Shopper trends and growth opportunities for brands in the United Arab Emirates

Finn Owens

November 24, 2022

Pattern’s 2022 Amazon United Arab Emirates (UAE) shopper research has highlighted the consumer habits in the region, and demonstrated why it is fast becoming one of the most exciting growth opportunities for brands selling online.

We surveyed UAE online shoppers at the beginning of 2022 to determine how their shopper behaviour was likely to develop during the year compared to 2021. We compiled our findings in the UAE Shopper Report 2022 and share the most interesting insights shown below.

Shoppers have an appetite to spend

Online spending in the UAE is set to see a year-on-year increase during 2022. Overall, 74% of online shoppers polled said they would spend more online shopping this year compared to 2021.

A further 19% expected to spend the same as in 2021, with just 6% expected to spend less. Of the 74% who expect to spend more during 2022, nearly half (47%) said this figure was likely to be a lot more.

Online marketplaces lead the way

More respondents expected to purchase online this year from Amazon or Noon than other online retailers for every major product category, including fashion, consumer electronics, home and kitchen, and beauty.

For example, in the consumer electronics category, 61% of online shoppers expect to buy from Amazon, and 42% from Noon. In comparison, only 14% expect to buy online from retailers with both stores and a website. For home and kitchen, 60% expect to buy from Amazon, 46% from Noon and just 18% to buy online from retailers with a store and website. This pattern is mirrored in many other categories.

Amazon opens new doors

The opportunity for consumers to discover new products and brands through Amazon is evident. 42% of Amazon.ae shoppers purchased a product from a brand that they had never purchased before. Our findings show that Amazon.ae is a great platform for brands to raise their profile amongst UAE’s online shoppers.

Our UAE Shopper Report shows the growing popularity of Amazon in the region, with shoppers using Amazon to find new products and discover new brands. With increases in usage, spending and Prime membership across almost all age groups, Amazon.ae is a platform where consumer brands must build a strong presence if they want to achieve Middle Eastern sales growth. The UAE’s ecommerce market size is predicted to grow from US$10 billion in 2021, to US$17 billion in 2025, reinforcing the opportunity for brands to achieve profitable growth in the region.

Download the full 2022 UAE Shopper Report to learn more about the insights we have gained from this research.

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Why Your Ecommerce Brand Needs an Accelerator
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Why Your Brand Needs an Ecommerce Accelerator to Grow on Global Marketplaces

If you’re in the ecommerce space, you’ve most likely heard of a rising category of brand partners: accelerators. Since the term is still fairly new in ecommerce and across marketplaces, brand CEOs may question the true benefits to their brand by partnering with one.

It’s notable that brands like Spectra Baby, one of Pattern’s brand partners based in the U.S., are experiencing significant success with ecommerce accelerators. Alone, Spectra lacked the right resources to gain control and narrow distribution strategy. But now that they’re partnering with an ecommerce accelerator, they have the benefit of all of the marketplace tools and expertise they need to drive results—a consistent, 60% year over year increase in their revenue.

How a Brand Finds Success with an Ecommerce Accelerator

An ecommerce accelerator layers on top of and amplifies a brand’s current efforts in whatever marketplaces and channels are part of its ecommerce strategy. Many brands simply don’t have the bandwidth to do ecommerce the right way—it takes a full army of experts.

As the world’s leading ecommerce accelerator, Pattern is well acquainted with the issues you face, and has the required resources to achieve the best brand performance across ecommerce.  Partnering with Pattern, CEOs get the added benefit of extensive experience across multiple marketplaces, regions, and industries.

How an Accelerator Can Make a Big Difference for Your Brand

Provides an Outside Solution to Execute Ecommerce Strategy

Time and time again, we see brands don’t have the resources they need to succeed on ecommerce marketplaces. And it’s no surprise—the ecommerce space is crowded, competitive, and vastly different from a traditional, brick-and-mortar sales model.

To execute your strategy correctly, you need to have SEO experts, creative resources, data analysts, brand control experts, fulfillment specialists…the list goes on. 

