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Online Shopping in the Middle East

Global retailers are increasingly searching for fresh geographic markets to sustain past growth performance and replace traditional bricks and mortar channels that limit their global reach. Retailers today are looking to extend their existing product life cycles across seasons and broaden their networks with innovative supply chain capabilities. The idea is to enter new markets where they are least known and with little tweaking, their products are given an attractive ‘NEW LOOK’ that is ‘HOT’ and ‘MUST BUY NOW’.
 
The Middle East and North African (MENA) region is a lucrative destination for this youthful marketing push because it is burgeoning population that is flush with liquidity and rapidly adopting the latest in social media and e-commerce. This region’s internet users are expected to grow more than four folds and exceed 400 million by 2015.
 
Whilst growth figures are dazzling, they are not uniform across the region, e.g. the Gulf Cooperation Council countries’ leading the pack by far with internet usage rates exceeding 60%. The growth trends show about 100 million daily Google searches, Facebook adding 36,000 new users daily and again 100 million YouTube videos uploaded daily.  Social media is so active that events of Arab Spring were directly attributed to its powerful effect.
 
In the region there is a strong trend showing retailers are turning to online marketing as a shopping tool to manage customer expectations which are more than simply - choice, price and product availability. The new game is focused on speed, service, and experience and yes a definite sense of adventure.
 
Profiles & Patterns of Online Shoppers
 
Just over half of the online shopper cohort is over 26 years old, with two third male and one third female split. Half of these consumers own a shopping card, but prefer to pay cash on delivery for their online purchases.
 
So far, three quarters of online buying is for physical goods. Whilst the internet is still mainly used to research products and services, nonetheless about half of these customers have previously purchased items over the internet in the last four weeks. Just over half of the searches are in Arabic with the balance mainly in English. Indian and some European languages make up a small balance.
 
The main online purchases are for online gaming, computer software, electronics, cloths, entertainment, accessories, home appliances, Health & Beauty and Food & Drink.  The online buying community is generally looking for better offers, easy of product comparisons, wider ranges, reviews and other customers’ experiences as well as wider payment options.
 
Tips for Online Customer Retention 
  
Astute retailers focus on customer retention and expansion of the sales basket to reduce the cost of attaching additional new customers. A number of common key tips are listed below:
 

Branding

  • Offer genuine recognisable branded products that customers know and trust. Consider using social media to build your online image, profile and market position
  • Think life ware, lifetime and value forever – build a ‘good to great’ ‘legend brand’ that ‘lasts’

Quality

  • Ensure product quality and (before and after) service to command premium price. Remember when online you will face cheaper products, currency exchange hurdles and comparable offers

Pricing

  • Price, Price and Price to demonstrate your product’s every day price competitive advantage. Online buyers are predominantly price driven.
  • Bundles, Offers and Exclusive ‘Hot Deals’ that immediately demonstrate value and create immediate and memorable impression

Service

  • Exceed and surprise your customer expectations with service and ease of communication to build up the ‘RAVE’ factor amongst the online social and shopping community
  • Speed and available options to customers are key to avoiding deadly impatience and frustration
  • Offer 100% satisfaction guarantee with free and easy reverse logistics
     
Marketing

  • Be nimble and react to your customer needs and convenience with flexibility and speed
  • Retain and grow your passing online traffic by rewarding loyalty to encourage repeat buying
  • Research your market and get to know your target customer. Listen carefully and act promptly
     
Sales

  • Build a product range with strong length, width and depth by offering new, complementary and modern products. Think what goes with what – cleaver retailers call it ‘associated selling’

Promotions

  • Keep the communication channels open and stay in touch. Tactfully handle difficult blogs, comments and win back lost customers
  • Collaborate and incentivize your online community to pass on referrals and reward them appropriately with meaningful and tactful offers

Etiquette

  • Simplify and personalise repeat purchases with a personal touch and impressionable contact
  • Become culturally attuned and sensitive with lavish gestures of courtesy and consideration – such as greetings and thankfulness
  • Get personal in your approach e.g. felicitation messages during religious and festive occasions, birthdays, anniversaries, VIP excusive member days etc….
  • Advertise and promote respectfully. Avoid cynicism, shock and offending tactics or grouse messages laden with sex, religious and racial innuendoes – it does not sell
 
Entering the Middle East online markets is not difficult, but it does require specialist assistance from organisations with experience and understanding of how business is really done internationally. Engaging with Australian Business Consulting & Solutions gives you access to professional advice, mentoring, briefings, and business partner identification, screening, introductions, market visits, licensing and professional legal advice. If you want to know more about the Middle East contact Camil Gereis at - camil.gereis@australianbusiness.com.au

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Camil Gereis
Manager, Middle East
International Trade
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