Amid the ever-evolving consumer needs accompanied with the rise of the digital transformation age, brands moved to unlocking the potential that lies in digital commerce channels. 

We’ve exclusively chatted with Nagham Akileh, eCommerce Strategy Senior Director of OMD UAE, for her insights on what eCommerce means for brands of the region. 

BB: The eCommerce market in the Middle East has been on a massive rise, unlocking a wide multitude of opportunities for retail and non-retail brands as well. Can you shed some lights on how eCommerce can be a pivotal growth imperative for businesses?

NA: E-commerce is growing at an average of 15-25% year-on-year in MENA. However, there’s a caveat for this growth: around 50% of retail transactions are cross-border; due to lack of options locally. This has been a missed opportunity by brands in the region, but with Noon and now Amazon in the region we expect to see cross-border shift to local options as more SKUs become available.

Nagham Akileh – OMD UAE

There’s no doubt businesses need to invest in an ecommerce presence, whether it’s direct-to-consumer (D2C), through marketplaces or other partnerships. Simply put, consumers are shopping online and if a brand is not there, they will find alternatives to choose from.

BB: Global giants like Amazon and eBay were the trailblazers at the forefront of the eCommerce industry, revolutionizing the whole customer experience equation. What does eCommerce mean for consumers? and how it’s reshaping the way consumers engage with brands?

NA: Younger consumers are a mobile-first generation with a diminishing attention span and want to express who they are, so ultimately, they want to engage with brands that can offer Convenience, Value, and Personalization. 

Consumers today can discover thousands of options at their fingertips and shop with just a few clicks. 56% start their online shopping journey with search engines, and this is the first touchpoint they engage with brands; ensuring your brand is visible from the start is just as important as the journey they take on your site or app, which should also be intuitive and simple.

They also want to make sure they’re getting the best their money can buy, and they’re able to compare product and price on-the-go. No two paths to purchase are the same, so beyond price, brands need to ensure they have relevant and up-to-date information available across touchpoints, as well as product variations, to nudge consumers to choose them, and if they drop-off then engaging with them to stay within the consideration set is important. 

Many ecommerce players compete on the first two areas in the race to the bottom, but Personalization will be the race to the top, and this goes beyond allowing customers to personalize products, but also connecting the in-store experience with the online one, and precisely triggered communication across touchpoints throughout the customer journey. This is where omnichannel comes in, leveraging technology to streamline the experience across touchpoints.

BB:  Due to the scaling demand for technology in the online retail scene, brands hand in hand with retailers and wholesalers must implement omnichannel experience strategies. Please comment.

NA: There are over 7000 martech solutions available at the moment, and this number goes up once we factor in other systems like supply chain management, process automation, enterprise resource planning (ERPs). Having the right tech stack is essential to implementing an omnichannel experience properly. Having said that, there are several aspects that need to be considered in conjunction with technology to make an omnichannel strategy successful:

  1. Auditing the current customer journey. All too often we see companies pick a tech solution to solve one problem without a thorough audit, only to find that it operates in silos. An audit avoids this pitfall, because once the gaps are identified, we can figure out which stakeholders to involve and the requirements technology needs to fulfill in the solution. 
  2. People are an important component to digital transformation and supply chain optimization; technology can play a role in bridging silos, streamlining processes and improving the experience for employees, which will ultimately translate to an improved and unified experience for consumers. 
  3. Implementation is a journey with phases and iterations. The buck doesn’t stop with the first rollout, and the only constant is change.

BB:  What are the considerations brands should consciously be aware of on their road to a successful digital transformation strategy?

NA: There are many considerations, but they can be grouped under two buckets: Tech and People

  • Tech- Companies that deploy tech solutions are more likely to succeed in transformation efforts than those who don’t. From day-to-day tools to streamline communication and collaboration, to martech to other systems for areas like process automation, Supply Chain Management and Enterprise Resource Planning, brands need to make sure a tech strategy is in place and the tech deployed meets business requirements. 
  • People- Engaging people across all levels of the company during all stages of transformation also plays a key role in success. This includes getting people’s buy-in on the purpose for digital transformation, having digitally-savvy people help build capabilities internally to future-proof your workforce, and collaboration across departments on transformation initiatives ensures there’s a sense of ownership and generates the positive momentum needed to successfully transform.

 BB: In this digital era, countries embrace eCommerce to put themselves on the global map of ‘digital economies’. How can eCommerce help countries of the Middle East become countries with a ‘digital economy’?

NA: The region is already at an advantage due to a large youth population, who are growing up in a digital world so adopting new buying patterns will not be an issue. And we don’t need to look far to see the economic impact of a country going digital and embracing ecommerce. The UAE is ranked as one of the top three Stand Out countries by Tufts Digital Evolution Index due to the high momentum and digital advancement the country has; they are leaders in driving innovation in digital economies and they were able to achieve this in two ways:

  • Embracing e-commerce on a government level, by launching user-friendly e-government initiatives. In Dubai for example, most government services can be completed with a few taps via an app on the phone, and they introduced e-dirham prepaid cards as a payment method for those not comfortable using their credit card information online. These are essential services that affect every resident, so bringing them online and making them easy to use (this is important!) can speed up e-commerce adoption in the country. 
  • Investing the country’s digital infrastructure, namely internet and mobile connectivity, and a healthy startup ecosystem that enables scalability to launch products and services online while fostering innovation along the way. Souq (acquired by Amazon for $586mn), Namshi, and Careem (acquired by Uber for $3.1bn), are examples of a country’s digital infrastructure working well for its economy. Other countries in the GCC are following suit by developing their startup ecosystems.

If we look to Levant and North Africa though, connectivity is still a challenge. For example, both Egypt and Lebanon have thriving startup ecosystems, however internet and smartphone penetration in Egypt sit at 43% and 28% respectively, while less than 10% of mobile users in Lebanon are enjoying 4G/LTE connections and 3G coverage is still relatively poor in many areas. So, in the long run, scalability of any ecommerce startup or initiative will be hampered and many will look to relocate to enable their growth or go out of business. The good news is that governments are prioritizing connectivity, with Lebanon’s ‘2020 Telecom Vision’ development program and Egypt’s “eMisr National Broadband Plan”.  Ecommerce will then naturally flourish as a result of ease of connectivity, accelerating countries into having a digital economy.