By Piotr Lewicz, Content Manager, LIONS.
Kearney Middle East predicts that e-commerce will become the main source of growth in the retail sector over the next five years, which has grown from a mere $5bn in 2015 to about $24bn in 2020. Led by the region’s largest economies, Saudi Arabia and the UAE, it is estimated that e-commerce in the Gulf will grow to $29bn in 2021 and reach $50bn by the end of 2025.
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It’s no surprise the extensive lockdowns in the past year have led to the shift of consumer attitudes and more active exploration of online channels for such activities as meeting, learning and shopping. The pandemic has pushed many global, as well as local organisations, to create and use new online platforms to ensure business continuity. According to the “Global surveys of consumer sentiment during the coronavirus crisis” report by McKinsey, businesses, and consumers vaulted five years forward in digital adoption in a matter of eight weeks.
A 70 per cent of global consumers said that they’re spending more time on their smartphones since the start of Covid 19. A 45 per cent of consumers stated that they’re shopping significantly more online, and they expect to continue doing so next year, which suggests that the shift to e-commerce is here to stay.
Whilst there are undeniably plenty of opportunities, there are also challenges for agencies to make the most of the growing e-commerce demand in the region. There is also the question about ownership of the e-commerce experience (as no-one intends to own a faceless brand) and the problem of brand loyalty (declining in the digital space as a result of evolving consumer behaviour), which means that the experiences have to work harder to retain customers.
Agencies are also interested to ensure brand visibility in the ecosystem and learn which technology solutions can be used to support customers to find their favourite brands – and how e-commerce can add value to their experiences. Helping clients deliver the best customer experience ‘all the way to the doorstep’ and making it as efficient as possible is another aspect of e-commerce that agencies are interested in solving.
Adapting to the new demand
“The appetite for e-commerce in the region can be considered as relevant as the need for data, CRM, social and digital transformation. Everything is moving forward […] as an agency, it’s fun times. These are the things we have been actually trying to make happen and now we’re being asked for them with a sense of urgency” says Patou Nuytemans, chief executive MENA, chief digital officer EMEA, executive partner worldwide, Ogilvy.
How can agencies meet the new e-commerce demand?
Developing new capabilities, enhancing existing ones and investing in the right talent will be key for agencies, in order to evolve their value proposition and meet the e-commerce demand.
Striking a balance between creatives and tech-wizards is key to turning a technological template into a compelling and unique e-commerce proposition. Creativity plays a big role in pushing boundaries and digital innovation is a valuable asset that regional agencies can bring to the e-commerce table.
As more people shop online, consumers are and will be seeking more immersive ways to discover and buy relevant products online. Agencies have the right to play and the right to win in designing meaningful and memorable online shopping experiences around:
1. Digital enablement through e-commerce website development (Offline to Online)
2. Discovery commerce
3. Conversational commerce
4. Direct Response advertising
The Role of Partners
“Partnerships are pivotal for agencies to tap into the e-commerce opportunity in MENA. At Facebook, we provide active support and have programs in place to support our agency partners. From developing joint commerce playbooks to working with our marketing partners to enable the development and implementation of various experiences, we are committed to support our partners to win in e-commerce,” says Suha Haddad, director of agencies & ecosystem development MENA, Facebook.
The list of participants of the roundtable on The MENA E-commerce Opportunity. The role of agencies in shaping new shopping experiences:
- Philip Thomas, chairman, Cannes Lions International Festival of Creativity and Dubai Lynx International Festival of Creativity
- Ramez T. Shehadi, managing director, MENA, Facebook
- Suha Haddad, director of Agencies & Ecosystem Development MENA, Facebook
- Leen Fakhreddin, creative agency partner MEA, Facebook
- Nassib Boueri, CEO Middle East & North Africa, Wunderman Thompson
- Roy Haddad, former director Middle East North Africa, WPP
- Tarek Miknas, CEO FP7/MENA
- Patou Nuytemans, chief executive MENA, chief digital officer EMEA, executive partner worldwide, Ogilvy
- Samer Shoueiry, chief digital officer, Publicis Communications