New functionality within the platform to be launched in cooperation with government entities in the UAE and Saudi Arabia
E-commerce company noon, which launched last year, is set to introduce a new online auction functionality within the platform in cooperation with government entities in the UAE and Saudi Arabia, Arabian Business has learnt.
A source close to the development said online auctions on noon will be a breakthrough as the new functionality will use the latest technology.
Online auction is not new to the region; a few start-up companies were launched in the past decade, many of them not hitting the mark.
Another e-commerce player Souq.com had launched online auction but the functionality was closed shortly after. Its site now states that “it is not an auction house nor a bank, and does not offer auction or banking services.”
In the region, online auctions are successfully held for vehicle number plates as well as in art, with global houses such as Christie’s and Sotheby’s recording strong business traction in the Middle East.
“But when it comes to retail, we do not have a credible local player,” said the source, not wanting to be identified. “It is estimated that about 30 to 40 percent of the share of global ecommerce is accounted by online auctions.”
The source said the advantage of noon’s online auction functionality will be that “business is conducted in the region – with buyers and sellers in the region having easy access to the product. They do not have to wait days together for the auction and then again for the product to reach them. Everything will be quick, and most importantly, transparent.”
Once the online auction on noon rolls out, customers can hope to buy a wide range of products at “their price”.
For instance, each product can be priced at just 1 percent of its market value. For example, a smartphone priced AED3,000 will be available for bidding at just AED30. Customers can “bid their price” and the product will go to the highest bidder.
“The bidding mechanism is currently being finalised,” said the source.
“noon has the advantage of partnerships with a number of local retailers – not just the large business houses but also start-up enterprises. These startups and SMEs are going to benefit tremendously from these online auctions on noon.
“There will be regular listings, reverse price auctions, Dutch auctions, flash sales, featured items – everything that will bring value to both buyers and sellers,” the source added.
Most online auctions are not transparent, and bidders do not have any way to ensure the legitimacy of a higher bid or the quality of the product. “The important factors in any online sale is immediacy and quality; customers must receive their product at the fastest possible time and as per the quality they expect. Also, online auction must benefit both the seller and buyer.”
A spokesperson of noon said: “Any plans to launch online auction will be announced when finalised. We can confirm that we are investing in high-end technology to add a number of new functionalities on our platform.”For all the latest retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.