E-commerce is undoubtedly the most talked about industry these days. The global B2C ecommerce sales are estimated to hit $1.5 trillion this year driven by growth in the emerging markets. This is a 20% increment over the past year. The majority of this growth comes from the rapidly expanding online and mobile user bases in emerging markets like India and the Middle East.
As per the forecast by eMarketer, the worldwide business-to-consumer (B2C) ecommerce sales will increase by 20.1% in 2014, reaching $1.500 trillion. The biggest contribution is going to be from the rapidly increasing internet and smartphone user base in emerging economies, adoption of advanced shipping and payment options, and the push into new international markets by major brands.
E-commerce market scenario in Middle East
A report by Pay Pal published last year revealed that e-commerce market in the Middle East alone grew from $7 billion USD in 2011 to 9 billion and is expected to reach $15 billion by 2015. With the local population waking up to the charms and addiction of online shopping and the increased penetration of smartphone usage, Middle East is fast climbing on the charts of significant e-commerce destinations of the world.
There are still some challenges such as the high costs of imports, high customs, taxes and lack of secure online payment solutions, which need to be addressed before E-commerce can realize its full potential here. Froud Jreis, co-founder, CashBasha and Bitcoin Jordan believes that there is still some time before people will switch over to online methods of payment. Until that happens cash on delivery will remain the dominant mode of payment, which is not that good for business.
UAE leads other Middle East countries
Quite unsurprisingly UAE is the market leader amongst all Middle East countries. Back in 2012, the total e-commerce sales in GCC was estimated between $3-3.5 billion, while UAE alone contributed around 50-60% of this total amount. Now moving to present in 2014, E-commerce is all set to become a megatrend and will be valued at $10 billion by 2018 as per a report by Frost Sullivan.
In an interview with Gulf News, Sarwant Singh, Senior Partner at Frost and Sullivan revealed that e-commerce is the fastest growing business in the UAE. Although currently the size of total e-commerce market is estimated at $2.5 billion, it is expected to accelerate and create new job opportunities in retail, finance, accounts and marketing.
New jobs being created by E-commerce Industry
With an expanding e-commerce industry, jobs are also bound to grow. E-commerce is giving rise to a whole new generation of jobs. Job titles such as e-commerce marketing manager, data analyst, SEO manager, UI-UX expert, social media manager are commonly found in this field. All these job opportunities are in digital domains. However these companies also require financial and accounting experts and hence, there are a lot of new accountant jobs in Dubai owing to these ecommerce startups.
Although UAE is still way behind the competition, it is only a matter of time before Dubai turns into the hub of ecommerce industry. The government’s initiatives to transform Dubai into a smart city connected with high-speed network lines is definitely going to positively impact the growth of ecommerce in UAE. E-commerce has become one of the crucial drivers of global economy. With such significant increase in internet usage, it is hardly surprising that internet is becoming a cornerstone for business and communication. UAE, being such an important financial hub, is expected to lead the way for all Middle Eastern countries.