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Gulf’s ecommerce plans need a reset

It’s time to ditch all that ‘omnichannel’ talk and come with mix of old and new ways



Gulf's ecommerce space is putting in exponential growth rates, but could still do with a few tweaks here and there.
Image Credit: Gulf News Archive

It seems almost funny to think of a time when regional e-commerce was little more than a novelty. You know, something to dabble in now and again, but never trusted enough to be the primary means of getting something you wanted.

Fast forward to where we are today, the start of a new decade, and the regional e-commerce market is worth some $69 billion, as per a study by the World Economic Forum. It’s not so much a prediction but more of a foregone conclusion at this point - consumers are moving online and brands are following suit.

We’ve seen e-commerce evolve from a fledgling industry to an established powerhouse, as prior concerns over online payments and brand authenticity have been met head on with tighter digital regulation and more rigorous vendor checks, which in turn has helped gain consumer trust.

Of course, none of this has happened overnight. It has taken time for online enterprises and consumers to speak the same language and meet expectations on both sides. Today, we find ourselves in a unique position to go further than this; we can anticipate, personalise and provide consumers with a tailored experience akin to that seen on a global scale.

In delivery mode

You only need to look at the recently launched Dubai E-commerce Strategy as further proof - they are declaring the country open for business, signalling to foreign investors how this strategy is aiming to position Dubai as a global logistics hub to propel future growth and stability within the region.

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This is good news for other emerging markets looking to increase their share of the e-commerce pie as well. Saudi Arabia’s e-commerce sector is currently growing at a healthy 32 per cent annual rate, with digital penetration expected to reach 96.44 per cent by 2023. When you consider the digitally-savvy youthful population, it’s clear that this will be a market to watch in the coming years, and teamed with new government initiatives to ease entry into the country, don’t discount the impact increased tourism could have in boosting the Kingdom’s e-commerce stronghold.

So, what lies ahead for e-commerce in the more immediate future?

Forget omnichannel, think what’s best for business

Given this was the most overused buzzword of the last decade, I vote to officially retire it. Let me be clear, I fully applaud the idea of an experience where consumers can interact and engage across multiple or simultaneous touch points. But in our rush to ensure every strategy ticks this box, there’s a real concern that we are simply spreading ourselves too thinly and bombarding the customer at every turn.

As effective personalisation becomes the overriding deciding factor to purchase intent, the idea of appearing on multiple channels and in multiple places feels jarring to me. As consumers become more selective, so too must businesses in ensuring they appear on the channels that most matter.

I predict a return to the old school “B2C” way of thinking, but with one addition - using new technology to help us determine how, when and why we should communicate with each individual.

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Digital gateway to frictionless shopping

A survey by Dubai Department of Economic Development (DED) and Visa revealed that 66 per cent of respondents trust online shopping, while 70 per cent trust online payments - that in itself is a huge achievement compared to five years ago. Now we need to build on this and ensure the infrastructure is in place as consumers become even more familiar with the smart payments available to them.

The use of mobile wallets in particular is key, with the likes of Apple Pay and Google Pay entering the market, alongside local players such as Etisalat Wallet and Beam Wallet. Paypal too has launched its dirham service, showing how important flexible payments in multiple currencies will be, and also going some way towards the cashless ecosystem the UAE is looking to achieve by 2021.

Cutting red tape for better business

Under the Dubai E-Commerce Strategy, the government is looking to ease current constraints with a raft of new initiatives. They want to reduce the cost of e-commerce activities by 20 per cent over the next three years, review transportation and storage costs, as well as reducing the paperwork required for customs clearance. And, perhaps most crucially of all, reduce the fees imposed on goods passing through free zone gates.

Of course, enforcing these policies won’t be without its challenges, but particularly if the latter does happen, it will have a big impact on companies and further bolster Dubai’s reputation as one of the business capitals of the world. In short, there’s never been a better time or place to start your new venture.

Future is bright and the future is AI

Before we all get carried away with the idea of drones en masse or robots replacing us in our everyday jobs, let’s take a step back and consider what function AI and Machine Learning has in today’s e-commerce world. Certainly technology and e-commerce intersect at every point, from online transactions to automated data collection and internet marketing.

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But where does that leave us for the future? On a broader business level, we could see more international entrants look to open their own data centres in the UAE, but on a consumer level, we could see social commerce become the main area for AI integration, helping to inform buying decisions.

Chatbots have already been adopted as a way to stay connected to the consumer 24x7, but beyond this, AI can help deepen the level of personalisation we as online businesses can offer. That being said, we’ll need to invest in the right kind of talent that can utilise this technology effectively, identifying the right data points to target, and crucially, involving customers from the outset, so that we can improve their online experience together.

New markets, new tricks

As tempting as it is to roll out the same tried and tested formula with every new market, locality matters and cannot be underestimated when it comes to expanding into new countries. That’s not to say that there shouldn’t be a level of standardisation, so consumers can instantly recognise your brand.

But local nuances should be observed in order to connect with the regional market more effectively. Trust me, there’s no one-size-fits-all shortcut here.

- Sarah Jones is CEO of Sprii.

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