– The Global Cross-Border report shows Middle-East as one of the regions with the highest incidence of cross-border online shoppers
– UAE consumers continue to increase their online shopping. In 2016, 68% of adults in UAE shopped online in the past 12 months, increasing from 63% in 2015
– UAE is one of the top 3 countries surveyed followed by Egypt and Nigeria in Europe, Middle-East and Africa that have the highest average proportion of cross-border purchases being made on a mobile device (smartphone or tablet)
– USA cited as the most popular cross-border online shopping destination for UAE online shoppers, followed by India and China.
Today PayPal and Ipsos released their third annual cross-border commerce report. The global insights research investigated the online domestic and cross-border shopping behaviors of more than 28,000 consumers in 32 countries, to unearth opportunities for consumers in the world’s commerce revolution.
The Global Cross-Border report shows Middle-East as one of the regions with the highest incidence of cross-border online shoppers
Cross-border online shopping is common in the UAE. Almost half (46%) of the UAE online shoppers revealed, in the past 12 months, they purchased online from websites in countries outside of the Emirates. The main impetus for UAE online shoppers to buy cross-border online are – 47% said secure payment gateways, 44% said free shipping 43% mentioned proof of product authenticity.
The future of online spending- why we will shop more
Overall online spending continues to grow in the UAE, forecasted to reach AED 33 billion by 2018. The research revealed that 68% of online adults in UAE shopped online in the past 12 months, as against 63% in 2015.
Forecasts predict an increase in online spending, with 48% of online adults surveyed, saying they will increase their online spending in the next 12 months, citing convenience of shopping online (selected by 67% of those who predict an increase in their online spend), planning to save 35% and cause a 29% change in their disposable income as reasons for the expected increase.
The rise of mobile commerce in the UAE
With high rates of mobile penetration in the UAE, online shoppers are increasingly opting to make purchases on their mobile devices. As a result, there has been a spike in purchase of smart phones to the extent of 29% between 2015 and 2016 valued at close to AED 10 billion. The momentum is expected to continue into 2017 with a further 27% growth.
The research revealed, 76% of shoppers had used smartphones to make cross-border purchases online, while 35% have used tablets and 18% have used Smart TV/consoles.
“The UAE’s commerce revolution is well underway, and backed by the country’s diverse and truly global population and high mobile penetration rates, consumers are looking internationally to source their favorite products and services – ranking themselves in the top three countries making cross-border purchases from a mobile device,” commented Kıvanç Onan, Senior Regional Director, PayPal Middle-East and North Africa.
What, where and why consumers are buying
The study revealed, 47% of the shoppers made their on line purchases in the Travel and transportation category in the past 12 months, while 33% purchased event tickets such as for the cinema, theatre, concerts and 40% purchased clothing/apparel, footwear and accessories from foreign websites.
When considering where to buy from, 44 percent of respondents agreed that they trust online stores from other countries as much as stores from the country they live in.
Cheaper prices, greater variety and availability are the reasons cited by respondents for on line shopping as their choice of purchases. The results show 61% of shoppers from USA mentioned better prices as the charm, while 72% polled for India and 77% voted for China.
Chinese on-line websites offered new and interesting products according to 62% of UAE consumers polled who shop cross-border while 59% preferred Indian websites due to option of varied payment methods.
Security drives choice of payment method
Payment methods have always been the yardstick for the success of E-commerce websites. PayPal has ruled the roost in the E-commerce sector for many years. The UAE consumer base prefers PayPal as their preferred payment method due to security (55%) and brand worthiness (42%).
Research done by PayPal also corroborates the results of Ipsos in as much as the buying patterns of consumers in the UAE are concerned. The UAE has been considered as one of the top destinations for on-line purchases due to the boom in the smart phone sector. USA, India and China have continued to be the top three cross-border shopping destinations for the UAE consumers. The future of online spending for UAE has great potential for growth and estimated to increase in the next few years.