Dubai: Just as the retail world was getting comfortable with e-commerce, a new wave of consumers is making the move to mCommerce.
mCommerce — or mobile commerce transactions — includes the purchase and sale of goods and services, online banking, and information delivery on smartphones.
“Mobile now is the device of choice for payment, access information and communication,” said Kivanc Onan, the regional Director of PayPal Mena and Turkey, who attributes the shift to mCommerce to the fast pace of consumer adoption of tablets and mobile phones. PayPal is international, digital-wallet based business that allows payments and money transfers to be made through the internet.
In 2014, eCommerce globally was estimated at $220 billion (Dh807.4 billion), but 20 per cent of these trade transactions have been made via mobile phones. That market alone is valued at $45 billion, Onan said. On Black Friday, the traditional start of the holiday shopping season in the US, nearly half of online sales were made via mobile phones, he added.
Last year, 20 per cent of PayPal’s net Total Payment Volume was from mobile payments and more than a quarter of the payments made with PayPal in the year were made on a mobile device.
The growth is being attributed to the growth of mobile marketing, which has been growing in popularity in recent years and is overtaking desktop marketing and commerce at a fast pace. Currently, all online shops have mobile marketing at the top of their priority list in order to stay in touch with fast moving trends, said Bhairav Trivedi, CEO of Network International.
ECommerce
The value of eCommerce in the Mena region in 2014 stood at $15 billion, while the UAE share is estimated at $2.5 billion for the same period, Trivedi said. The UAE holds a large potential market for eCommerce, especially when compared to developed countries in Europe.
However, Tivedi added that the challenges are still there in terms of regulations and security. He said government should work harder to promote this industry by developing a clear framework to cover certain legal aspects of electronic commerce in the internal market.
While the security issue is always a challenge for the online industry, regulations can only come when usage passes a certain level, he said.
Trivedi also highlighted some obstacles that slow down the growth of this business in the UAE.
“There are very big shopping malls in the UAE and most of the consumers prefer to check their products before buying,” he said.
This is also linked to the fact that there is no refund policy for online purchase in the UAE and the safest choice for consumer to go direct to the shop, Trivedi said. Connectivity is another factor that has slowed down the performance of this business although that is starting to change, he said.
“It is a matter of time and the initiative to transform Dubai into a smart government and smart city will definitely accelerate e-Commerce,” he said.
Government Role
According to Dubai Department of Economic Department (DED), websites registered under the .ae domain name, or representing companies headquartered in Dubai, have been given the deadline to display the DED consumer complaints helpline number — 600 545555 — when they offer goods or services for purchase online. The department also asked all online shops to post the consumer protection helpline number on their websites.
