The Marketplace Model in the Middle East: Challenges and Solutions

March 12, 2019 posted by VANI

The present market situation:

Virtually, the e-commerce market is flourishing around UAE and Saudi Arabia. With Amazon's investment in Souq.com, it has opened opportunities for other
e-commerce companies to open shop too. Other platforms like Noon.com, Tejuri and Namshi have taken the Middle East by storm. The BMI research report states that the Middle East market is expected to grow 16.4 % in the next three and a half years. But these projections are still weak considering its tremendous potential to sky rocket.

The marketplace model in the middle east challenges and solutions VINIEO PIM

Weak e-commerce marketplace models, low credit and debit card penetration and feeable payment routes are challenges they need to tackle.

What the Middle East can learn from China:

While many countries are still learning about online platforms and its benefits, China's learning curve is so far ahead that in 2017 they made $1 trillion in online sales. Their internet penetration goes deep into their rural side where the locals have started selling their items online too. Although, we agree following this model is not as easy as it looks, it has brought not just the people in urban areas, but people from villages and small towns to participate. Officials in rural areas have made it a mandate to keep pushing the concept, spreading awareness about selling online and in turn create wealth, jobs and economic development.

The governments that make up the Middle East could take this example and implement it in their own way. There are emirates that could be benefitted by this model. But there are challenges that are unique to this region - no postal addresses, credit and debit card fraud that make people wary of using them are major challenges that seem to stand in the way of really boosting up the sales in this particular region.

Challenges and Solutions of the Marketplace Model:

The e-commerce business sellers are clearly facing some prominent problems in functioning in the Middle East.

Delivery Inconvenience- The sellers try to deliver their products on time to the consumers. But because of lack of postal and street addresses in Dubai and most of middle east regions, the delivery is hampered unlike in other countries with quick and accurate delivery for products by the e-commerce companies.

The solution would be to get on board local delivery companies instead of international delivery agencies. They would know the region and locale, and drop your product or package easily, at the location.

Lack of awareness about Contrabands- There are sellers who are unaware of selling some products that the government has made illegal to sell online in middle east. This might get them into trouble. Unlike other countries, the Middle East has some strict rules of buying or selling contraband products.

The solution would be to get these rules and regulations available to the sellers by the government or by the
e-marketplaces so they become more aware.

Lack of usage of internet- Apart from Dubai and a few other countries, the Middle East regions are not internet and smartphone driven as most of the other countries. They definitely use the internet, but on a much smaller scale. The usage of the internet to buy and sell products or services is minimal because of the lack of awareness of buying things online. The local merchants are unaware that instead of only selling offline in a particular locale, they can sell their products online and reach a wider market.

The government is trying to facilitate the use of the internet to various locations, and with the increasing use of smartphones among the young population of the country, the B2C marketplace platforms are anticipating online shopping as the next thing flourishing in the region.

Challenges of accurate data upload- Sellers consider data entry as a challenge. They have to visit various
e-marketplace platforms to change data according to the requirement, which is inconvenient, exhausting and increases the chances of errors. There is a need for a platform like a PIM that publishes accurate data on various e-commerce platforms at once.

The PIM (Product Information Management) systems like VINIEO which is a platform that helps in publishing contents specific information to various platforms at one, as per the requirement.

A detailed look at PIM:

PIM is a set of systems, strategies, processes that manage product data that retailers and manufacturers could use to streamline their product detail across multiple channels. Prices, discounts, product descriptions can be altered and managed from one single platform. Installation of such software could really pick up the pace of many online businesses by providing seamless user experience and rich product content. Middle East or China, PIM is an essential addition to any vendors' business.

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