Tech savvy Mideast goes e-Shopping
Dubai, October 29, 2013
The Middle East consumers, who are among the most tech savvy in the world with 86 per cent of the people owning a laptop and 48 per cent in possession of a tablet device, have begun embracing online shopping in a big way, according to a new report.
While the mall still reigns as the ultimate shopping destination in the Middle East, e-commerce is quickly gaining pace and is set to become one of the biggest growth areas for business in the region, said a new report released by Aimia, a global leader in loyalty management and the company behind Air Miles in the Middle East.
The report, entitled: "Smart, Savvy and Set to Soar: Customer Loyalty in the Middle East," looks at consumer behaviour in the region and the likely implications for business and is based on the results of months of in-depth research into Middle East consumer shopping habits and buying behaviour.
Releasing the report during his keynote address to open 'The Marketing Show' in Dubai, Paul Lacey, the managing director, Coalition Development, Aimia in the Middle East, said: “Businesses in the Middle East need to rethink how they’re speaking with their customers, who are generally young, tech savvy, and ready to engage with brands online through email and social media.”
“They are our new consumers and businesses need to understand that their expectations are higher than ever before. As long as businesses embrace this changing environment we’re working in, there is ample opportunity to grow in leaps and bounds ahead of other markets,” he noted.
According to him, Middle East consumers are among the most tech savvy in the world as eighty-six per cent of people own a laptop and 48 per cent of people are in possession of a tablet device. Eighty-five per cent have a smartphone, he added.
The research shows that people are highly engaged with regular communications including email, SMS and social media technologies. Nearly 90 per cent of them use email regularly and two in every three are active on Facebook at least once a day.
This behaviour has even been recognised by the malls, which are increasingly making free Wi-Fi available to shoppers. Smartphones, as well as being commonplace, are regularly used as shopping aides - supplying reviews, price comparisons and opinions from respondents’ social networks during the shopping process.
Interestingly, a significantly higher proportion of males said that they used their mobile to perform price comparisons before making a purchase in store (49 per cent vs. 39 per cent of females), said the survey report.
“This constant connection is by no means unique to the Middle East, but what we do see here, is the influence of the social world on people’s relationships with brands and businesses - a trend that continues to grow because of the high rate of smartphone use,” said Lacey.
Even though Middle Eastern consumers are leading the way in use of technology, unlike other markets this has not translated into online shopping yet there are signs that this is about to change.
Today, $1.1 billion is spent in the Middle East over the internet annually and by 2016, it is predicted to grow to $2.2 billion .
“We face an interesting situation here where everyone has a smartphone in their pocket and they’re generally not afraid to use it in relation to new social connections or contacts, but the one area they are still wary about is shopping online,” said Lacey.
“Retailers need to significantly build their trust before consumers will be willing to part with more information or trust online shopping to deliver a similar experience to the shopping mall,” he added.
The report found that shoppers across the region use the Internet to compare prices and read reviews that influence their shopping behaviour. Estimates suggest that some 20 per cent of in-store sales are influenced by pre-purchase digital touch points.
Aimia’s research shows that as well as 46 per cent percent of Middle East consumers using their mobile devices to check price comparisons in-store, 44 per cent percent also seek out user reviews before making a purchase and 44 per cent percent seek opinions from social networks before making purchases.
“In the future, building more profitable customer relationships will not simply depend on direct contact through smart technology, it will also depend on influencing social networks,” added Lacey.
The report called upon businesses to continue building trust amongst their customers to encourage them to shop online.-TradeArabia News Service