Online shopping in the Middle East – Does it work?

When I used to live in Australia, before moving to Bahrain a year ago, I used to run a successful online store, which was my full time job for 2 years (www.splashpack.com.au).  Setting up shop was as easy as creating a product, a brand, setting up your site, and then finally marketing your products both online and offline.

In Australia, and other parts of the world, online shopping is just as effective as traditional shopping.  The reason being is that there are a lot less barriers of entry in this marketplace,  and the infrastructure in the countries really supports it.  The other critical factor is that consumers already have the mindset that it is a lot easier, cheaper and quicker to just buy something online rather than going to the actual store.

What tends to happen as well is that customers will go to a traditional store, to see, touch and feel the product they want to buy.  Once they have made that purchasing decision, they will go online to look for a better deal and price on that same product.

After living in Bahrain for a year, the question that comes to my mind is, does the online shopping model work in the Middle East?

Areas that need improvement for the model to work

1) Consumers need to full adapt to the mindset that shopping online is actually safe, this will surely improve over time, especially with all the e-initiatives the governments.

2) We need better logistics.  Running my online business was easy, because every street in Australia has a post box, you just pack your product, dump it in the post box, and it is garunteed to reach your customer the next day.  The postal service really needs to improve in the Middle East to accomodate online stores.

3) Lifestyle in the Middle East is different, countries such as Bahrain are small, if I need a product, I could simply drive for 5 mins and pick it up at the store.  So why should I buy it online?

4) Instant online payment gateways such as paypal do not work in the Middle East.  What this means, is that to accept payments online, you need to set up a merchant account, and to do that you need to be a business.  What this does in effect is that it stops individuals from starting their new entrepreneurial venture of setting up a online business.  In the UK, even 14 year olds have a online store.

So are there any opportunities for a online store in the Middle East?

1) Whilst a online store may not be ideal for selling to your local market, it is a great way to expand your business and sell to neighbouring countries in the Middle East and more importantly international markets.

2) How do you encourage customers to purchase from your online store?  Simple, give them a deal they can not get in a traditional store.  Price incentives are the best way to encourage online shopping.

3) If you are targeting your local market, try to ensure same day or next day delivery.  You might need to use a courier service, or simply deliver the product yourself!

4) First impressions are very important, you would not go to a meeting looking scruffy and unshaved! So make sure your online store looks professional, it not only increases the customers experience on your site, but it also instills trust in your business.

The face is that there are some succesful online stores in the Middle East, but in order to achieve this you really have to give customers a reason to purchase on your site.

If you run a online store, please add a comment and share your experience.

If you would like help with setting up a online store, please feel free to contact me at hussain@h2monline.com 

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4. Politics, a cup of coffee and online business
5. “Build it, and they will come” – The trouble with the Middle East dot com mindset

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