Benchmarking against Amazon, the second largest e-commerce platform in the Middle East has explosive potential!

For many years, the main markets that cross-border people have focused on have been Europe and the United States, but with the influx of countless sellers, competition in the red ocean market has continued to intensify, and opportunities have become fewer and fewer.

However, in addition to the mainstream markets in Europe and the United States, some blue ocean markets have gradually emerged in recent years, attracting the attention of a large number of sellers, such as Latin America, Southeast Asia, and the Middle East market with a scale of hundreds of billions.

With the widespread popularity of the Internet, the e-commerce market in the Middle East has quietly risen and has now become a shining "new star" in the global e-commerce market. Noon, the second largest e-commerce platform in the market, has also been noticed by more and more cross-border people.

Noon has unlimited potential to compete with Amazon

With the rapid development of the global e-commerce economy, the Middle East has become a new blue ocean market in the field of cross-border e-commerce with its advantages such as superior geographical location, huge consumer groups, and extremely high Internet penetration rate.

In this "hot land", there is no shortage of e-commerce platforms competing for market share, and the local platform Noon is one of them.

At present, it has become one of the leading e-commerce platforms in the Middle East. If we put aside Amazon's Middle East site, Noon can be regarded as the largest local e-commerce platform in the Middle East, occupying an important market share in Saudi Arabia, the UAE and other countries.

In fact, Noon’s current status has a lot to do with its founder’s positioning and development strategy.

As early as the beginning of its launch, Noon's founder Mohamed Alabbar realized the importance of e-commerce in today's era, and said that in the future he would build the platform into an e-commerce platform with 20 million types of goods, and strive to make it the "Amazon of the Middle East . "

According to information, Noon was founded by UAE entrepreneur Alabbar and Saudi Arabia's sovereign wealth fund in November 2016 with $1 billion . In 2017, the platform was officially launched in the UAE and soon expanded to Saudi Arabia.

Although it entered the market a little later than Amazon's Middle East site, Noon has strong financial strength and can be said to be a heavyweight e-commerce platform. Its online website's payment, distribution, warehouses and employees are basically comparable to Amazon's Middle East site . This advantage also laid the foundation for its subsequent development.

In 2018, Noon further expanded into the Egyptian market in the Middle East, becoming an important e-commerce platform in the three core markets of the Middle East. In 2019, Noon launched its own payment system, Noon Pay, which basically improved the front-end shopping platform and the back-end payment system, providing all-round protection for local users.

Between 2020 and 2022, Noon launched the "NowNow" instant delivery service for online food and daily necessities, as well as the "Noon Express" service to help sellers improve delivery efficiency. At the same time, Noon's UAE and Saudi Arabia sites also opened up for investment, becoming an important platform for a large number of Chinese sellers to enter the Middle East market .

In 2023, Noon announced the launch of a customer loyalty program called "Noon One". All buyers who want to participate in the program will need to pay, and then they can enjoy services such as free shipping, which is similar to Amazon's "Prime" program.

In response, the platform's person in charge said, "We hope to solve the troubles of online shopping and support customers by saving money. This new plan will help users buy a variety of products and services online more easily."

It is worth mentioning that, to date, Noon and Amazon Middle East have a market share of more than 50% of the total e-commerce sales in the region, with Noon covering more than 20% of the market share . In the Middle East, it has formed a strong competitive relationship with Amazon and has become one of the most promising e-commerce platforms in the market.

Backed by a market of more than 300 billion

Industry insiders pointed out that Noon is one of the preferred platforms for Chinese cross-border enterprises and sellers to expand overseas.

The reason for this is that, on the one hand, the platform has a rich variety of products, and the threshold is low and relatively friendly for small and medium-sized enterprises engaged in cross-border e-commerce.

After years of development, Noon's product line has continued to expand and currently covers multiple categories such as beauty, fashion, electronics, home, kitchen and daily necessities, basically meeting the diverse needs of local consumers.

It is understood that the Internet and smartphone penetration rates in the Middle East are relatively high. Therefore, on the Noon platform, consumer electronics products have always been popular among local consumers, such as smartphones, smart TVs, drones, cameras, Bluetooth devices, speakers, etc.; the demand for fashion products is also quite high, including watches, shoes such as sneakers and sandals, and clothing such as T-shirts and dresses; in addition, beauty products (eye shadow, lipstick, shadows, etc.), home products (smart home devices, sports home products such as balance bikes, kitchen supplies such as air fryers and electric kettles), etc., are very popular among Middle Eastern consumers.

Sellers planning to enter this platform may wish to use the above best-selling products as a reference and promptly update the direction and scope of product selection in line with social trends and consumer preferences.

On the other hand, the market development prospects of the Noon platform are relatively broad and the consumer base is huge.

The population of the Middle East is over 300 million, and consumers generally tend to be younger and have strong purchasing power. In Gulf countries such as Saudi Arabia and the United Arab Emirates, the Internet penetration rate is as high as 98%, and e-commerce retail in the Middle East accounts for only 2% of total retail sales, far below the world average of 10%.

On this basis, the agency predicts that the scale of e-commerce in the Middle East is expected to show explosive growth in the next few years, with an annual growth rate of 25%-30%.

Data shows that the Middle East is one of the fastest growing e-commerce markets in the world. In 2023, its e-commerce market size has reached 106.5 billion UAE dirhams (about 211.9 billion yuan), an increase of 11.8% year-on-year. It is expected that by 2028, this figure will reach 183.6 billion UAE dirhams (about 365.3 billion yuan), with a compound annual growth rate of 11.6%.

Among them, the UAE, Saudi Arabia and Israel are the largest e-commerce markets in the region, accounting for about 72% of the total market size. Take the UAE as an example. Its e-commerce market size will reach US$11.01 billion (about RMB 80.4 billion) in 2024, and is expected to further grow to US$18.99 billion (about RMB 138.9 billion) in 2029, with a compound annual growth rate of about 11.52%.

As the scale of the Middle East e-commerce market continues to expand, this 100 billion-level blue ocean market and local e-commerce platforms including Noon will be noticed by more and more cross-border sellers. However, for cross-border people, opportunities inevitably coexist with challenges. When sellers enter new markets and new platforms, they must proceed from their own actual conditions.