Mining the hot land of the Middle East, SaleSmartly participated in the release of the 2023 Middle East Cross-border E-commerce White Paper!

The Middle East's cross-border e-commerce market, with its increasingly young population and growing spending power, is showing unprecedented activity and prosperity, providing broad market opportunities for global companies going overseas.
On May 30, in order to better help merchants seize this emerging market, Shoplazza, in collaboration with Baidu International MediaGo, Dealfy, Mabang Technology, Payssion and SaleSmartly , conducted in-depth insights and analysis on the Middle East cross-border e-commerce market and massive data, and officially released the "New Driving Force for Independent Station Growth - 2023 Middle East Cross-border E-commerce White Paper" (hereinafter referred to as the "White Paper").

This white paper focuses on the Middle East cross-border e-commerce market, deeply analyzes the current market situation, looks forward to future development trends, and provides insights into the opportunities for going overseas in the Middle East. It also proposes a set of comprehensive solutions to address the challenges and problems encountered by merchants in market development, helping Chinese merchants to succeed in the Middle East cross-border e-commerce market. (Get the full report for free at the end of the article)

The cross-border e-commerce market in the Middle East is growing rapidly, and the International Trade Administration predicts that its market value will be close to US$70 billion by 2023. This development momentum is mainly driven by three key factors: a young population structure, high Internet penetration, and government policy support .

According to World Bank data, the total population of the Middle East has reached 454 million, more than half of whom are the main consumer groups of cross-border e-commerce and mobile e-commerce. On this basis, the Internet penetration rate of nearly 100% provides a broad market space for cross-border e-commerce.

In addition, as a hub for the implementation of my country's "Belt and Road" initiative, the Middle East has brought more opportunities for cross-border merchants. As of January 2020, China has signed cooperation documents on the joint construction of the "Belt and Road" with all Middle Eastern countries.

With a younger population, higher internet penetration and supportive government policies, consumers in the Middle East are increasingly inclined to shop online, and cross-border e-commerce provides consumers with broader and more diversified shopping options.

At present, the Middle East e-commerce market already has several major players such as Souq (now Amazon Middle East), Noon, and Namshi, but for Chinese merchants, the entry threshold is high, and entering the Middle East market on their own faces certain difficulties. Independent sites, which are more flexible in operation and more conducive to accumulating private domain traffic, have gradually become a new choice for Chinese merchants to tap into the Middle East market.

Easy and fast: open your own store and enter the market quickly

Through independent websites, Chinese merchants can open stores independently, use templates to build websites, and quickly enter the Middle East market without high threshold qualification requirements.

Flexible operation: low-cost operation and free development

Independent sites provide merchants with flexible operating space, allowing them to customize personalized business strategies and marketing methods, reduce operating costs, quickly adapt to market changes, and achieve free development.

Sedimentation of private domain: Building stable assets and achieving repeat purchases

Independent sites allow merchants to communicate directly with customers before, during and after sales, provide personalized services and customized membership systems, thereby creating stable private domain traffic and increasing repurchase rates and loyalty.

With the advantages of independent sites, such as simplicity, speed, flexible operation and private domain accumulation, both small entrepreneurs and medium-sized and large enterprises can achieve breakthroughs and success in the Middle East cross-border market.

As the population in the Middle East becomes increasingly younger, the usage rate of social media has increased significantly in recent years. Middle Eastern users spend an average of 3.5 hours on social media every day, and each person is active on about 8.4 platforms per month.

MediaGo, Baidu International's global AI integrated marketing platform, maintains in-depth cooperation with Snapchat and TikTok. Based on its rich experience in overseas advertising and marketing, it has created overseas marketing solutions for e-commerce brands that are suitable for various media, which can meet the brand, effect, conversion and other different scenario needs of DTC advertisers.

Snapchat

Snapchat is one of the most popular social apps among millennials and Generation Z in the Middle East, and has a very high penetration rate in the Middle East market. In Saudi Arabia, which has a total population of only 35 million, the number of Snapchat users has exceeded 20 million.

This white paper combines Snapchat with the consumption characteristics of the Middle East market to create a three-step marketing plan for e-commerce brands to meet the needs of advertisers in different scenarios such as brand, effect, and conversion.

