PayPal report reveals promising numbers in the MENA region with evidence of growth and encouraging opportunities for merchants, online.
With the online commerce market currently at 11.2 billion USD, coming from 7 billion USD in 2011 and expected to reach 15 billion USD in 2015, the report gives evidence of clear and steady growth. It also indicates that cross-border e-commerce in the MENA region is experiencing even greater development than local business (with a 70% year on year growth rate) and suggests that the boom can be put down to: limited product variety locally and the excitement of foreign goods.
The breakdown is as follows:
Intra MENA: 10% (and experiencing steady growth)
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According to the report various factors have contributed to e-commerce growth in these parts of the world including the fact that people are starting to shop online for the first time, new retailers are popping up online or creating an internet presence in conjunction with their existing offline stores, there is increased online marketing of foreign merchants to these regions and lastly, the “explosive growth of mobile commerce”.
The top three online commerce markets in the Middle East and North Africa are the Kingdom of Saudi Arabia, Qatar and the United Arab Emirates and according to Francis Barel Business Development Manager, PayPal Middle East and Africa who comments on the report, “Consumers are telling us that: the main reason to shop online is convenience; the biggest challenge is trust; and the biggest opportunity is choice.”
He suggests that merchants within this region or selling to this region should inform their customers about how they are protected when shopping. He also highlights that ease and convenience must be considered and that because price-point and variety motivate online shopping, merchants should consider these factors in their planning. He adds that free or cheap shipping also helps to encourage consumer spending and expressed the need to offer a variety of payment options.
With regards to payment preferences the reports reveals that cash on delivery is still the preferred payment method for MENA consumers followed by payment cards and then PayPal, or as we can assume, other such services.
Along with various other tips and tidbits, the report in summary, encourages online and suggests that e-commerce is adding value to commerce in general with MENA consumers slowly but surely emerging as contributors to the world of internet shopping and seeking the fun, convenience and money saving opportunities that they expect from their virtual shopping carts.
“Shoppers are using all forms of technology to browse and shop, and particularly on their smartphones. With these trends revolutionizing commerce in the Middle East, conversations around ‘online’ and ‘offline’ retail are quickly losing their relevance. As consumers get used to shopping across a variety of channels and platforms, both locally and globally, the impetus is on retailers to innovate to offer 24 by 7 multi-channel shopping experiences and connect better,” writes Elias Ghanem, Managing Director, PayPal Middle East and North Africa.
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