As the world’s fastest-growing e-commerce market, UAE is set for further growth in the coming years. Besides being a hotspot for retail, the country has seen significant international investments and collaborations with global retailers like Amazon and Alibaba due to its strategic geographical location. In this blog, we will share some insights on How UAE’s e-commerce market is the world’s fastest-growing.
According to Statista, the global retail e-commerce market saw a whopping $4.9 trillion in sales in 2021, and this figure is expected to soar by 50% to reach an estimated $7.4 trillion by 2025.
How UAE’s E-Commerce market is the world’s fastest-growing
Here are some of the great insights showing the growth of the e-commerce market in UAE:
1. E-Commerce Market in UAE is set to touch $9.2 billion by 2026
Analysis conducted by the Dubai Chamber of Commerce highlights that the UAE e-commerce industry is projected to reach a value of a whopping $9.2 billion by 2026, with a 12.6% share of total retail sales in the UAE by the same year.
2. E-commerce market boom is being driven by millennials
GfK’s Euromonitor International report revealed that early adopters of online shopping (millennials) are driving the growth of the online retail sector in UAE and globally. Among the three countries analyzed by GfK, UAE is the only country where millennials (18-34 years of age) are leading the way in e-commerce spending.
3. The impressive number of online shoppers in UAE is largely attributed to the country’s youth population
According to a study by eMarketer, around 39 percent or one in three online shoppers in UAE are millennials, and 34 percent are between 16 to 34 years of age. The millennial and younger generation is an increasingly important share of the general population.
4. UAE has been able to attract a significant number of international brands through collaborations
Amazon and Alibaba announced that they have begun to work together to create a platform that will help small and medium-sized entrepreneurs (SMEs) sell their products and services on the e-commerce platform. Additionally, it was revealed that the two companies would introduce exclusive features like “Instant Shipping” for products manufactured by those customers. Along with Amazon, several other global retailers, including Chinese fashion giant Zara, US retailer Walmart, and French luxury brand Channel, have also entered into agreements with local players in the country.
5. Local Players Becoming Dominant Forces in E-Commerce
The UAE’s retail market has posted strong growth in recent decades, and as a result, several local players have emerged as dominant forces. This will infuse the growth of e-commerce in the coming years, boosting the ecosystem for business opportunities in e-commerce.
6. The online retail market is dominated by fashion and electronics products
Fashion, cosmetics, personal care products, mobile, and home appliances continue to dominate the market in the UAE e-commerce ecosystem.
The online shopping boom is here to stay. As the number of internet users in the country continues to rise and technology keeps advancing, the size of the e-commerce market in the UAE is set to expand significantly.