A significant jump in UAE online retail sales are expected this weekend as White Friday, the de facto start of the Christmas buying season, arrives today.
Souq.com, one of the region’s biggest online retailers, said average daily sales increased tenfold on Wednesday, effectively the first day of the White Friday weekend, compared to a year ago, with two out of every five sales coming from the mobile app.
White Friday offers discounts and bundles from hundreds of suppliers and thousands of products that are typically sold cheaper than at any other time of the year.
This will be the event’s second edition after Souq.com introduced White Friday to the region last year.
Plug-Ins has also joined in the event while promoting its new website, with White Friday discounts running for five days.
“Online retailing is a fraction of our business, but with events like White Friday we expect a sharp increase in sales,” said Omar Abushaban, the general manager of Plug-Ins. ”I think in the next couple of years it will account for 5 to 10 per cent of our business. White Friday will see us offer exclusive deals on the iPhone 6S only available though our website. We will also have discounts across the smartphone range including printers and hard drives.”
The event is known as Black Friday in the United States, where the move began. It is known as Black Friday because it is, typically, when retailers move into profit and get back into the black.
Over the past decade it has gained traction across the world and now is a key component of retailing strategy, not just online but with bricks and mortar outlets matching the online offerings and enticing the buying public to start spending sooner. So could online discounts spread to the UAE’s malls?
Unlikely, says one industry leader.
“Bricks and mortar in the UAE does not need to join in with the White Friday sale because of all the other sales events we are involved in,” said Neelesh Bhatnagar, the chief executive of Emax Electronics. “We have Abu Dhabi Electronics Shopper on right now, Gitex before it and the Dubai Shopping Festival starting on January 1, 2016 – a month-long sales festival. Online sales here are less than 1 per cent of the retail spend, so it needs a focus. ”
With smartphone penetration at 74 per cent in the UAE and mobile commerce set to top $3 billion in 2015, according to Euromonitor, the online opportunity for retailers is growing. The boon in online sales also drives sales for the region’s logistics companies.
“We see good growth for not only domestic or regional e-commerce players,” said Iyad Kamal, chief operating officer of Aramex. “Also global e-tailers are tapping into the UAE market, the UAE is an important destination to sell their services to. The country’s online shopping appetite in 2015 has grown faster than other countries in the region due to its diverse professional population base, advanced technology infrastructure and high credit card penetration.”
Internet spending in the UK on Black Friday alone is expected to increase 32 per cent on last year according to Experian-IMRG, which will mark the first time that online retail sales in the UK surpass £1 billion (Dh5.54bn) in one day.