Oman’s growing e-commerce scene is good business

Story – Gautam Viswanathan

Whenever I need to buy something, all I need to do is climb down two flights of stairs. The apartment complex in which I live has one supermarket on its left, and another on its right. A third is just a 10-minute walk away, and is located right next to a restaurant. Food, therefore, is not a problem. Nor is buying clothes particularly difficult: I live right above a clothing store.

For me to go shopping, therefore, and buy the essentials I need for my home and my family is extremely easy, because I am very lucky to have facilities that meet my needs so close to me. However, there are many for whom shopping does take a lot, lot longer, and requires plenty of planning in advance, because they don’t live near a supermarket.

A weekly shop for such people does require drawing up a list of what’s needed for the home, and forgetting to buy an essential item might not necessarily be something you can work around, because that requires you to once again spend a few hours going back and forth from the supermarket to your home to buy just that one item, time that would’ve been spent doing something else that might’ve been pretty important to you.

The advances of modern technology does, however, to a large extent ease the problems of those who have to travel a long way to shop: the internet was designed to break down physical barriers and transcend boundaries when it came to exchanging ideas and information, and a much-appreciated and fast-growing spinoff of the advantages the internet provides all of us is e-commerce.

E-commerce has given us the ability to buy things over the internet. This means the amount of time taken to buy things you and your family need (or want) is greatly slashed, leaving you plenty of time to do the things that have to be done. While it does cut down the time you’d take to shop, it’s also – truth be told – great for the rest of us. I mean, do you really want to get up halfway from binge watching your favourite TV show, playing that long-awaited video game, or break the bliss that comes from reading a book while curled up in the corner of your home?

The people it most helps, though, are those who face physical and mental challenges that make it quite difficult for them to buy things that are critical to them. E-commerce greatly reduces their dependency on others, and makes them more capable of leading independent lives. As is the case with countries all around the world, the interest and popularity of e-commerce is steadily growing in Oman.

Because technology has been around for a much bigger part of the lives of the younger generation, as compared to older people, it is easier for them to learn how to use e-commerce. Oman’s population is relatively young: according to data from the National Centre for Statistics and Information, at the end of 2018, 1.89 million of the country’s 2.57 million Omanis were under the age of 35. In addition, among foreign nationals in the country, 1.11 million of the 2.02 million expats in the Sultanate at the end of 2018 were below that age.

To find out more about how the arrival of e-commerce could benefit the Sultanate, T Weekly spoke with Dr Ahmed Al Hooti, a board member of the Oman Chamber of Commerce and Industry (OCCI), and the head of their economic analysis division, as well as Maimunah Shebani, the OCCI’s retail sector representative and the founder of The Retail Agency, an organisation that trains fresh graduates to work in the country’s retail sector.

“I believe e-commerce is very important, both for now and in the future,” explained Al Hooti. “Oman is planning to move forward, and quickly, to keep all companies, even in the small and medium enterprises, many of which employ the younger generation, to include e-commerce in their businesses. All of what we have seen in the country is working towards the establishment of a new ministry that will take care of the telecommunications sector, so things will move quickly. I think that in future, e-commerce will make up a big part of our business in the Sultanate.”

In addition, Maimunah Shebani said, “One of the benefits of e-commerce is that you can deliver goods twenty four hours a day, to any location the customer wants. That is the benefit of many of the big e-commerce chains today. This makes it really convenient for customers, because there are times when they need an emergency delivery, and the store may not be open for them. Better still, it lets you order things from the comfort of your home.

“You need to still wait for a couple of hours for your things to reach you, but now, more and more e-commerce chains that also operate physical stores do have an option where you can order things, and then collect them in-store, or personalise your order. This is particularly true in the case of the fashion industry,” she explained. “After all, no one is going to buy a shoe, or a shirt, or a dress without trying it on first. There are people who will have their own specifications and their own tastes, so they will want to customise their orders to suit their own needs.”

The growth of e-commerce will also be of particular benefit to small and medium enterprises, the creation of which is being actively encouraged by the Omani government. SMEs, however, are unlikely to have the budget that larger companies might have, making it harder for them to rent floor space or a shop at a mall in the country.

While this would’ve definitely hindered them in the past, e-commerce allows them to have a store on the web, one that can be accessed globally, and will allow them to focus on selling their products, while they might’ve otherwise spent some time worrying about the rental costs they were incurring.

“Website hosting services are not that expensive, anyway, and if you’re choosing to focus on a virtual store instead of a real one, it means you can divert your budget towards the things that are higher on your priority list,” explained Shebani. “For example, if you work in the packaging industry, you can hire three or four more people to package goods, giving you a greater output, you can hire a couple more salesmen to go out there and get more business.

“It helps you operate a leaner, more reactive company,” she added. “I think that is what is really important these days. You unfortunately see many companies that are unable to change fast enough with the times, and that means they ultimately lose out and go into decline, and require you to turn things around. It is really important to be in touch with things that are happening around the world and adjust yourself quickly and accordingly.”

While there is definitely a growing demand for e-commerce in Muscat and the rest of Oman, people in other Arab cities also want convenience when it comes to shopping. In their 2020 Global Consumer Insights Survey, financial services company PricewaterhouseCoopers (PWC) focused on 19,000 urban consumers in 29 countries, including 1,002 respondents in the Middle East region.

The aim of the survey was to get an in depth look at consumers in Abu Dhabi, Dubai, Riyadh, Jeddah and Cairo — to really understand where and how they shop, what their lifestyle is like and why they choose to live in their city, according to the report. The findings highlighted the unique differences between the consumers in the region and the ongoing transformation that Arab cities are experiencing compared to global changes.

In the Saudi Arabian cities of Riyadh and Jeddah, a minority of people now prefer to shop in store – 46 per cent of respondents in Jeddah, and 45 per cent in the capital, Riyadh, said they would prefer to shop in stores, which was in keeping with the sentiment both in Cairo and globally (47 per cent). However, in the UAE, respondents in Dubai (55 per cent) and Abu Dhabi (58 per cent) still preferred shopping in-store.

“For generations now, we’ve gotten used to the idea of going to the store and shopping there, which is why it might take people a lot longer to get used to the idea of an e-store, but that is the way forward,” explained Shebani. “We live in a world where there are economic constraints on how much people can invest into stores. Because e-commerce does not require a physical store, it means my overheads are a lot less, and I can continue to focus on a lean industry that is able to make revenues, and then maybe give it back to the employees, maybe in the form of subsidised housing, a transport allowance, something that makes them feel they are more valued and rewards their contributions.”

Although e-commerce did make certain processes more automated, particularly those regarding sales and payment, Shebani was quick to point out that while this would bring about a decrease in demand for certain jobs, it would definitely create requirements for more roles that would help people improve their skills. The growth of the e-commerce sector also acts a reminder for us to stay aware of global developments and adjust our skills accordingly, so that we continue to be in demand for those jobs that will arise in future.

“While some jobs will go away, it will lead to the creation of other jobs…jobs that are more in keeping with the needs of Omanis,” she explained. “A lot of recent Omani grads are specialists in the field of IT, because they all want to be part of the technological changes that are taking place in our lives, and this gives them the right foundations to work in e-commerce. While the front end of an e-commerce operation is just a screen, you will need people to programme these sites at the back-end.

“Then you are going to need people to handle customer services and deal with issues that crop up: all of us, eventually, want to talk to human beings, no one wants to talk to a machine, after all, and it is people who will help troubleshoot these issues,” added Shebani. “Some customers might also prefer to speak to someone to place their orders, so you need people to handle all of this.” – [email protected]