The GCC’s e-commerce sector is receiving a major boost from the high mobile penetration rates in the region, according to Ronaldo Mouchawar, founder and CEO of Souq.com.
Smartphone penetration in the UAE is close to 200 per cent, one of the highest rates in the world, with Saudi following close behind.
“Early on e-commerce lagged in the area because it didn’t have enough traction in terms of the user-base,” Mouchawar told Gulf Business.
“But I think mobile is changing that. Now there are more suppliers and more offers for devices and there is better connectivity from telecoms operators.
“We are seeing growth pick up fast enough so that we will catch up with the rest of the world and I think one of the key factors is more users and connectivity through mobile is bridging quite a bit of that gap,” he said.
From their end, e-commerce players should ensure that the buying experience is simple and that they provide competitive prices and good after-sales support and service. That will keep up the traction, explained Mouchawar.
Souq.com, one of the biggest e-commerce players in the Middle East, announced earlier this week that it had received $75 million in additional funding from Naspers.
A portion of that amount will be invested in developing mobile technologies, Mouchawar confirmed.
The company currently receives around 40 per cent of its traffic from phones or tablets. “So mobile is quite significant. In markets such as Saudi Arabia and Kuwait, these metrics are even further ahead,” the CEO said.
“I think it’s all about the convenience and users are getting very comfortable with this connectivity.
“It’s not just e-commerce; consumption of video on phones and tablets is also significantly on the rise. I think there has been a lot of investment by regional telecom operators to promote the spread of mobile – things like LTE and 4G are on par with any country in terms of the services. And all the latest gadgets are here. Hence all of this is creating a whole new ecosystem, which is mobile based,” he explained.
Going ahead, Souq will focus on creating a mobile-specific experience for customers, he said.
“With mobile, the screen is very different and you have to be a lot more personal. So we will focus on personalisation and build a talent base to support technology around the mobile platform and apps.
“We understand that mobile is definitely one area where there is room for us to lead because of the high mobile and smartphone penetration rates.
“So it is something we are excited about and something we can innovate around,” Mouchawar added.