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The latest and most complete Middle East e-commerce platform market report!

Date: 2018-08-28
BrowsingS: 160
Release date: 2018-08-28
BrowsingS: 160

Friends who are engaged in cross-border e-commerce in emerging markets must know that the Middle East is a potential market that cannot be ignored. Especially in recent years, the rapid growth of China's e-commerce platform in the Middle East has strengthened the confidence of e-commerce practitioners. It is estimated that in the next five years, the growth of e-commerce in the Middle East will reach 25%-30%, and the value of the UAE and Saudi E-commerce industry will triple which is expected to reach US$15 billion by 2020.


CommerCity, the e-commerce free zone, is also launching a major initiative to promote regional e-commerce development. The 2.7 billion UAE dirham (about 4.8 billion yuan) free zone aims to attract foreign companies and cultivate young UAE businesses’s entrepreneurship.while the state-of-the-art warehouse will also help the company to ship goods to the local market faster.



On the whole, the Middle East e-commerce platform mainly includes the Middle East local platform represented by Noon and Wadi, the European and American employer platform represented by souq and namshi, and the Chinese e-commerce platform such as Jollychic, Fordeal and Shein. Souq was acquired by Amazon and was established for the longest time. Noon was only launched in 2017, but it has a strong behind and invested $1 billion. Today,CITITRANS specially collected data from all parties and took a comprehensive look at the past and present of each e-commerce platform.

Souq-Amazon's Middle East map

The Souq homepage is Currently, Souq has four sites throughout the Gulf, which namely Dubai Station (Headquarters), Saudi Station, Egypt Station, and Kuwait Station. Because the Middle East is a politically and financially sensitive area, the Souq sites are separated and cannot be used by a similar number.


1. The establishment of Souq

Souq was founded in 2006 by Ronaldo Mouchawar, a native of the Middle East. Due to the weak deployment of Amazon and eBay in the Middle East, Souq just filled this gap. And because the background at the time encountered difficulties in expanding business in many Arab countries, chose Dubai with a good business climate as its headquarters.




The initial nature of Souq was in the form of an auction website. The framework、 content and services provided by the website also conformed to the habitual characteristics of the Middle Eastern people. The interface color was relatively simple, the content was relatively rigid, and the operation was relatively simple which are In line with the characteristics of the Middle East local tyrants. At the beginning of the company's establishment, the Internet penetration rate in the Middle East was 20%. In the following years, thousands of people used mobile phones and  internet, and's business also took off.


2. the growth of souq

In March 2014, South African media giant Naspers (Tencent's largest shareholder multinational media group) invested S$500 million in, and founded the promotional festival “White Friday” in the same year. Other strategic investments include: Tiger Global, Standard Chartered Private Equity, IFC (one of the World Bank's affiliates), and Baillie Gifford (Baidu's second largest shareholder). In February 2016, it received a $275 million investment from the New York Tiger Global Fund and South Africa's Naspers to strengthen technology development and expand its product line. In March 2017, Amazon acquired Souq for $650 million.


3. The rise of Souq

The real rise of Souq was after the acquisition by Amazon on March 17, 2017. Amazon has retained the independent operation of the Souq brand. Merchants do not have to worry about the ip restrictions like the Amazon platform when operating the Souq backend. At the end of 2017, Amazon opened an Amazon store on Souq. The location of the Souq logo was also marked with the English characters of the Amazon subsidiary. At the same time, the buyers of Souq also connected to the Facebook and Amazon member data. The Souq platform traffic has soared. Currently, the monthly fixed traffic is more than 45 million. The number of user visits is increasing at 30% every year, and it is expected to reach 130 million visits in the next three years.


Also in September 2017, Amazon and Souq acquired the logistics service platform to help them stay ahead of Amazon's traditional superior logistics.'s fast delivery service can also help Amazon expand its Prime business to the Middle East.



Souq has developed rapidly in recent years and has established its own logistics system QExpress and payment system PayFort. Moreover, Souq also launched its own brand of tablets, and plans to launch more private brands of its own products. In order to build its own e-commerce culture, has achieved good results in the launch of the White Friday promotion in the Middle East.


