High Costs Holding Back UAE E-Commerce Purchases

The majority of the UAE’s online shoppers have halted purchases from e-commerce websites due to cost increases, according to YouGov’s E-commerce Index.

Around 43 per cent of UAE shoppers abandoned their online shopping basket in the last three months, while 31 per cent decided against an online purchase because they could find cheaper options.

Almost 26 per cent of respondents blamed e-commerce shopping sites for adding extra fees at check out.

Despite high levels of mobile penetration rates and a flourishing retail market, the UAE lags behind in e-commerce adoption. Experts have traditionally attributed such sluggish rates to poor internet security and payment processing tools, but the latest research indicates that cost discrepancy is also an issue.

“If local brands want to meet their projected growth rates and become household names in the UAE, they are going to have to be 100 per cent transparent with customers, in addition to delivering a unique experience online – be that through free delivery, promotions or lower prices,” said Sundip Chahal, YouGov’s CEO.

The index also charted the top online purchase channels used by UAE residents, finding around 35 per cent of those who shopped online in the last three months used their smartphones, while just 23 per cent used tablets.

Concerns regarding online security appeared to have declined among UAE residents, with almost 57 per cent using their credit card for online purchases. Around 48 per cent still opted for cash-on delivery, the research showed.

French hypermarket chain Carrefour UAE was rated the top value for money brand to online shoppers, followed by Cobone and Groupon.

Carrefour UAE was also rated the top brand in terms of trust among online shoppers followed by another retail chain, Geant Online.

MENA’s e-commerce sector has been steadily growing in market share alongside a thriving retail sector.

According to Paypal, online sales in the Middle East amounted to $11 billion in 2013, with figures forecast to reach $15 billion by 2015. Saudi Arabia and Egypt were named the top markets for e-commerce in the region.