So, brands have the choice to either ignore issues they’re experiencing or find outside help. We don’t recommend the first option—issues that seem small now will get out of hand fast, and the further problems develop, the more difficult it is to contain them. It’s definitely doable to reverse damage from poor product listings, negative reviews, and low organic search rankings. But it’s all the better to avoid those issues in the first place.

Ecommerce Accelerators Amplify Brands

Partnering with an ecommerce accelerator is the best way to gain control of your strategy and experience the healthiest and most profitable growth for your products.

Accelerators work because they layer on the top of systems, processes, and teams you’re already using. If you’re experiencing success in your D2C efforts and in specific marketplaces, an accelerator won’t “rip and replace” what’s already working. Instead, they’ll add the resources you’re missing in your strategy to fix issues and expand your presence across global marketplaces.

Accelerate your Ecommerce Strategy with Pattern

As a pioneer in the ecommerce accelerator space, Pattern knows the ins and outs of great ecommerce strategy for global marketplaces. We’re fanatical about great data and obsessed with growing our partners’ ecommerce profitability. With pioneering technology, vast expertise, and highly capable internal teams, we have the resources you need to establish and grow your ecommerce presence, brand control, and profitability. 

Ready to explore an accelerator partnership? Set up a meeting here.

2022 Traffic Decline
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Stop Declining Web Traffic: What Your Brand Should Do

