An e-commerce arms race is heating up in one of the Middle East\u2019s most lucrative markets, with United Arab Emirates-based property holding company Emaar bidding against Amazon for e-commerce retailer Souq.com. Emaar, which owns properties including the sprawling Dubai Mall, announced that it was offering US$880-million for the Middle East\u2019s biggest online retailer.
\nEmaar Malls PJSC\u2019s bid for Dubai-based Souq.com was made public today, in a filing on the Dubai Financial Market. The document said the decision was made \u201cin line with the strategy to align e-commerce with physical shopping.\u201d
\nEmaar\u2019s offer outbids Amazon\u2019s alleged offer by some $230 million.
\nWhile news of a potential Amazon acquisition goes back months, an announcement by another local conglomerate, Alabbar, that it would launch its own online retail site, noon.com, seems to have lit a fire under the market. Backed by Saudi money, Alabbar\u2019s investment in noon.com is reportedly $1 billion, with one source telling arabianbusiness.com that, \u201cnothing is being left to chance\u201d.
\nIf Amazon Prime\u2019s fast service is a tantalizing offer, local media have reported that noon.com will offer three-hour, door-to-door delivery on items, as well as \u201cground-breaking\u201d return policies and advanced payment platforms.
\nThese developments set the stage for a major e-commerce battle in Gulf markets, where e-commerce sales are expected to reach $70 billion within a decade.
\nDespite its promise, e-commerce penetration in the Gulf region is surprisingly low given the local population\u2019s spending habits. Dubai residents still pack themselves into local shopping malls, much like Americans did during the late 1990s, suggesting that e-commerce disruption is right around the corner.
\nBut while e-commerce could take a bite out of the region\u2019s brick-and-mortar stores, malls command a unique centrality to local socio-economic life, given the lack of alternatives for mingling. This is especially the case in more conservative parts of the Gulf.
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\nSource: aircargoworld<\/p>\n","protected":false},"excerpt":{"rendered":"
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