The Middle East is in the spotlight of E-Commerce companies for its high growth potential. Even in the region’s largest E-Commerce market, the UAE, the online channel does not account for much more than a single percentage point of total retail sales. In Saudi Arabia the growth potential is even higher, as the country is more populated than the UAE and both the Internet and online shopper penetration rates are lower.
Saudi Arabia was the only country in the Middle East to be ranked among the world’s most attractive E-Commerce markets in 2015 by an international consultancy. With its population being overshadowed in the region by that of Iran only, Saudi Arabia has the largest economy in the Middle East, which continues to grow despite the plunge in oil prices. The government is giving out incentives to boost spending, which stimulates the retail market. The online retail segment is predicted to remain the most dynamic of all, with double-digit growth rates to be retained for the near future.
As the E-Commerce market is in early stages of development, it is relatively consolidated in terms of competition, with the region’s largest Internet company, Souq.com, accounting for the lion’s share of total online sales. However, local retailers are also noticing the trend towards Internet shopping. One of them, a seller of electronics, books and office supplies, Jarir Marketing Company, recently launched its own E-Commerce platform. Moreover, online shoppers in Saudi Arabia are no strangers to cross-border purchases: Amazon.com, eBay.com, Alibaba.com and the like rank among the top 50 most visited websites in Saudi Arabia, along with the UAE’s Souq.com and a few classifieds platforms.
For more insights into this exciting market, see our report “Saudi Arabia B2C E-Commerce Market 2016”.