TikTok

Among the six Gulf countries, Saudi Arabia and the UAE have the most active TikTok users. According to a study by Statisa and AI technology analysis company HypeAuditor, in 2023, the TikTok penetration rate in these two countries will exceed 100%, and the number of TikTok influencers in the UAE ranks 11th in the world, with an average of 380 videos uploaded per person, which is 46% higher than the global average. The characteristics of TikTok users in the Middle East are fun, sincere and highly receptive to advertising. They pursue value, convenience and shopping experience. Therefore, for this diverse market, cross-border merchants need to have a deep understanding of local culture and implement precise policies.

WhatsApp

WhatsApp has more than 115 million users in the Middle East. In the six Gulf countries, WhatsApp is the most used service under Meta. On WhatsApp, merchants can adopt the public domain traffic + private domain operation model to achieve marketing cost reduction and efficiency improvement.

For example, customers can be directed to the merchant's independent website landing page through social media operations. In addition, WhatsApp Business API mass marketing can reach a large number of customers at a low cost, and with the help of SaleSmartly batch group management and operation, private domain operations can be achieved to increase repeat purchases.

Special features of Middle East orders

Compared with other regions, the Middle East has special and complex orders. The cash on delivery (COD) model is the mainstream logistics model for cross-border e-commerce exports to the Middle East, but it often faces a series of challenges such as unclear addresses, difficult telephone communication, low efficiency of final delivery, and after-sales service problems. This is particularly prominent during the Ramadan promotion. To solve these problems, merchants can introduce order review and order management. It is crucial to pre-review abnormal orders and communicate in real time.

In order to improve management efficiency, save time and labor costs, using ERP for unified management has become a necessary choice for merchants. By integrating cross-border e-commerce platforms and freight forwarding systems, as well as optimizing logistics operating systems, refined, standardized and process-based order management can be achieved to alleviate the difficulties caused by the complexity of Middle East orders.

Cross-border logistics challenges in the Middle East

Cross-border logistics in the Middle East face many challenges, such as logistics timeliness, customs clearance issues, and distribution problems. The timeliness and signing rate under the COD model are closely related, and the timeliness compression and smooth connection of each link are the key. At the same time, the customs clearance regulations of Middle Eastern countries are strict, and the compliance requirements for specific commodities are high. The customs clearance rate is also a major cost for sellers.

On the other hand, last-mile delivery is affected by factors such as geographical environment, cultural and language differences, and the complexity of the COD delivery process, posing challenges to delivery efficiency and customer satisfaction.

Faced with these challenges, independent station merchants can choose different logistics solutions according to the conditions of different regions, and use communication tools such as WhatsApp to establish communication relationships with buyers in advance. After the goods are shipped, they can monitor the logistics status in a timely manner and maintain communication with customers and logistics providers.

With the active promotion of the government and financial regulators, payment habits in the Middle East have gradually shifted from cash on delivery to digital payments. According to a consumer research by McKinsey, 60% of Middle Eastern consumers now prefer digital payments.

According to Payment data, 47% of online transactions in the Middle East are currently conducted through credit cards, and 21% through bank transfers and local card payments. Mainstream online payment methods such as Mada and STC pay are gradually becoming popular.

When merchants prepare online local payment methods, they may face problems such as some payment gateways not supporting local currencies, difficulty in opening multi-currency accounts, and exchange rate fluctuations. Merchants are advised to adopt local payment and US dollar pricing strategies to cope with these challenges.

Therefore, merchants need to adjust their payment strategies in a timely manner. They should retain the option of cash on delivery while also actively introducing local online payment methods to adapt to the changing trends in payment methods.

In the emerging cross-border e-commerce market, the Middle East is gradually emerging with its unique market environment and consumer demand. In order to help Chinese merchants successfully build competitive independent websites, Shoplazza has teamed up with ecological partners to launch the Middle East Independent Website Solution, including independent website construction, Middle East marketing strategy, multi-language and multi-currency support, comprehensive payment methods, efficient and high-quality logistics and warehousing services, etc., and is committed to helping Chinese merchants efficiently meet the full module needs of various industries.

The above content is derived from the "New Driving Force for Independent Station Growth - 2023 Middle East Cross-border E-commerce White Paper" jointly released by Dianjiang Technology and its partners Baidu International MediaGo, Dealfy, Mabang Technology, Payssion and SaleSmartly . We sincerely thank all excellent cross-border partners for providing valuable information and insights into this white paper.

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