UAE tops the region for retail e-commerce | UAE tops the region for retail e-commerce -
UAE tops the region for retail e-commerce

UAE tops the region for retail e-commerce

: Tuesday, December 10 - 2013 @ 10:22

China tops A.T. Kearney ranking followed by Japan and the US

The UAE has ranked 25th in the Global Retail E-Commerce Index, with a ‘strong potential’ for growth in the next five years. The index by A.T. Kearney lists 30 developed and developing markets, with China occupying the top position and the G8 countries (Japan, the US, the UK, Germany, France, Canada, Russia and Italy) all within the top 15.

Developing countries feature prominently in the index, holding ten of the 30 positions. Many have been able to shortcut the traditional online retail maturity curve, as it grows at the same time as physical retail becomes more organised. E-commerce is increasingly viewed by retailers as an efficient and effective global expansion vehicle.

Mike Moriarty, A.T. Kearney’s partner and co-author of the study, says: “Consumers in developing markets are fast adopting behaviours similar to those in more developed countries. For example, mobile phones per capita in Russia (1.8) and the UAE (1.7) are much higher than developed markets, including the US (1.0) and France (1.0). Consumers in these countries use their phones to research products, compare prices and seek input from their friends on social media.”

Martin Fabel, partner and head of consumer industry and retail practice at A.T. Kearney Middle East, says: “The UAE’s retail e-commerce sector is varied when looked at in relation to three key indicator areas; it’s above the median on growth potential and infrastructure, meaning cheap delivery, below the median on consumer behaviour and bottom of the table when it comes to market size.”

He adds: “The vital ingredients exist, but to exploit the growth potential of e-commerce, consumer behaviour in the UAE must change – for instance, online shopping needs to provide an experience to rival the allure of shopping malls. Other GCC markets are further behind, due to even lower consumer interest in e-commerce.”

A.T. Kearney’s Global Retail E-Commerce Index is the only truly global study that ranks the top countries in online retail, based on a zero-to-100-point scale. The higher the ranking, the more near-term ROI potential a country has in online retail. Online retail is defined as the sale of consumer goods to the general public through websites operated by pure-play online retailers or store-based retailers.

This term also includes mobile commerce sales through smartphones or tablets. Sales are attributed to the country where the purchase is made, not where retailers are located. Countries in the Index are evaluated across four key dimensions – online market size (40 per cent), consumer behaviours (20 per cent), infrastructure (20 per cent) and growth potential (20 per cent).

The index includes ten ‘small gems’ – countries with populations of less than ten million, such as Singapore, Hong Kong, Slovakia, New Zealand, Finland, the UAE, Norway, Ireland, Denmark and Switzerland – that have active online consumers and sufficient infrastructure to support online retail. Because of the investment profile required for global retailers or pure-play e-tailers, these small gems can be powerful online retail markets.

A.T. Kearney looked at 186 countries to determine the ranking of the top 30 countries. The Index evaluates countries across four dimensions and nine variables and ranks the retail e-commerce attractiveness for each country.

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Tuesday, December 10- 2013 @ 10:22 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.

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