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United Arab Emirates: E-commerce is experiencing strong growth – new solutions required urgently

payment-solutions digitalisation eCommerce
Senior Advisor

victoria ivanova

+971 501 050 337
The Corona-related lockdown has accelerated the adoption of digital tools in the United Arab Emirates (UAE). There is a significant increase in demand for new e-commerce platforms. This has created demand for advanced e-commerce technology and solutions.

Market consensus is that during 2020 e-commerce growth in UAE will significantly exceed that of 2019. Evidence suggests that some e-commerce platforms have seen a higher adoption rate in the single month of March 2020 than during the whole of 2019. According to the 2019 Visa-DED report, UAE is a clear leader in the growth of e-commerce growth in the region; the Middle East and North Africa (MENA) region leads e-commerce growth globally.

The total market size of e-commerce in UAE (including all categories) is estimated to be worth USD 48.6 billion in 2022; up from USD 26.9 billion in 2018 (Visa report 2019).

The following factors were identified as the main driving forces prior to the pandemic:

  • Excellent infrastructure
  • High internet penetration
  • World-class logistics (Jebel Ali Port, Dubai International Airport)
  • Young population (ca.30% are digital natives)
  • Rising penetration of mobile payments and the increased trend of cashless payments (Increased security has resulted in 70% trust in online payments)
  • Government digital initiatives and smart platforms
  • High online spend (annual per online shopper @ USD 1.600)
  • Growing digital shopping opportunities (Amazon entered the market via an acquisition; traditional retailers are eagerly embracing omni-channel)
  • High VC investments for startups

The demand for technical solutions for multi-tenant e-commerce platforms include:

  • Artificial intelligence
  • Big data / analytics
  • Cybersecurity
  • Digital marketing tools
  • Digital payment tools
  • Omni-channel customer experience (UI/UX)
  • Optimization tools
  • White label multi-tenant e-commerce platforms