e-commerce concern in the Middle East is the risk of using credit cards as a method of payment. In addition, over the third of internet users in the region are worried that they won't be able to return or exchange the product they bought if they didn't like it.
However many e-commerce ventures have applied methods to overcome these obstacles and they used creative payment methods such as "pay on delivery" which means that costumers pay money only when they receive their orders. Among those online ventures are "Namshi" in UAE and Jumia in Egypt.
The penetration of e-commerce varies across the Middle East with UEA holding the largest share of e-commerce penetration (46%) followed by Kuwait, Suadia Arabia then Egypt. It is worth mentioning that Kuwait has the highest level of online retail with 19% of the internet users in the country shopping online, followed by Saudi Arabia with 10% of its internet users shopping online while only 5% of Egyptian internet users choose e-commerce. (Ipsos 2013).
The age of online shoppers in the Arab world is between 20-40 years old with more men buying online than women. Online shopping is more attractive to men than women because men are usually interested in electronics and mobiles. On the other hand, women love accessories and fashion so they trust online shopping when it comes to buying from these two categories. 46% of males compared to 32% of females choose online shopping in the Middle East.
In a nutshell, E-commerce will boom in the next few years in the Middle East and people will eventually choose to buy from the comfort of their homes. It is a trend that is becoming more and more popular in the region. It is worth mentioning that the E-commerce industry provides many job opportunities in countries like Egypt and Saudi Arabia.