Complex Made Simple

Can GCC malls win back e-commerce shoppers?

Who would have thought that we would one day forgo the Shopping experience at a mall in favor of a few clicks from the comfort of a couch, business desk or behind the wheel of an autonomous car?

Yet it’s happening.

“Retail has undergone massive disruption due to the rise of online shopping and the emergence of massive e-commerce only companies, companies which have the logistics and digital prowess to quickly adapt to fast-changing consumer behavior,” according to Business Insider (BI).

“All retailers are hard-pressed to keep up. And most retailers are struggling to stay ahead on all fronts. Whether impacted by various ad format performances, delivery & logistics, social commerce, or the world’s transition to mobile…”

Related: Online vs. in-store shopping: Is there a sweet spot in between?

What malls must do

Malls must become more convenient to win back shoppers.

Convenience is at the heart of why shoppers prefer online shopping to malls, according to a survey from Valassis.

-40% of consumers said that e-commerce’s wider array of product options makes it preferable to shopping in malls.

-The next most popular motivator, chosen by 38% of respondents, was to avoid hectic crowds and parking.

-Not having to travel came in third, with 24% of consumers picking it.

Malls should invest in making their shopping experiences more convenient through a variety of features such as savings, parking, and product selection

Read: All to play for: Why malls are not just a shopping destination

Is the UAE adapting?

Dubai Holding, Emaar launched Dubai Square, a new ‘tech-driven’ mall, nearly double the size of Dubai Mall.

The new mall, which will offer 8 million sq ft of gross floor retail, where online and in-mall shopping seamlessly co-exist, is an attempt to deliver an unprecedented social experience like no other for the digital, connected and tech-savvy consumer.

Costing $2.7 billion, the mall is co-funded by investment company Dubai Holding, and will take five years to build, Emaar Properties chairman Mohamed Alabbar said at an event at the company’s Dubai Creek Harbour office.

Technological innovation permeates every aspect of Dubai Square’s function. Championing ‘omnichannel retailing’, it will offer customers a seamless blend of shopping via desktop, mobile or at a retail store, a statement said.

Digital conveniences will include custom-designed mobile apps, quick checkout solutions, search and barcode scanning applications, radio-frequency identification technology, mobile payments and click-and-collect services.

The fashion offering will include special VIP dressing rooms, smart fitting rooms with interactive mirrors, curated private fashion collections, personalized AI recommendations, 3D printed clothing, and accessories and fashion museums.

Dubai retail sales are projected to reach over $43.8bn by 2021 and serving the estimated 20 million tourists to the city by 2020.

A recent report from Alpen Capital, a leading investment bank, says more than 6.2 million sqm of retail development are expected to take up significant spaces across the GCC countries within the next five years to grow market as much as $313 billion by 2021.

Related: The top reasons why consumers shop online. Note: It’s not discounts!


E-commerce as we know it is set to get a facelift with the launch of Mall.Global – a retail platform that plans to incorporate immersive technologies and operational practices into online shopping.

Mall. Global DMCC is the Dubai-based tech firm behind the $500 million online retail platform, Mall. Global, due to go live by 2020

The platform will offer a personalized experience to each user within a virtual world and employ innovative integrations and technologies to enhance the customer’s experience. Through brand immersion, virtual reality, on-the-ground AR cues, AI, machine learning, cross-platform loyalty and multi cryptocurrency acceptance, Mall. Global hopes to offer a “True Hybrid experience” to customers.

Read: How returning items online, could see you BANNED from shopping

Online sales vs conventional retail

Marmore Mena Intelligence estimated last year that online sales in the Middle East represent a mere 2% of overall retail sales.

In the US, an alarming trend is showing how e-commerce is gaining traction.

Approximately 8,640 stores with 147 million sqft of retailing space are expected to close down between 2017 and 2018.

Marmore said the GCC e-commerce industry is expected to grow at a compound annual growth rate of 30% to rise from $5 billion in 2015 to $20bn at the end of 2020.

Conventional retail in GCC is rising in comparison by 4% in the same period to reach $206bn by 2020, but would still account for 90% of all transactions.

There are currently ongoing retail projects worth $26bn in the GCC.

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