Top 10 e-commerce trends in the UAE for 2020

In the UAE, commerce has transcended physical and digital channels. The “e” in “e-commerce” is superflous.

A unique feature of UAE’s e-commerce growth is actually the thriving mall culture. Traditional brick and mortar retailers have welcomed the adoption of online culture and do not treat e-commerce in a confrontational mode, unlike other countries.

When you have a Government that leads the adoption of online payment platforms and has launched initiatives such as “Smart Dubai” that leverages emerging technologies such as Blockchain and Artificial Intelligence, you can expect something different.

From the massive advertising campaign of a App based Loyalty Program called Share by one the leading mall developers Majid Al Futtaim to another massive marketing investment to promote home delivery of fuel, yet again using a App, these are exciting times for online commerce in the UAE.

So, what are the top 10 e-commerce trends we should expect in the UAE now that we are not only entering a new year but also a new decade? Get that cup of your favourite coffee (or karak chai) and read on.

Top 10 e-commerce trends in the UAE in 2020


Among the top 100 e-commerce sites in the whole of the MENASA region, the UAE is home to more than 10 focusing on B2C products, an indicator of both demand and supply. UAE e-commerce companies include multi-product marketplace sites such as (which was acquired by and rebranded as Amazon),, and; fashion sites such as; single retailer sites such as; and grocery retailers such as Multi-product and multi-brand marketplaces attract 63% of the overall unique user base in MENASA.

Customers in the UAE still prefer to pay for e-commerce transactions using credit rather than debit cards. However, over the last three years, customers have demonstrated increased comfort in using debit cards to pay for e-commerce purchases.

Online payment options such as Visa, Mastercard, PayPal existed for many years and we recently saw Apple Pay, Samsung Pay get into the fray. This is just the beginning.

In 2020, we will also see customer adoption of eWallet – the app to handle all your payments. With eWallet, you will be able to send & receive money on your UAE mobile line, pay Etisalat bills & merchants. With no registration fees, no minimum balance & no bank account required.


Government initiatives intended to promote innovation, entrepreneurship, and a cashless economy to foster financial inclusion and greater transparency have given a significant boost to e-commerce development in the UAE. In the 2018 Government E-Payments Adoption Ranking (GEAR), the UAE scored 73.5, ranking 27th among the 73 economies studied, and inched closer to the mature category, which begins at 75.1.

The government is driving a Smart City agenda in both public and private spheres. As a strong advocate for the UAE’s overall innovation and financial technology agenda, the Central Bank of the UAE has finalized a National Payment Systems Strategy that aims to create a secure, future-proof payments ecosystem that best supports the UAE’s objectives of a digital economy and a cashless society.

A digital, lean, connected “paperless, cashless government, driven by cutting-edge, disruptive technologies, defining the government of the future now,” is part of the Smart Dubai 2021 initiative. As part of the overall cashless agenda, Dubai’s DED launched a mobile payment solution called emPay, a digital wallet that works with partners across the payments ecosystem.

And going a step further, the Government has now launched UAE Pass, a single digital identity for all citizens, residents & tourists. UAE Pass is your personal digital identity for secure identification. It will give you access to various signature and authentication services within the United Arab Emirates. And we will see merchants integrating with UAE Pass thus having no need to remember usernames & passwords for consumers and a safe tool for merchants to validate their consumers.


Physical retailers will bridge the gap between online and in-person data collection with cameras, facial recognition, tracking beacons, Point-of-Sale (POS) data and traditional digital measurement and analytics.

Just as online retailers can understand the movement of users on their site, brick-and-mortar locations will use WiFi, sensors, Radio Frequency Identification (RFID) beacons and more.

The goal is to identify high-traffic areas in the store, overlooked products, dwell time – even product movement from rack to fitting room.

From real-time merchandizing to making data-based decisions about physical interaction management and store planning, the age of real-world data is upon us. Combined with web, mobile and social data, in-person data collection and analytics brings retailers much closer to a truly 360 degree customer experience.


