Ecommerce penetration continues to mature and deepen reveals Checkout research
E-commerce in the MENA region has settled into a stable, high-growth era, with increased opportunities for e-commerce players, reveals Checkout’s report Digital Transformation in MENA 2022. The report surveyed over 15,500 shoppers across the Middle East and North Africa (MENA) in August 2022.
In the past 3 years ecommerce has grown faster in the MENA region than anywhere else in the world, with an estimated 209 million consumers transitioning to online shopping during the height of the pandemic. Now, the number of ecommerce shoppers in MENA continues to grow. According to the report, 91 percent of respondents said they regularly shop online, up from 87 percent in 2021. Further, more than half (52 percent) of MENA residents said they shopped more frequently this year, up from 47 percent in 2021. Looking at the GCC, 9 percent of consumers are spending money online at least once per day, which is a 50 percent increase in the past 12 months.
These positive trends are set to continue, with 88 percent of MENA respondents saying they will increase their online purchases over the next year.
Fintech and digital payments adoption continues to soar across the region. Merchants are racing to keep up and as they do so, they continue to innovate and diversify the consumer offering. Consumers, of course, are quick to respond and the competitive landscape sharpens as the benchmark for consumer expectations continues to climb.
The report shows that consumer appetite for digital payments continues to rise, maintaining 2021 trends. 70 percent of consumers across MENA prefer to use a digital payment method - up from 60 percent in 2021. The figure is even higher in the GCC region, which has a much higher digital penetration, with 80 percent of GCC consumers now favouring digital payment methods.
These results mirror the sharp rise in payment apps and digital wallets in the region, where 82 percent of consumers in MENA report using some form of fintech app in 2022, up from 76 percent in 2021. In particular countries such as Egypt, Qatar and Saudi have seen a near doubling in the popularity of digital wallets. Conversely, the use of cash on delivery has declined precipitously in MENA, with a nearly 40 percent drop in the past 24 months.
The increased sophistication of the regional e-commerce landscape is seen in the continued appeal of Buy Now Pay Later (BNPL) options and sCommerce (social commerce). Nearly half of consumers in the UAE and Saudi Arabia used BNPL this year. Across MENA, 39 percent of consumers have used a BNPL option in 2022, up from 24 percent of consumers in 2021, representing 64 percent YoY growth. The penetration of BNPL is higher in MENA compared with US and Europe.
With the ever-increasing average time people spend on social media per day, it is not surprising that a fifth of consumers in MENA say they now frequently shop via social media channels (sCommerce), representing a 43 percent growth in the past 24 months. Meanwhile, the appetite for social commerce has more than double in KSA and the UAE.