Saudi Arabia’s ecommerce market set to drive the growth of retail sector

Saudi Arabia’s ecommerce market set to drive the growth of retail sector

Some 74% of online shoppers in Saudi Arabia expect to increase their purchases from the kingdom’s ecommerce platforms compared to their purchases from China, GCC, Europe and US.

This is according to a report that explores the impact of cross border ecommerce in KSA by leading management consulting firm, Kearney and Mukatafa, a KSA organisation unifying the public and private sectors in the development of industry policy and standards.

However, further support will be needed to ensure a level playing field for all ecommerce players, thereby protecting consumer interests, and promoting local investments.

Market growth

Valued at SR19.3 billion ($5.15 billion), KSA’s ecommerce market is 6% of the overall SR347.2 billion retail market and this is expected to grow to reach 7.5% (SR34.7 billion) by 2026.

Cross-border ecommerce accounts for 59% of all ecommerce revenue (2021) and, while this is set to decrease (to potentially 49% by 2026) as local and hybrid players gain traction, it still dominates.

Consumers have voted with their purses to date, with the majority opting for cross-border platforms due to lower prices (72%), wider choice (47%), convenience (35%), and brand variety (31%).

Cross-border ecommerce

As of 2021, cross-border ecommerce accounts for 59% of all ecommerce revenue and, while this is set to decrease