Register for our free newsletter

 
 
Latest News

Massive potential for e-commerce to thrive

Ahmed Alkhatib, founder of MarkaVIP, says the Middle East region is not particularly optimised for e-commerce.

June 27, 2013 11:47 by



A lot has been said about the e-commerce industry in the Middle East; it’s the world’s fastest- growing market, internet penetration is incredibly high and online payments are safer and on the rise.

Last year, it was predicted that cash on delivery (COD) – which constituted roughly 70 per cent of online transactions in the region – would begin to die out as customers turn to the comfort and convenience of online payments. And yet, during a panel discussion at ArabNet’s Digital Summit, we were told that, contrary to expert opinions, cash on delivery now represents 75 per cent of online transactions.

How is it that, with an average internet penetration of 40 per cent in the region (compared to a global 34 per cent), customers still prefer an arguably old-fashioned model such as cash on delivery?

“I don’t think it’s necessarily an increase of interest in COD, but an interest in shopping online,” says Ahmed Alkhatib, founder and chief executive of one of the region’s largest e-commerce players, MarkaVIP.

“What you’re seeing is a massive exodus of people who would normally shop offline that are now shopping online.” Alkhatib, who founded the company back in 2010, adds that customers tend to use cash on delivery for the first few purchases, at least until trust can be built.

After the first couple of deliveries, they realise that paying online is much more convenient, he says.

“With online payments, I think it’s going to be a natural progression,” he explains. “As companies like us mature and become household names in the market, people will trust our services. It happened in the United States and Europe, and it’ll happen here.”

Alkhatib says that, when the company was first launched, he quickly realised that the region, particularly from an infrastructure perspective, was not logistically optimised for e-commerce. There were (and still are) many barriers to entry; laws on imports, cross-border transportation and customs laws.

However, given that all the existing major players have managed to overcome these barriers, he believes in the massive potential this region has to offer.

“I think the industry will grow tremendously over the next three to five years,” he says.



Tags: , , ,

5

Video: Porsche discusses the region’s hybrid market

Omar Al Mathno, national after sales manager, says it’s going to improve

August 23, 2015 9:35 by
 
sam1

Video: Samsung Galaxy Note 5 and S6 Edge Plus

Hayssam Yassine, head of imagery and mobility at Samsung Gulf Electronics talks the latest releases

August 20, 2015 1:20 by
 
coffee and coffee beans

Video: ‘The UAE consumes 3.4 billion cups of coffee per day’

Let’s hope at least some of it is decaf

July 30, 2015 12:00 by
 
Capture

Video: What are the latest automotive trends?

Carmudi reveals all

June 28, 2015 2:54 by
 

TV

Rss More TV  
 
5

Video: Porsche discusses the region’s hybrid market

Omar Al Mathno, national after sales manager, says it’s going to improve

August 23, 2015 9:35 by
 
sam1

Video: Samsung Galaxy Note 5 and S6 Edge Plus

Hayssam Yassine, head of imagery and mobility at Samsung Gulf Electronics talks the latest releases

August 20, 2015 1:20 by
 
business, technology, people, deadline and team work concept - s

Video: Are you planning to start a small business?

Here are 10 things you NEED to keep in mind…

August 16, 2015 12:01 by
 
Airport Commuter Business Travel Tour Vacation Concept

Dubai gears up for a record-breaking summer in 2015

dnata expects to handle more than 50,000 flights between June and August

August 9, 2015 9:00 by
 
Paypal Website On Apple Ipad Air

(VIDEO) MasterCard: How to make sure your digital payments are secure

Heads-up: Sharpen your hacking skills

August 5, 2015 9:00 by
 
coffee and coffee beans

Video: ‘The UAE consumes 3.4 billion cups of coffee per day’

Let’s hope at least some of it is decaf

July 30, 2015 12:00 by
 
IMG_5419

Video: Dubai Sports World

The UAE’s largest indoor sports facility

July 22, 2015 3:31 by
 

Leave a Comment