2020 and 2021 was a monumental period for the retail sector. Consumers suddenly embraced ecommerce, due to worldwide COVID-19 restrictions. Now that restrictions have eased and physical stores have reopened, many retailers are experiencing a drastic decline in online web traffic. Research shows that traffic to online ecommerce and grocery shopping sites fell 15% in the first five months of 2022, compared to 2021 levels ([SimilarWeb, 2022](https://www.chargedretail.co.uk/2022/07/08/online-retail-and-grocery-traffic-take-a-tumble-in-2022-as-cost-of-living-crisis-intensifies/)). Although shoppers have the option to buy in-store again, the ecommerce boom has still accelerated the rate of ecommerce channel growth. Since consumers are more comfortable purchasing online, maintaining and optimising your ecommerce channels is as pertinent as ever. Earlier this year, Pattern Senior Strategists Hannah Staveley and Peter Boldt-Christmas hosted a LinkedIn Live to address the shift offline, how brands can tackle declining web traffic, and offer guidance to brands struggling with web traffic. Who is Affected? Online-only retailers and marketplace sellers have been hit significantly, due to a lack of channel diversification and an overreliance on online sales channels. Following a wave of success during the pandemic, many brand’s direct-to-consumer (DTC) websites are now experiencing declining web traffic after failing to optimise their operating models and propositions in order to retain consumers. Depending on the maturity of the pre-pandemic ecommerce landscape in each sector, different industries require different strategies to mitigate the effects of declining web traffic. For instance, whilst Q-commerce (quick commerce) has grown significantly, consumers are still opting to purchase their groceries in-store rather than online. Pattern's [2022 UK Shopper Report](https://info.pattern.com/uk-shopper-report-2022) supports this trend, indicating consumers were much less likely to use online channels to shop for food, pantry, and alcohol compared to product categories like books and clothing. Omnichannel Solution for Brands Strengthening your brand’s omnichannel proposition is essential. In Pattern’s benchmarking research with Google, we found that 75% of retailers and brands improved their omnichannel proposition scores since 2019 showing that they had implemented more of these functionalities, or otherwise improved them ([Pattern & Google, 2021](https://www.thinkwithgoogle.com/intl/en-apac/future-of-marketing/digital-transformation/omnichannel-marketing-retail/)). Brands should raise awareness of their online sales channels, such as their website and app, through a number of offline initiatives, including visible in-store advertisements, providing free in-store WiFi, QR codes on product labels, displays, and advertisements, and providing Click-and-Collect services to mend the division between offline and online spaces. How to Succeed Exclusively Online If you have limited control over your offline footprint, or are selling online-only, accelerating your presence on marketplaces can be a strong solution. Marketplaces, such as Amazon, eBay and Tmall, offer a cost-effective and straightforward route to acquiring new customers due to their immense penetration and delivery proposition in the global market - particularly in Europe and Asia. Shoppers are now five times more likely to to search for initial product information on marketplaces than through a brand’s DTC website, according to research from InRiver ([Rigby, 2021](https://internetretailing.net/marketplaces/shoppers-now-five-times-more-likely-to-look-for-a-product-on-a-marketplace-than-on-a-brand-website-study-24025/)). 63% of respondents in our [2022 UK Shopper Report](https://info.pattern.com/uk-shopper-report-2022?) stated they visited marketplaces to check the prices of products, and 50% stated they used marketplaces to look for product information, including reviews. To succeed on marketplaces, brands must differentiate their range and overall proposition from their other sales channels. For example, luxury Whisky maker Macallan surged to number 1 position in terms of revenue within the BWS category on Amazon UK by focusing its listings on premium and limited edition products. Similarly, some of the best-selling and fastest growing spaces within Amazon’s spirits category are low distribution, large format products like magnums and methusalehs. This is likely because many shoppers use Amazon as a gifting destination and are looking for high-end, novelty products. Pattern’s [2022 UK Shopper Report](https://info.pattern.com/uk-shopper-report-2022?) found that 67% of UK shoppers bought gifts on Amazon. Brands can use search and category data to understand where latent consumer demand exists, utilising this as the basis for product differentiation strategy. Boost Traffic to My Brand Marketplaces Keyword research is integral to boosting your brand’s visibility on marketplaces like Amazon. Moving away from a brand defence strategy, to focusing on challenging for placement on the highest volume keywords is an approach that we’ve seen many brands succeed with in the last year. However, thousands of new sellers are joining the platform everyday, making search engine results pages (SERP) placement competition increasingly fierce. Brands must also optimise their product display pages (PDPs) to ensure the improvement of their organic ranking results and conversion rates. DTC Due to high customer acquisition costs, the current retail environment is challenging for brands. In order to develop the most appropriate proposition, brands must understand their target shoppers’ needs and behaviours. During lockdown restrictions, shoppers valued convenience and speed, influencing brands to offer faster and more flexible delivery options ([McKinsey & Co., 2022](https://www.mckinsey.com/industries/retail/our-insights/adapting-to-the-next-normal-in-retail-the-customer-experience-imperative)). However, with restrictions eased and economic pressures felt by shoppers, value is being favoured above convenience. Our data shows sites that provide money saving and price comparison tools experience rapid growth in traffic this year. Therefore, evaluating the value that shoppers gain by purchasing from your DTC website is key to maintaining and growing your site traffic. Value can be provided in a number of ways but needs to be relevant to your target market. Cutting free shipping thresholds, offering 24/7 customer service, providing free samples, free live chat, and other services can all provide your shoppers with value, enhance their shopping experience, and ultimately influence their decision to buy. Want to learn more? [Watch the full LinkedIn Live discussion](https://www.linkedin.com/video/event/urn:li:ugcPost:6970333515246661632/). Accelerate your Ecommerce Strategy with Pattern As the world’s top ecommerce accelerator, Pattern knows the ins and outs of great ecommerce strategy for global marketplaces. We’re fanatical about data and obsessed with growing our partners’ brand and exceeding sales goals. With custom technology, vast expertise, and highly capable internal teams, we have the resources you need to grow profitability. Ready to explore an accelerator partnership? [Contact us here](https://pattern.com/uk/contact/).

1P vs 3P
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Amazon 1P vs. 3P: Pros & Cons Brands Need to Know

Whether you’ve been selling your products on Amazon for years or you’re just starting out, you’ve probably wondered if 1P or 3P is the best selling model for your brand. As the top ecommerce accelerator, and 3P seller, with deep experience on Amazon, we know there’s no “best way” to sell on Amazon—it depends on your products, long-term goals, and  capabilities. 