2020 will be a tipping point for “fast and free shipping”.

Same-day delivery will be a norm rather than exception. Express Delivery will come at a cost but there will be cut-throat competition of who can deliver fastest. The technology and commerce aspect of this cannot be overlooked though. Location mapping technologies need to be enabled in all e-commerce platforms vying to do this (just like the Food Delivery Apps) and the cost for express delivery will always be a price-war between merchants. Eventually, there will be a correction to this model, because of the actual costs involved in the logistics.

On UAE streets, an increasing number of riders from delivery aggregators such as Talabat, Deliveroo, Uber Eats and Spoonfed are zipping around to deliver meals to consumers. Consumer reliance on these food delivery apps to compare options and order from their restaurants of choice is visible in the growth of transactions in that category.

The UAE consumer is a proactive, early, eager adopter of technology, partly due to demographic factors. As with other GCC economies, the UAE also has a high percentage of young population, attributed to demographic transitions, along with diverging fertility and population growth rates. The youth bulge – the percentage of the population that is under the age of 25 – is 34% in the UAE, with the median age of population being 33.4 in 2015, estimated to be 34 in 2020.

The UAE’s young population comprises digital-native millennials (born between 1981 and 1996) and Gen Z (born between 1997 and 2012). Millennial consumers came of age during the internet explosion and are at ease with technology. Gen Z has grown up surrounded by always-on technology, taking for granted social media, constant connectivity and on-demand, near-instant solutions. These digital-native consumers seek convenient shopping experiences and drive e-commerce globally.

The UAE consumer also enjoys infrastructure advantages. Mobile penetration is high and 94.82% of population used the internet in 2015, with 19,826,224 mobile cellular subscriptions in 2017, amounting to 210.9 subscriptions per 100 inhabitants4 . UAE residents are among the top 10 globally when it comes to spending time on the internet and social media on any device, averaging seven hours and 54 minutes daily.


Frequent flyer points, cash-back rewards, or coffee-cards from your local café. Whatever variation chosen, it’s clear that reward and loyalty programs are an important tool to drive business sales and visibility. But these are paperless times, so it’s all about having an app-based loyalty program.

Leading retail and leisure pioneer Majid Al Futtaim on Friday launched a new app-based lifestyle rewards programme called Share, which allows customers to earn and spend points at 2,300 outlets in its 16 shopping malls and 11 hotels in the UAE.

For digitally-minded members, the Share wallet provides real-time earn, spend and contactless payment capabilities. Other options include receipt scanning to earn points and the Majid Al Futtaim Mall Gift card to spend points in any store in the company’s shopping malls.

And this was followed by an advertising blitzkrieg that included billboards at prominent locations across UAE, print and digital campaigns.

Taking a cue, many prominent brands, merchants, developers will join the bandwagon. Customers will be spoilt for choice of rewards and consumerism will be driven online.


The UAE enjoys an advantage as a major global transhipment hub with the port of Jebel Ali and Dubai International Airport (the sixth busiest cargo airport in the world) providing a high standard of logistics infrastructure necessary for e-commerce to take place. Targeting e-commerce specific logistics, in June 2018, Emirates Skycargo signed an MoU with Cainiao Network, the logistics arm of Chinese Alibaba group, aimed at making Dubai one of the e-commerce major’s six global logistics hubs.

Improving logistics has been identified as a key driver for e-commerce growth. Moving away from solutions typically orientated to brick and mortar sales, retailers have fine-tuned e-commerce logistics to support growth and scale. The e-commerce supply chain has a different set of opportunities and challenges compared to traditional stores. This is being addressed by technological innovation within the logistics and manufacturing sectors.

