Dubai Chamber: Its share is expected to reach 12.6% of total retail sales

33.7 billion dirhams e-commerce market in the UAE by 2026

Sales of goods via e-commerce in the country recorded a remarkable growth last year.

archival

The Dubai Chamber of Commerce expected that the share of e-commerce retail sales in the UAE will reach 12.6% of total retail sales by 2026, up from 8.7% recorded in 2021, which indicates that there are promising opportunities for growth in the e-commerce market, and the acceleration of Adopting the concept of e-commerce in the country.

A recent analysis of the chamber, based on data from Euromonitor, which was launched as part of preparations for the launch of GITEX Global 2022 next week, revealed that the total sales of goods via e-commerce in the UAE recorded a remarkable growth last year, reaching $4.8 billion (more than 17.6 billion dirhams), compared to 2.6 billion dollars (9.5 billion dirhams) in 2019, while the size of the retail goods market via e-commerce in the country is expected to reach 9.2 billion dollars (33.7 billion dirhams) in 2026, with a growth rate Compound annual rate of 12.6% during the period (2022-2026).

The analysis indicated that online retail using a mobile phone is one of the main categories of e-commerce in the UAE, as it measures the percentage of online retail sales on a mobile phone, such as a smartphone or tablet.

He explained that the size of the mobile retail market in 2021 amounted to about $2.6 billion, which represents 44% of the total size of the e-commerce market in the UAE.

Mobile retail sales are expected to reach $4.6 billion by 2026, with an expected increase in market share to 50% (expected compound annual growth rate of 15.6% over 2022-2026).

Applications

According to the analysis, among the many trends that have supported the exponential growth of mobile e-commerce in the UAE is the availability of apps that have increased pricing transparency by offering price comparisons for products sold via online platforms.

The increasing number of loyalty rewards programs offered by retail e-commerce platforms has also supported the growing demand for online shopping in the UAE.

local sites

And the Dubai Chamber analysis stated that retail e-commerce customers residing in the UAE bought more through local websites than from outside the country.

And he indicated that local e-commerce sites accounted for an average of 73% of the total retail sales of e-commerce in the UAE, compared to 27% of external websites during the past year.

However, local e-commerce channels are expected to face more competition from external channels which are expected to grow by 19.2% during the period 2022-2026, and take a 34% share of the total online shopping in the UAE.

consumer electronics

According to the analysis, consumer electronics, in the UAE, constituted the best-selling online products in 2021, with a share of 34%, and it mainly consists of smartphones, phone accessories, computer accessories, tablets, computers and TVs, while clothing and shoes accounted for a share of 31. %, food and beverages 12%, media products 8%, personal accessories 5.8%, and consumer appliances 3.3%.

The relatively high shares of products purchased online indicate increased competition between online channels and traditional channels for electronics, apparel, accessories, cosmetics, and packaged food and beverages.

compete

The analysis expected that the importance of the e-commerce sector in the UAE would increase, supported by the increase in the demand for online retail shopping, and the continued investment in the infrastructure of the sector by the government and private sectors.

The increasing momentum of online shopping activity in the country has put pressure on the prices of traditional retailers, as customers can get the same products online, but at lower prices, which increases the competitiveness of the retail sector in the UAE.

It is also expected that the increasing momentum of activity in e-commerce in the country will lead to providing more business opportunities in payment systems, financial technology, electronic logistics and distribution centers.

untapped areas

A recent analysis of the «Dubai Chamber» revealed that the areas of commerce that have the largest untapped potential for e-commerce in the UAE, this year, are clothes and shoes, personal accessories, cosmetics and personal care, and home and garden care products.

73%

Of the total e-commerce sales in the country accounted for by local websites.

Selling online using “mobile” is one of the main categories of e-commerce in the UAE. 

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