By Sachin Kumar
DOHA: Qatar’s e-commerce market is poised for strong growth in the coming years. The B2C (Business-to-Consumer) market or e-commerce market in Qatar, currently pegged at $1bn, is likely to double in the next five years. According to the Ministry of Information and Communications Technology (ictQatar), this market is expected to grow at Compound Annual Growth Rate (CAGR) of 17pc over the next five years. E-commerce refers to the use of Internet to conduct business transactions between individuals and organisations.
“While Qatar’s e-commerce market is not yet fully developed, Qatar has many of the key ingredients to realise favourable social and economic returns, including a population with high disposable income, a strong and secure ICT (information and communication technology) infrastructure, and a highly connected society,” said ictQatar in a recent note. “In fact, Qatar has the potential of doubling its forecast e-commerce market size by leveraging the large investments in ICT, the growth in the SME sector, and the ongoing investments in the logistics sector,” it added. E-commerce is relatively limited in Qatar as the concept of online payment and online trade is comparatively new to residents here. However, going forward high penetration internet will work in favour of fuelling the growth of e-commerce
“Qatar is the seventh largest B2C market in the Middle East and North Africa (Mena) region with huge growth potential in the future. Rising awareness among residents about e-commerce and high Internet connectivity will help in its growth,” a senior ictQatar official told The Peninsula. “The use of e-commerce can significantly benefit the economy since it gives businesses better access to customers, lowers staffing and space needs, and provides an efficient channel for promotion of goods and services,” he added.
E-commerce is consistently growing globally and in Mena. Online spending in the Middle East went from $300m in 2011 to $600m in 2012, and it is predicted that it will reach $1.1bn in the region by 2015.
Qatar has the highest average annual e-commerce spend per user in the MENA region and average value per online transaction is higher than the GCC average, according to ictQatar. Airline tickets and consumer electronics are the dominant B2C segments, making up approximately 40pc of the B2C market in Qatar.
Qatar released its e-Transactions and e-Commerce Law in 2010 in order to foster business usage of e-commerce.
Experts say that there are certain issues which need to be addressed for continued development of e-commerce.
Awareness of e-commerce needs to be increased and trust between consumers and merchants needs to be built. Currently, cash on delivery is 80 percent of the regional e-commerce, mainly because of low levels of trust between parties.
According to users, delivery and shipping logistics are also areas which need attention of companies and other stakeholders in e-commerce market.
THE PENINSULA