Using emerging technologies such as 3D printing, active RFID tracking, or GPS-driven solutions make e-commerce logistics different from traditional logistics. e-commerce also has a different order cycle that is counted in hours and minutes instead of weeks and orders are seasonal and fragmented as opposed to being stable and predictable. Instant gratification requires robust customer service solutions for B2C rather than B2B consumers. Distribution is demand-driven rather than supply-led, with smaller shipments to multiple destinations taking the place of concentrated bulk deliveries.


In 2018, $273b was spent on digital ads globally, 39% of all advertising in the world. Combined, Google (Alphabet) and Facebook take in 61% of all digital advertising spend in the US, monetizing the 12 hours the average American spends interacting with screens every day. Analysts expect Google’s online ad revenue to increase 22% in 2019, as merchants continue to shift their budgets to digital.

The new dot com bubble is here: it’s called online advertising

Back in the UAE, we will see brands and merchants create content and experiences that get talked about – simultaneously gathering data and creating direct connections with consumers, instead of relying on the “walled gardens” of Amazon, Facebook and Google.


After “free”, two-day, one-day and same-day shipping comes shipping directly into the trunk of your car / in your garage / in your refrigerator. As the shipping wars escalate, carriers and merchants are looking to increase the convenience of deliveries by going into people’s homes and cars thanks to remote access technology.

Cafu, the UAE’s pioneering fuel refill app recently faced the news of competition from a big company Emirates National Oil Company (ENOC); and that is actually good news! Rashid Al Ghurair, founder and chief executive officer of Cafu, said that Enoc’s entry into the fuel delivery space will only drive awareness of such a service, and this will benefit both companies.

Similarly, we will see other bold moves by e-commerce operators to deliver straight to the refrigerators. This, otherwise unthinkable act, is a definite possibility in the UAE, with its stringent security measures and high marks on safety.

Aside from convenience, these methods of delivery aim to make grocery shopping easier/possible/safer (avoiding thawing or melting ice cream, for example) as well as reducing package theft which, in turn, may reduce the cost or anxiety of delivering/receiving valuable items, such as consumer electronics or jewelry.


The rapidly expanding Middle Eastern start-up ecosystem has attracted the attention of regional and global venture capitalists. In prominent examples, global e-commerce giants have used acquisition as a route to enter the regional market to tap into its growth potential.

Whether it is the Mohammed Bin Rashid Innovation Fund Accelerator launched by the UAE Ministry of Economy, Saudi Arabia’s Vision 2030, or the $150 million Oman Technology Fund, fueling the start-up and innovation culture is a key priority for governments in the region.

In 2018, 366 MENA-based start-ups raised a total of $893 million in funding, a 31% increase from 2017, which saw $679 million being invested. MENA-based VCs such as Wamda Capital, STC Ventures/Iris Capital, Middle East Venture Partners (MEVP), and BECO Capital have been involved in several high profile start-ups. The MENA region has now started attracting the attention of global venture capital firms as well.

The UAE remains the most active in attracting funding, with UAE-headquartered start-ups garnering 30% of all deals and 70% of total funding. This is attributed to continued government support, corporate venture interest and growing investor appetite for start-ups.

Local majors are investing in the space. Emaar Malls Group, which was aggressively competing to acquire, acquired a 51% stake in the Dubai-based e-commerce platform Namshi for $151 million in May 2017. It also launched the multi-product marketplace, which, in late 2017, has started an online grocery platform. also signed an agreement with eBay in June 2018, enabling its customers to purchase products listed on eBay in the US and other countries globally.

In 2020, we may not experience a major takeover such as Souq or Careem, but the number of acquisitions will steadily rise and that is good!

In conclusion

With future-ready infrastructure and policy focus on a cashless society, the UAE consumer is only a click away from e-commerce, whether at home or on the go. UAE e-commerce transactions are growing at a healthy pace, compared to both developing and mature benchmarks. If you are living in the UAE, consider yourself as a contributor towards the booming technology driven economy and do more transactions online.

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Kiran Borkar

Having been part of the Internet Industry since the late Nineties, he believes Nostradamus goofed up by not predicting how the World Wide Web would change the world.

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