Technology & IT | Thursday 19 February, 2015 3:33 pm |

A new global study from PayPal and Ipsos * has revealed the UAE as the second largest market for Smartphone commerce, with 57 percent of online shoppers from the UAE buying via a smartphone in the past 12 months.

According to the research – conducted to investigate the mobile shopping habits of more than 17,500 consumers in 22 countries – mobile commerce is growing at nearly three times the rate of overall ecommerce.

China leads the way in Smartphone commerce with 68 percent of Chinese online shoppers surveyed revealing they have bought with a smartphone in the past 12 months, the UAE following with 57percent and Turkey with 53 percent.

The study’s UAE online shopper respondents also attributed on average 24 percent of their total online spend in the past 12 months to smartphone purchases, with Chinese consumers following closely behind at 21 percent and Turkey coming in third at 19 percent.

“We are on the cusp of the mobile-first era,” said Anuj Nayar, senior director of global initiatives for PayPal. “At PayPal we’ve seen our mobile growth rise from less than one percent of our payment volume in 2010 to more than 20 percent in 2014.”

A Bright Future for Mobile Commerce
As a percentage of global spend**, mobile commerce is still relatively small: according to consumers smartphone purchases account for nine percent of total online spend and purchases made on tablets account for only five percent of online spend.

While spend numbers might be low; the prevalence of mobile shopping is quite significant. A third (33 percent) of online shoppers surveyed report having purchased something via smartphone in the past 12 months, and 20 percent report making a purchase via tablet - with 33 percent of UAE online shoppers having shopped on a tablet in the past 12 months.

The research also reveals the surge in smartphone commerce is being driven by young adults – with a global average of 59 percent of smartphone shoppers are between 18-34 years. The UAE falls short of the global average, with 32 percent of smartphone shoppers aged 18-29, whilst the majority (61 percent) of smartphone shoppers in the UAE are aged 30-49.


UAE smartphone shoppers Opt for Apps Above Browsers
Globally, 64 percent of smartphone shoppers have purchased via an app in the past 12 months and 52 percent have purchased via browser. Among those who have used both platforms, apps are typically preferred, (47% prefer to shop through an app) - 59 percent of UAE smartphone shoppers revealing that they have shopped via an app on their smartphone in the past 12 months, compared to 52 percent shopping via a browser.

When smartphone and tablet users in UAE are asked about the benefits of using an app, 46% say that an app is a convenient way to pay, 39% say that it is a fast way to pay and 34% say that using an app is easier than paying by cash or card.

Top activities for UAE Smartphone users: product research, finding locations & price comparisons
Currently, the most cited commerce related smartphone activity among UAE smartphone users/owners is product research: 41% said they had “searched for product information on my smartphone” in the past 12 months, 35% have “used my smartphone to help locate/find information about a store or business” and 33% have “used my smartphone to compare prices while shopping in-store” (33 percent).

When the same smartphone owners/users asked how they’d like to use their smartphones in the future (out of activities they had not yet done), the top responses included “purchase from my smartphone while on the go – e.g. while on public transport” (selected by 21 percent) with an equal percentage opting for “sending money to someone else from my smartphone” – a nod to the majority expatriate population of the UAE – and to “use an app on my smartphone to make a purchase of pay a bill in a store or business” (selected by 20 percent).

Barriers to Mobile Commerce
The study also revealed the biggest barrier to faster mobile commerce growth is consumer’s inability to perceive the advantages over shopping on devices with larger screens.

Over a third (34 percent) of those UAE online shoppers who own a smartphone but who do not currently shop using a smartphone, “prefer to purchase online from other devices (e.g. laptop, desktop)” and the same proportion say that “the screen size is too small” Also 25% of those who don’t use their smartphone to shop online say “I rarely need to purchase online while on the go”.

Those who do shop via smartphone state similar reasons for not doing so more often: “the screen size is too small” (29 percent), “prefer to purchase online from other devices (e.g. laptop, desktop)” (24 percent), and “concern about security of online purchases made from a mobile device” (23 percent).


“Barrier to the expansion of mobile commerce will with the advent of lost cost mobile phones, larger phone screen sizes and mobile device security improvements, the barriers to mobile commerce will decrease,” continued Nayar.

Kivanç Onan, Regional Director of PayPal MENA & Turkey said:
“The Ipsos research has provided both PayPal and UAE merchants with invaluable insights into the mobile commerce landscape, not only within this region – which boasts the second largest Smartphone commerce in the world – but on a global level, which will be of notable interest to those merchants engaging in high levels of cross-border trade, identifying avenues for trade and growth opportunities around the world.

“Findings such as ‘59 percent of UAE survey respondents have shopped via an app on their smartphone’ also highlights the increasing need for businesses within the UAE to keep on the pulse of consumer shopping habits and strongly consider evolving the routes through which consumers access their business or service.”