4, Souq's business scope

Like most online retail platforms, Souq is also open to third-party sellers and merchants in the UAE, Egypt, Saudi Arabia and Kuwait. Souq currently has more than 8.4 million items in more than 31 categories, covering electronics, clothing, household items, watches and perfumes.


5, Souq's entry conditions

  a. Local business license application account; (Middle East ID, phone number, tax number, etc.)

  b. Local warehousing (since Souq has its own logistics system)

  c. The security card and the local bank account are required for collection (only local bank cards).

  d. Need the seller to provide the shipping address, Souq courier pick up the goods to the Souq warehouse unified delivery

Since Souq is not open to other countries outside the Middle East, Chinese merchants are unable to settle on their own and need to use third-party channels to enter Souq .


At present, CITITRANS investment agency right. We will provide a large number of high-quality Chinese sellers with comprehensive services such as opening sales channels, full-chain logistics and distribution, customer service and returning to the second place for re-sales,who can Empower engines for Chinese export companies.



At present, Souq mainly adopts two methods, namely FBS (Souq official warehousing distribution system) and self-delivery mode.


FBS mode delivery is relatively fast, but the cost of backlog of goods is relatively large, that is, every product uploaded must be shipped to the FBS warehouse. In the second half of 2017, Souq announced the collection of storage fees, but there is no large area of charge so far , and this Mode is relatively safe in terms of cargo properties;


The overseas warehouse is relatively flexible. At present, most overseas warehouses and Souq maintain a good relationship, and the warehouses are mostly close to Souq. Merchants can exchange sku and support each other to grow together. This model requires merchants to choose trust. Overseas warehouse cooperation, try to avoid losses in products and funds.


Namshi noon-Albar's investment map

Noon is a Middle East local e-commerce platform invested by Emaar Real Estate and Saudi Sovereign Fund. The officially started operations in September 2017. There are currently two sites in the UAE and Saudi Arabia. It will cover the entire Middle East and North Africa in the next 5 years. Regional online market.



Emaar is one of the largest real estate developers in the Middle East. Its real estate is Burj Dubai-the world's tallest building, and Dubai Mall-the world's largest shopping mall. Its founder, Mohammed Alabbar, is the chief adviser to Sheikh Mohammad bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates.




The Public Investment Fund (PIF) is a sovereign wealth fund owned by Saudi Arabia that is designed to represent the Saudi Arabian government. PIF's portfolio has approximately 200 investments, of which approximately 20 are listed on the Saudi Stock Exchange Tadawul.


Noon's strategic layout


Mohammed Alabbar:the Founder of Emaar Real Estate and Noon , one of the most influential businessmen in the Middle East, who joined forces with successful GCC Gulf countries to raise $500 million to inject noon;

PIF: the investors of in Saudi , in cooperation with Softbank in 2016, established the London-based Softbank Vison Fund, which aims to invest $45 billion in the technology industry within five years;

MEVP: Holding the Middle East Venture Capital Fund MEVP in May 2017, this acquisition is part of Alabbar's active expansion of e-commerce and digital;


Platform: E-commerce platform with 8 years of B2C experience in the Middle East, acquired by Mohammed Alabbar in 2017; E-commerce platform with 7 years experience in Middle East Fashion, Mohammed Alabbar acquired 51% of its shares in 2017; The local Fashion e-commerce platform, a sister company of noon; Alabbar owns 4% of the online fashion retailer Yoox Net-a-Porter Group and invested $113 million in the company in April 2016;

eBbay: In June 2018, Noon announced a strategic partnership with eBay.



Aremex: Alabbar acquired Aremex 16.45 shares in the Middle East as the largest logistics company in 2016;

Noon express: Noon has a self-built logistics team in Dubai and Saudi Arabia to deliver the last mile, the fastest aging day.

Noon FNB: Currently, they have own logistics warehouses in Dubai/Yardeli/Jeddah, and more warehouses are being expanded.


At present, Noon has an office in Shenzhen, China, and actively invites Chinese sellers to recruit goods, including fashion, home, electronics, maternal and child, and beauty. The cooperation mode is SB2B and (seller's own delivery) and FBN (Dubai, Riyadh, Jeddah overseas warehouse).