In a 1P, or first-party relationship, Amazon buys your product wholesale and handles most of the selling details. In a 3P, or third-party relationship, you’re an independent seller on Amazon’s marketplace, which gives you both more control over your brand and more responsibility for logistics.

Deciding between 1P and 3P requires weighing the various pros and cons for your business. Brands should consider several factors before choosing which strategy makes sense. Here is more information about the pros and cons of both 1P and 3P so you can make the best decision for your brand.

1P Pros and Cons 

Pros:

  • Amazon is a well-trusted brand and consumers may trust your brand more if it is sold by Amazon.

  • Your products are automatically eligible for Amazon Prime and two-day shipping.

  • Amazon handles all the logistics: taxes, ASIN, optimisation, and customer service.

  • Amazon gives exclusive benefits, such as placement priority and advanced analytics tools, to 1P sellers.

  • Selling your products through Amazon 1P could be the most price efficient option for your brand.

  • You are basically free of inventory risk.

Cons:

  • You may lose profit margins.

  • Amazon will pay you less frequently than a 3P relationship.

  • You will have little control over availability of inventory on Amazon at any given time.

  • Amazon can drop you as a 1P seller at any time.

Many brands choose to sell on Amazon in a 1P relationship so they do not have to manage most of the logistics and simply prefer Amazon to do it. In addition, having  a well-trusted brand sell your product is another top consideration in a 1P seller relationship.. 

3P Pros and Cons

Pros:

  • Gives you more flexibility and control in every aspect of the selling process.

  • Strengthens your brand presence.

  • Helps you gain better access to data.

  • Provides more control in the selling process (pricing, inventory, and product listings).

  • Offers complete control over how much inventory to list.

  • You can share inventory across marketplaces, when necessary.

  • Creative control to  develop listings with better optimised content to tell your brand story.

Cons:

  • Inventory risks.

  • Responsible to create purchase orders and handling inventory logistics.

  • You are responsible for your own customer service.

  • Brand must pay additional fees to Amazon for being a 3P seller.

  • Can be subject to account suspension.

Selling on Amazon in a 3P relationship  is an increasingly popular option for brands, and it’s easy to see why. Even though becoming a 3P seller may seem like more work upfront, it ultimately gives you more flexibility and control, a stronger brand presence, and better data access.

How Do I Become an Amazon 1P or 3P Seller?

You can only become a 1P seller through a direct invitation from Amazon. To become a 3P seller, the first step is setting up a Seller Central account. You’ll then provide relevant information and verifications before getting your account approved and finally listing and shipping your products. 

3P Partners and Other Selling Model Strategies

While deciding between a 1P or 3P relationship is a solid start, selling model strategy is a bit more complicated than that. In fact, there are 7 common selling models brands may consider. Two of these models are the basic 1P and 3P models we’ve already discussed. 

Other models include the following:

  • 3P Unmanaged: no active management of your brand

  • 2P: Fulfilled by Amazon (FBA) model

  • Hybrid: leverages both 1P and 3P strategies

  • 3P Network: you create a network of authorised sellers

  • 3P Partner: you partner with one exclusive ecommerce seller

Pattern Proves the 3P Partner Model Works for Brands

In our experience, the ecommerce executives benefit most from a 3P partner model because it provides the most freedom and marketplace control on Amazon, without having to worry about complex logistics. Pattern executes a 3P exclusive seller model because it gives our partners  the freedom and control unavailable through a 1P relationship, while also taking on the stock, management, and risks that make 3P selling intimidating.

With Pattern as your authorised wholesale partner, we buy your stock and resell the products on Amazon as an authorised seller. Once we buy your product, we’re responsible for all inventory risk, and help you optimise your content and advertising while maximising your brand protection and brand global distribution. Our sophisticated inventory forecasting, fulfilment, and logistics systems help us predict and manage your inventory, and our experienced teams handle everything from taxes to customer service.

Unlike a 1P Amazon seller relationship, we’re eager to involve your brand every step of the way, including when it comes to branding, promotion, channel strategy, and new product launches.

Interested in increasing your margins by transitioning to a 3P relationship and partnering with Pattern? Get in touch today.