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Aramex e-commerce survey: Why are people not selling online?

  

Globally, e-commerce is forming a larger and larger complementary sales channel of traditional retail trade, with around 7 per cent of all retail volume in the US occurring online. Emerging markets such as China, meanwhile, are now realizing the potential of online purchasing and order processing in a vast country of 1.4 billion inhabitants – and some 200 million people are already estimated to be regular users of e-commerce services.

The Middle East, though, is still behind. Although online purchasing is on the rise, most notably in clusters in the GCC countries, where transactions online expanded by 15 per cent in 2010 and total $100 billion in sales (ICDL GCC Foundation), other countries in the region – Jordan, Lebanon, Egypt – are still working to exploit these new opportunities. Indeed, across all countries in the MENA region a majority of businesses are still not making their products available for purchase online. Seeing how e-commerce brings costs down and expands the customer base of businesses, why are some organizations in the Middle East still not making the plunge?

In July 2011, Aramex conducted a survey* to find out why there was a resistance to offer e-commerce services, even though enabling e-commerce for any business is usually a relatively simple strategy that could potentially open up new markets and target new customers. The survey provided insights into the reasons that some people are not migrating their traditional businesses to an online space. *

Aramex targeted decision makers from Saudi Arabia, the United Arab Emirates, Jordan, Lebanon and Egypt to understand their attitude about e-commerce. The percentages that responded from each country and their respective industries were:

 

KSA

Jordan

UAE

Lebanon

Egypt

36 %

29 %

26 %

6 %

3 %

 

 

Industry

Percentage

Electronics

38 %

Accessories & Apparel

18 %

Cosmetics & Perfumery

9 %

Fashion

5 %

Furniture & Fixtures

5 %

Software

4 %

Textiles

4 %

Engineering

3 %

Professional Services

3 %

Others (Building Material, Toys, etc)

12 %

 

Results

Question 1: Respondents were asked Are you Currently selling Online? and the following responses were gathered:

No; I am not selling Online

I am working on it

Yes, I am currently selling online

85%

9%

6%

 

Question 2: For respondents who said “No”,  they were asked “What are the main reason(s) that prevents you from selling online?”, the following responses were gathered:

 

 Rank

Response

%

1

My business needs direct contact with my customers

30%

2

I am a distributor / I am selling to businesses

14%

3

I do not need  e-commerce, I have my branches

12%

4

I never thought about it

8%

5

It needs technology and efforts / It is expensive

7%

6

My products need after sales service/installation

7%

7

My business cannot be online

5%

8

My head office needs to make such decisions

5%

9

My customers do not trust online payments

4%

10

Others (Fear of design theft, do not want to declare prices, small business, etc)

8%

 

Question 3: For respondents who said “No” (i.e. not selling online), they were asked “Are you considering moving into e-commerce?”,  the following responses were gathered:

 

No

Yes

88%

12%

 

Question 4: For respondents who said “Yes”,  they were asked “What are the main challenges you are currently facing in selling online?”,  the following responses were gathered: 

 

1.       I am not facing any challenges

2.       I want to see more customers adopting online payment

3.       I want speedy / door step deliveries

 

   Read about our analysis and conclusion of the results

* This survey is by no means meant to be an exhaustive, representative sample of all opinions. It is merely an ancedotal reflection of some of the perceptions and point of views of e-commerce in the region.

 

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