Wadi - Middle East Internet Group was founded in 2015 and is part of the Middle East Internet Group (MEIG). MEIG is a joint venture between the German incubator RocketInternet and the South African telecom operator MTN. It has many home appliances in the Middle East and Wadi is one of the fastest growing.



It is rumored that eBay is negotiating to acquire Wadi, the Middle East e-commerce is Forming a tripod.


In 2016, Wadi received $67 million in Series A financing, led by Al Tayyar Travel Group, headquartered in Saudi Arabia.


After gaining investment from the agency, Wadi changed its strategy and shifted its focus from the UAE to Saudi Arabia ,to start building its own logistics system in Saudi Arabia.


Wadi's founder said in an interview in October 2017, “We are facing some challenges in Saudi Arabia, such as customs procedures and the country's seriously backward address system. We are working with the Saudi government to develop geography and mapping technology to overcome these challenges.'



The fast-growing Wadi has attracted the attention of investors. There were rumors that eBay is negotiating with Wadi about the acquisition. According to the consistent style of Wadi's early investor RocketInternet, this rumor may become a reality in 2018.


Middle East local vertical e-commerce

The Luxury Closet (Second-hand luxury e-commerce)

TheLuxuryCloset (hereinafter referred to as TLC) is a well-known startup in the Middle East. It is an e-commerce platform for second-hand luxury goods transactions. The company was founded in 2012 and is headquartered in Dubai. Its business includes the acquisition, sale and consignment of personal luxury goods. Most of its merchandise is second-hand and is sold at a discounted price.


TLC’s founder Kunal Kapoor is a former LV sales executive with nearly 30 employees in three countries: the UAE, India and Saudi Arabia. At present, the average order value of the website is 600 USD, and more than 33% of customers will repeat the purchase within 12 months.



Kunal Kapoor


Unlike traditional C2C e-commerce, sellers need to take a special process because of the particularity of the goods. Firstly, the seller must take the goods to the TLC staff, negotiate a target price, then send the goods to the TLC warehouse, and then TLC professional staff take care of the goods, take pictures.After the transaction is successful, TLC will charge a certain percentage Commission which is included in the sales price.That’ mean the price paid by the buyer is the price + commission received by the seller.




Detailed commission instructions are available for the TLC website. The higher the value of the item, the lower the commission rate charged.


For the buyer, every second-hand item that the buyer sees is verified by TLC and rated according to the condition of the product, such as new, slightly lossy. Buyers can also pay with Payfort installments.


TLC has obtained several rounds of financing so far , including MEVP, WamdaCapital and so on.


Mumzworld (mother and baby e-commerce)

Founded in 2011, Mumzworld is a maternal and child e-commerce company that focuses on newborns to 12-year-olds. In terms of volume, Mumzworld is the largest maternal and child e-commerce company in the entire Arab region.


Mona Ataya, the founder of Mumzworld, is a famous female entrepreneur in the Middle East. In 2001, she co-founded her job search site( her brother Rabea Ataya.




In Dubai, people's shopping channels are mainly Mall (large shopping malls), and it is very difficult to move people from Mall to online. However, Mona's positioning of Mumzworld is not just e-commerce. From the first day of the website, there are comments and community functions to help mothers make the right decisions and share parenting experience.


Mumzworld's current business is mainly for the six countries of the Gulf, the United Arab Emirates and Saudi Arabia have the largest market share.

In February 2016, Mumzworld completed a multi-million dollar Series B round of financing, investors include Wamda Capital, Twofour54, Endeavour Catalyst and others.


AWOK (flash purchase e-commerce)

AWOK was established in April 2013, and the model is similar to the poly cost-effective, mainly selling discounted daily necessities.

AWOK’s founder-Ulugbek Yuldashev is a Kyrgyz person who had a wholesale and retail company in Kyrgyzstan before coming to Dubai. It is worth mentioning that AWOK has been operating its own funds since its inception and has not received external investment.




AWOK has a purchasing team in China, and 80% of the products on the website are from China. This is also the 'secret' of their low-priced goods. In order to solve the last mile delivery problem, AWOK built its own logistics team, from the initial two cars to nearly 200 cars now.


