Dubai Chamber of Commerce and Industry has published a new report. Due to the Covid-19 pandemic, the habits of consumers have changed. The quarantine has changed their preferences from in-store shopping to online. The following key factors have supported this growth:
- The growing use of the internet
- High-income potential
- Digital payment services
- Population relying more on tech
- Developed supply chain management
Due to the growing use of smartphones in the UAE, the growth of e-commerce has also enhanced. In 2015, it was 29%; in 2020, it was 42%. So, the UAE retail m-commerce market rose to $1.6 billion that was 56% more than in 2019. While according to expectations, it will reach $3.9 billion by 2025.
Most consumers prefer cash on delivery. Due to the pandemic, they prefer other payment methods as a hygienic measure. Moreover, the increasing costs are another financial pressure on online retailers. While the threatening financial pressure on them is the increase in products returns. Most of the returns happened in e-commerce as compared to shopping in-store. Some improvements are required to overcome this challenge of products return:
- Improving online product details
- Customer support
The demand for electronics like computers, tablets, and laptops increased due to remote work and online education. It was one of the largest UAE’s retail e-commerce categories with a share of $1.2 billion. Many developed retailers created their mobile apps. Through this, they are meeting the growing demands of customers and increasing sales. Its purpose was to meet the needs of the consumers. The Telecommunications Regulatory Authority of UAE has reported that; there are almost 52 apps specialized in beverages, groceries, and food.
The e-commerce industry will continue to grow due to rising of voice commerce, AR approach, products subscription, and instant virtual assistance services.