Dubai: UAE’s retailers are finding that some of their brick-and-mortar strategies are working just as well online. Targeted promotions — on select products within a specified time frame — are being deployed to pull in increased traffic and transactions for their e-commerce portals.
Doing so tends to serve multiple purposes — reach out to a growing online audience and get them started on web-based purchases, encourage repeat visits by those who have already bought through the portal in the past, and, looking to the bigger picture, create the parts that will add up to a substantial whole in the not too distant future.
“The first wave of online consumer transactions in the UAE were led by the western expats, while the traditional Middle East shopper retained their preference for malls,” said Nadeem Khanzadah, Head of Omni-retail at Jumbo Group. “But, now, enough pockets are starting to emerge among different demographics that would create a sustainable business environment for online vendors. They are not just using online transactions to book airline tickets or hotel rooms but for mainstream consumer goods as well.
“At the current pace, online selling in the UAE will take another two years to reach a certain scale, with some of the other Gulf markets following in its wake.”
As of now, there are only a handful of online vendors in the UAE who have been able to stay in the frame in the last three years, while many others had to pull the plug after they found volumes — and margins — were not enough to keep them going. What made it difficult was that all of them were selling more or less the same products — primarily tech gadgets and smartphones — and at prices which did not have that much of a gap with prices at physical stores.
Critically, online vendors could not match the kind of bundled offers that physical vendors have been known for in Dubai and the UAE for years. And that is where most of them lost out.
The Jumbo Group took its time over taking the online selling route and only went live last November. Its online inventory matches what is available at the outlets, but the retailer is timing product promotions to pull in transactions.
“Recently we had one for a branded barbecue grill as there was a lot of outdoor activity going on at the time,” said Khanzadah. “And the response was not limited to certain demographics — we got the pricing right and that was enough.
“It’s a fallacy to assume that only high-volume gadgets such as smartphones or tablets should be backed by promotions. They key element is to build traffic to the portal and you can do that with all kinds of products.”
Portals are even letting local shoppers to indulge in their innate passion to get “value” out of their purchases. The recently launched ensureshopping.com portal does that through allowing a bit of bargaining on-site. “Shoppers have the option of quoting a discount of up to 50 per cent on the listed price and then the site managers will oversee whether the product can be given away at the quoted discount or not,” said Rahul Nanda, General Manager of ensureshopping.com.
“’Web specials’ are the way that more e-commerce portals will try and differentiate themselves from the rest of the pack. Once a portal starts offering such special deals on a consistent basis, it gets the kind of committed buys and the repeat visits. That would also have the brand principals more willing to do special promotions with the concerned vendor.”
Clearly, some rules of the retail game do not change in the UAE.