Joi (gift e-commerce) was founded in late 2015 and the website was officially launched in April 2016. Its goods are very special and are a variety of gifts. Joi's co-founder Alpecelan is a serial entrepreneur and an investor. Prior to founding Joi, he had successfully invested and founded a number of companies.




Joi does not produce products such as bouquets and cakes. It cooperates with merchants so that the model is lighter and there is no inventory pressure.


Jollychic markavzp - China's Middle East map

The e-commerce platform Jollychic has become the first in Saudi Arabia and the most influential fashion e-commerce platform in the Middle East.The executive turnover has grown from 100 million in 2014 to 5 billion in 2017, and the daily volume Once reached 50,000 when in the white Friday season last is considered a dark horse of the Middle East e-commerce. Unlike Souq and Noon, the local e-commerce providers in the Middle East, Jollychic started its own way, relying on China's powerful supply chain resources to sell inexpensive goods to Saudi second- and third-tier city shoppers through online channels.



At present, Jollychic has begun to transform into an open platform, gradually expanding its warehouse in Saudi Arabia, and has built the largest overseas warehouse in the Middle East.

Acquisition of the Middle East local e-commerce platform MarkaVIP



At the end of 2017, the company acquired a low-key acquisition of the Middle East e-commerce website-MarkaVIP. The company was founded in November 2010 and is headquartered in Jordan. In 2012, MarkaVIP received $10 million in financing, and after the acquisition, MarkaVIP still retains independent brand operations.




AliExpress - Alibaba AliExpress online trading platform

AliExpress Shopping, Chinese name is sumaitong. Officially launched in April 2010, it is the only B2C online trading platform created by Alibaba for the global market. It is called“International Edition Taobao” by the majority of sellers. AliExpress is open to overseas buyers who secured transactions through Alipay International accounts and used international express delivery.




Globalegrow E-commerce

Zaful, RoseGal are Chinese company: Shenzhen Globalegrow E-commerce Co., Ltd.


Founded in 2007, Globalegrow E-commerce has been listed in the 2014 round of the round pants industry (renamed cross-border communication from June 12, 2015) (A share code 002640), headquartered in Nanshan District, Shenzhen. now There are more than 1,000 employees. Globalegrow E-commerce focuses on cross-border export-oriented retail e-commerce platform business, and has a world-renowned cross-border B2C sales websites.





In terms of sales, traffic and expansion speed, Globalegrow E-commerce is the domestic leader in cross-border e-commerce. Its growth rate is staggering. According to official data, Globalegrow E-commerce has maintained a growth rate of more than 100% for many years: sales of 7.98 million in 2011, sales of 198 million in 2012, and sales of 466 million in 2013, 2014 Annual sales are 1.47 billion.



SheIn and RomWe is Founded in 2008 by Shenzhen City Library Technology Co., Ltd. . Shein is positioned as a “cross-border fast fashion enterprise”, independently designing, producing and selling its own brands. The main markets are in Europe and America. According to Shein's public information, its ranking among mobile e-commerce companies in the United States (the comprehensive ranking of shopping apps in the app store) is secondly to wish and AliExpress, while mobile e-commerce rankings in the major European countries are in the top five ,higher  than Wish, H&M and ZARA.




Romwe was originally a very similar competitor to SheIn.It was established in Nanjing in December 2009. In May 2016, Shein completed the B round of financing, IDG and Jinlin led the investment of 200 million, and then, Romwe was acquired by SheIn.



Fordeal is a global practitioner of China's manufacturing upgrades, Chinese design and Chinese brand culture. It is founded by a group of well-known domestic e-commerce platform elites. The platform operates a wide range of goods, covering many countries and regions around the world. Sales outlets cover the Middle East, Europe and the United States and many other countries and regions, including the most important market in the Middle East market.




On March 6, Chongfeng Evergreen (K2VC) completed its investment in Fordeal. In addition to fancy its size and growth rate, the Fordeal has three genes:


Firstly, the core members of the Fordeal team came from the 'Ali Department',who is the earliest pioneer of e-commerce and the experience and witness of China's e-commerce development. The team has extensive e-commerce experience in technology, promotion and supply chain management.


