Online shopping in the Middle East set to boom

Shopping in the Middle East and around the world is set to become more sophisticated as an increasing number of international retailers sell their products online.

According to research published this week by CBRE, the amount of online shopping conducted globally is set to double. The property consultant surveyed 50 leading international retailers with a combined worldwide network exceeding 32,000 stores.

They said while online sales currently represent 5 per cent of their total, in two years they estimate this will double to 10 per cent.

Although 70 per cent of international retailers view their businesses as based in physical stores, 63 per cent say by 2014 their businesses will be fully integrated with online shopping and mobile apps. The survey found although online shopping remained in its infancy outside the developed markets of the United Kingdom, the United States and Australasia, retailers felt online retailing would play an increasingly important role in emerging markets including the Middle East, Asia Pacific and Central and eastern Europe.

With a dearth of postal services hampering the growth of online shopping in many parts of the Middle East, two thirds of retailers predicted over the next two years, shoppers would be ordering online and picking up their goods in stores. When asked how they would do more business online, 80 per cent of respondents said they would offer shoppers the chance to use online kiosks in their stores.

Another 77 per cent said they would offer mobile apps or smartphone-enabled websites within the next two years.

"In the Middle East, participation in multi-channel retailing is still in its infancy with consumers immersed in an established mall culture that has become a focal point for everyday life and an avenue for social interaction among the region's growing youth population," said Matthew Green, the head of research & consultancy for CBRE Middle East. "However, there has been notable growth in participation levels for Web-based auction sites, group discount sites and flight and hotel bookings engines.

"To be successful online retailers will have to become more creative in their offer in order to entice shoppers away from organised formats," he said.

lbarnard@thenational.ae