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

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