Secondly, the Fordeal team perfectly integrates the overseas localization genes, which gives him an absolute advantage in localization operations. At present, the team has an operation center overseas, and through the operation of goods and content by local people, the platform has significantly higher consumption conversion rate than other platforms.


Thirdly, thanks to the e-commerce experience of the project several years ago, the Fordeal team has accumulated rich resources in terms of personnel, suppliers and capital. These original resources are important factors for the rapid growth of Fordeal in the early stage and the cornerstone of long-term development in the future.


Then, as a new foreign trade development mode for cross-border e-commerce, there is no traditional foreign trade enterprise that has undergone transformation and upgrading. How do you keep up with the trend of the times and jump on the express train of cross-border e-commerce? Based on an in-depth understanding of the Middle East market,CITITRANS summed up eight experiences and shared them with the transformation sellers.


First, open up the logistics distribution channels, win with timeliness and service


At present, the terminal distribution in the Middle East is mainly provided by several large express delivery companies. In the COD countries, the tail delivery service is equivalent to the most important part of the entire sales process.

The E-commerce parts signing rate in the Middle East is only 80%. 20% of the returns are the key point that directly affecting the profitability of e-commerce sellers. There are still many service problems in distribution in the Middle East. The core is still due to the underlying structure of these courier companies: The customer service personnel feedback is not timely, the customer service link is insufficient, the management is chaotic, and the actual needs of the e-commerce enterprise cannot be met. Ordinary express delivery companies are fast-moving and radiant, and many regions are franchise systems. Management cannot reach the peripheral nerves.The signing rate will go down if the requirement is only the time limit.The service can not keep up which leds to a low signification. The current Middle East logistics is a market full of challenges and business opportunities. The distribution data accumulated by the terminal logistics directly comes from the huge commercial value of the consumers, and it is very important for the previous market to predict the improvement of customer satisfaction and supply chain management optimization.


Second, the selection: the product is king

“Products are core competitiveness”. In the selection process, sellers need to consider the following factors:

• Market capacity: The seller needs to sort out the annual sales of the target.

• Competitive situation: considering the brand concentration and the strength of the top five sellers, combined with our own comprehensive strength to assess what we are ranked

• Real profit of the product: deducting the head-end fee, long-term and short-term storage fee, FBA shipping fee, return and exchange cost, and cargo damage cost etc..


Third, the team and KSA analysis

There is a saying that 'the soldiers who don't want to be generals are not good soldiers.' No matter who is responsible for the role of the person in charge, they can be analyzed from the KSA model. K-knowledge, S-skill, A-attitude, the team should use A as a premise to improve the ability of K and S.

Fourth, operations

Optimizing product graphics, post-sale evaluation marketing, tabulation to observe the data fluctuations of this product and competing products, verifying the selection data, entering the product classification are all basic operational steps.


Fifth,flexible supply chain and traditional bulk orders

• Early stage: The flexible supply chain is a breakthrough and a breach; it is necessary to maintain an in-depth cooperation with suppliers and determine strategic cooperation and even shareholdings.

• Late: Traditional product bulk orders and shipping shipments, creating barriers to competition; achieving the same competitive starting line as the cost of US sellers' products.


Sixth,Compensation methods and team incentives

“Profit is tied to profit rather than sales.” Let the focus of operations shift from sales to all factors tied to profit.


Seventh,financial management of fine management

• Calculate the real profit of each listing, input-output ratio

• Profit analysis from individual to team, from item to category, from single station to multi-station, input-output ratio

• Analysis and warning of inventory data through five levels: explosion, hot sale, flat payment, slow sales, and clearance

• Pre-judgment of cash flow, guiding and supervising operations from a financial perspective

Eighth: grasp market opportunities

“there is an opportunity every four years if you are Deep farming in an industry. ”, and whether the opportunity can be seized is a very crucial turning point for the seller. In addition, B2C itself has a fast-paced, unconstrained character for market opportunities, and therefore has an innate advantage in the selection. Finally, a good store should have a steady and sustained sales and opportunities for the market to meet the market's consumption upgrades.

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