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Beyond the Digital Divide:  Evolving Digital Commerce in the Kingdom of Saudi Arabia in 2014

Capture11Sacha Orloff Group Report

Beyond the Digital Divide:  Evolving Digital Commerce in the Kingdom of Saudi Arabia in 2014

Author: Alexandra de Kerros Boudkov Orlov – CEO Sacha Orloff Group

Website: www.sachaorloff.com 

 

In the Gulf, and in Saudi Arabia, the trend is an expansionist real estate strategy.  Leading groups prefer to cash-in with proven formulas, highly praised in the Middle East, such as malls and western franchises, even if mother-brands operate online and offline.

The Kingdom has largely accepted the principle of the evolution of the shopping Malls, and has adopted by default e-commerce solutions and payments to acquire a large part of the consumer goods and products market, encompassing the full value chain from banking system, retail, airline, hospitality, tourism, transport couriers and telecommunication sectors.  Most of these companies are changing their product mix to support margins, focusing on increasing sales, and consolidate customer loyalty to grow sales and introducing co-branded credit cards.

The Millennial Generation represents one of the most important factors in the adoption of e- and m-commerce in the region. This year, Internet penetration in the Kingdom reached 59.25 percent of the population, and has grown by 11 percent since 2013

Now is the time for the Saudi merchants and business groups to be fully immersed in digital activities. As most of the Saudi firms are still not embracing e- or  m-commerce; they should tap into the market of mobile owners to drive traffic, increase loyalty and grow sales.

To link technology, innovation and strategy to the Saudi digital sector require acquisition and retention of human talents.  Leadership, creativity, expertise, development and execution are key factors to growing success and excellence. It allies company culture to create strong relationship between human forces and firms.

In all the GCC, customer service is weak and investing in training human capital is essential to obtain a level of satisfaction to retain customers. The danger to accept mediocrity is that firms compete with others on the same average level.

The actual organizational moto is to move away from channel focus to customer focus. The business implies data analytics, supply chain optimization, integrated technology and strong customer service. Businesses have to take calculated risks, embrace disruptive changes and empower their talent forces to gain both offline and online customers.

Download the reporthttp://media.wix.com/ugd/17fd63_f7f73aaa041b46fc8de638b8544402ab.pdf

 

Sacha Orloff Group in the Media:

Saudi Gazette:
http://www.saudigazette.com.sa/index.cfm?method=home.regcon&contentid=20140714211489

Trade Arabia
http://www.tradearabia.com/news/IT_261912.html

Technology Market Corporation
http://technews.tmcnet.com/news/2014/07/14/7921871.htm

 

Ministry of Economy Taiwan – Bureau of Foreign Trade
http://www.trade.gov.tw/Pages/Detail.aspx?nodeid=45&pid=480034

Topix http://www.topix.com/world/saudi-arabia/2014/07/saudi-firms-urged-to-bridge-the-digital-divide-tradearabia

The Paypers
http://www.thepaypers.com/e-commerce/saudi-arabia-millenials-are-the-most-important-factor-in-ecommerce-adoption/755814-25

Taiwan Trade
http://www.taiwantrade.com.tw/CH/bizsearchdetail/7553024/C

Retail and Loyalty
http://www.retail-loyalty.org/en/news/saudi-arabia-millenials-are-the-most-important-factor-in-ecommerce-adoption/

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Saudi Arabia – Largest retail market in the Gulf

 

The GCC retail industry is poised for a healthy growth. “The retail industry has been one of the fastest growing sectors in the Middle East for the last few years. It is the second largest sector in the oil-rich GCC region, and is considered to be the most preferred means of promoting diversification and sustained economic development in the region”, said Sameena Ahmad, Managing Director of Alpen Capital.

 
The forecast retail sales in the GCC to grow at a CAGR of 8.3 percent between 2010-2015, reaching $240.3 billion by the end of the forecast period. Growing per capita GDP and disposable income, expanding population base and consistent inflow of tourists will boost the region’s retail sector going forward. Retail sales of supermarkets and hypermarkets in the GCC are estimated to expand at a CAGR of 10.7 percent between 2010 and 2015, thus outpacing the broader retail industry.

 
Given a larger size of the population base, Saudi Arabia will continue to account for the largest slice of the GCC retail industry.
Based on projections, Saudi Arabia is forecast to grow at a CAGR of 9.4 percent and increase its share in the total GCC retail sales from approximately 42 percent in 2010 to 44 percent by 2015. UAE and Qatar are expected to show a robust growth at 7.9 percent and 7.7 percent respectively CAGR between 2010-2015.

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China confirmed as world’s second largest economy

 

By Phillip Inman 

China‘s role as the engine of world trade and chief rival to the US was cemented yesterday after its economic performance in 2010 powered it to second place in the global rankings ahead of Japan.

The Chinese economy grew by 10.3% last year, in sharp contrast to Japan, which has struggled to grow by more than 2% a year for the last two decades.

The stronger than expected data from China sent stock markets and the price of commodities falling as traders wrestled with the implications for growth and inflation in the rest of the world.

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