Cross-border online shopping on the rise in UAE, report shows

61 percent of UAE online shoppers bought items from a foreign website in the last 12 months, according to a new report by PayPal and Ipsos
Cross-border online shopping on the rise in UAE, report shows
By Bernd Debusmann Jr
Thu 30 Aug 2018 10:54 AM

Online spending continues to grow in the UAE and is expected to reach AED 36 billion ($9.8 billion) at the end of 2018, according to a new report by PayPal and Ipsos.

In the fourth annual ‘Cross-border Commerce report’ – which examined the domestic and international online habits of 34,000 people in 31 countries – PayPal found that 81 percent of UAE adults shopped online in the last year, up from 68 percent in 2016.

The report also found that 61 percent of UAE online shoppers bought items from websites in another country in the last 12 months, 33 percent more than the previous year. Additionally, 12 percent of online shoppers stated that they shop exclusively on online shops and marketplaces outside the UAE.

Cross-border shopping has grown by an estimated AED 1.6 billion ($435.6 million) since 2016, accounting for an estimated AED 12.5 billion ($3.4 billion) of all online spend in 2017.

“The UAE’s commerce revolution is well underway and, backed by the country’s diverse and truly global population plus improving logistics services, consumers are increasingly looking internationally to source their favourite products and services,” said Efi Dahan, general manager, Eastern Europe, Middle East and Africa at PayPal.

“In today’s global society, consumer spending behaviour is increasingly being dictated by convenience and value,” he added. “Our findings showcase this, with just over half of the online shoppers surveyed stating that it was not important to them if the retailer was based overseas.”

Mobile spend is forecast to grow 26 percent between 2018 and 2019, and is expected to reach AED 20 billion ($5.45 billion), with a further 25 percent growth by 2020.

In the UAE, 49 percent of cross-border purchases were made on mobile devices, while 84 percent of shoppers had made at least one purchase using a mobile device.

“With some of the highest levels of smartphone penetration globally, it is unsurprising that the smartphone is the device of choice for online shopping in the UAE,” Dahan said.

Clothing, footwear and apparel were the most common cross-border purchase category in the UAE, with 64 percent of cross-border shoppers having bought from this category, compared to beauty products and cosmetics (49 percent), toys and hobbies (40 percent) and health products (36 percent).

The United States was found to be the most popular cross-border shopping destination, with 22 percent of local online shoppers making a purchase from an American website in the last 12 months. Trailing behind the USA were India (16 percent) and China (15 percent).

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