Even before the onset of the pandemic, e-commerce (goods) retail constant value sales (2021 prices) had been expanding rapidly in Saudi Arabia – almost doubling between 2017 and 2019, for example. The strong growth seen in 2020 was thus not exceptional in the broader context of the review period.
Consumer electronics is the leading category in e-commerce in terms of retail value sales, followed by apparel and footwear, with these two categories accounting for close to half of e-commerce retail value sales in 2021. Having more than doubled in 2020, food and drink e-commerce was the best performing category in e-commerce during 2021.
E-commerce in Saudi Arabia continues to shift towards domestic players: During 2021, foreign e-commerce constant value sales declined for the first time ever, while those of domestic e-commerce continues to increase. This reflects the maturation of the local e-commerce ecosystem, particularly since Amazon.
E-commerce will begin to mature during the forecast period, with the rate of growth in retail constant value sales (2021 prices) set to slow to single figures. Chains like Carrefour will increasingly pivot towards an omnichannel model that embraces both physical stores and e-commerce.
Food and drink e-commerce is set to remain the most dynamic sector in e-commerce during the forecast period, as it is relatively immature and thus has a lot of room for growth. Quick-commerce (q-commerce) is set to see strong growth in Saudi Arabia during the forecast period.
Buy now pay later is set to emerge as a commonplace payment option in e-commerce during the forecast period, with a number of players like Namshi already offering this service. With the rate of inflation set to spike during the early part of the forecast period, this will help to make big-ticket items more affordable to local consumers (particularly those on lower incomes).
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Sales of consumer goods to the general public via the Internet. Please note that this includes sales through mobile phones and tablets (i.e. m-commerce). E-commerce includes sales generated through pure e-commerce websites and through sites operated by store-based retailers. Sales data is attributed to the country where the consumer is based, rather than where the retailer is based. The definition of e-commerce is agnostic as to where actual payment takes place; if an order is initiated online, it is considered to be an e-commerce transaction, even if the order is ultimately paid for in-store (or elsewhere). As a result, all ‘click-and-collect’ and ‘collect-at-store’ transactions are counted as e-commerce sales. E-commerce excludes sales of: (a) Consumer-to-consumer (C2C) and business-to-business (B2B) sales, although please note that sales between businesses and consumers (i.e. B2C sales) on sites such as eBay are included; (b) Sales of motor vehicles, motorcycles and vehicle parts; (c) Tickets for events (sports, music concerts, etc.) and travel; (d) Sales of travel and holiday packages; (e) Revenue generated by online gambling sites; (f) Returned products/unpaid invoices; and (h) Internet sales from direct selling companies, as these are tracked in Direct Selling market size/shares. Example e-commerce brands include Amazon.com, Zappos.com, Apple.com, iTunes, Rakuten, Tesco.com, Dell.com, Coles Online, etc. 3rd Party Merchant sales through online marketplaces, such as Amazon.com, eBay.com and Walmart.com, are included and split out in shares. 3rd party merchants are the summation of sales that come from businesses that are present on an online marketplace (e.g. Amazon, Alibaba). Marketplaces are websites that allow multiple merchants to sell on the marketplace website, with the marketplace operator processing the transactions, but many marketplaces provide offer other services as to help with shipping, handling, payment, and product storage. The marketplace is not the merchant of record legally, but for the sake of shares, sales from 3rd part merchants are attributed to the marketplace brand operator.See All of Our Definitions
This report originates from Passport, our E-Commerce (Goods) research and analysis database.
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