Top shopping categories that drive e-commerce growth in MENA Share via Varun Jain November 15, 2022 The thing about the MENA region is that despite being a collection of more than 20 countries, the shopping behavior and the preferences of the people residing here are primarily the same. If not in its entirety, still the majority of it. Of course, there is a massive income divide between the top and bottom countries, and the internet penetration and the maturity of e-commerce markets are all together at different levels, barring the top three countries – KSA, UAE, and Egypt. However, when it comes to shopping online, the shoppers have marked their favorite categories, which is pretty much linear throughout the region. Most regional shoppers shop for fashion products while buying online, which is why there has been an influx of brick-and-mortar fashion retailers taking the omnichannel route not to miss these online shoppers. Giving very stiff competition and closing in on the heels of fashion is the electronics segment, which is growing at an equal pace and is amongst the favorite categories for the online population in the region. These two top categories occupy the top slots for most of the countries in the region regarding e-commerce, and retailers – online and offline – are focusing and investing in providing consumers with more choices and offers to increase their market share further. Personal Care & Grocery, Toys & Kids, and Online Food Delivery are the other most popular categories in the e-commerce space, again driven primarily by the top three e-commerce economies in the region. Let us look at these categories in detail to understand how online shoppers shop for their favorite products. Fashion The growth of fashion e-commerce has surpassed the growth of the entire fashion industry in MENA by over four times but still has a lot of room to grow in the coming years. As a result, we will see a lot of new international and regional fashion brands entering the MENA e-commerce space and exploring new countries. The key to rapid growth for retailers will be understanding the shoppers’ needs, leveraging data to acquire new shoppers with tailor-made offerings, connecting with them personally, and delighting them with meaningful products, services, and offers. Electronics Before the pandemic, electronics was the number one revenue generator for the e-commerce business in MENA, followed by fashion, but during the pandemic, the category slipped to the second spot as more people started shopping online, increasing the share of fashion goods. Not only is electronics popular in the MENA e-commerce space with an average of AED 1300 per cart, but it is also the biggest retail contributor in the region with an average of AED 1400 per bill value, driven chiefly by smartphones that come at attractive prices. Toys & Kids The Toys & Kids apparel segment is one of the most critical categories driving the growth of e-commerce in the region, along with online food delivery. Traditional toys and games are an emerging market in the Middle East and Africa, driven mainly by a recovering economy, increasing disposable incomes, and high birth rates. The same reason why the kids’ apparel segment is also seeing an uptick. The region has witnessed a substantial increase in spending on baby and child-oriented products in the last few years and a general shift towards premium products. Online Food Delivery Few countries in MENA have witnessed tremendous growth in online food delivery, bringing this segment into the top three spending categories in the region’s e-commerce space. When it comes to market share, Talabat leads the race closely, followed by Deliveroo and Zomato, taking the third largest share of the pie. Another food delivery app Careem is also gaining decent traction in the region, setting up the space nicely for healthy competition. According to investment reports, with over $19 million in funding received in Q2 2022, the future of the online food delivery segment looks promising as more activities are expected to transform it further. Grocery & Personal Care While the consumers in MENA are very much comfortable buying personal care items from online channels, the penetration of online grocery is still picking up – which has grown massively during the pandemic. E-commerce players like Souq, Sephora, Ounass, Mac, Noon, and Namshi are providing consumers in MENA with the choicest of products and offers as an incentive to shop digitally and grow the online personal care market; the e-grocery bandwagon is led by Carrefour, Lulu, Instashop, Todoorstep, Nana, and Knockmart. We have covered the expected market size for each e-commerce category in MENA for 2022 and much more insightful numbers about MENA e-commerce and the upcoming Black Friday in our latest report titled, “ArabyAds Annual Report 2022 MENA E-Commerce & Black Friday Opportunities.” Click here to download the report. Also Read: Changing Shopper Behavior: A Back-to-School Perspective on Connected TV Advertising