As the global COVID-19 pandemic continues to spur e-commerce, a Mastercard study* has revealed the rapid growth of online shopping, with nearly three out of four (73%) UAE consumers shopping more online than they did before the pandemic.
The study provides significant insights into how shoppers are rapidly moving away from cash and opting for contact-free and digital payment experiences. These insights are helping e-tailers and businesses in the UAE, and across the region, to leverage the shift towards online shopping and to deliver fast, convenient and secure transactions.
Surge in Spending Across Sectors
According to the survey, FMCG (fast-moving consumer goods), healthcare, apparel and banking have seen the highest surge of online activity.
More than 73% of UAE consumers said they had shopped more online for groceries, 66% for clothing, and over 60% said they had purchased medicine online. And, as e-commerce increasingly becomes a part of everyday life, consumers are moving other aspects of their financial management to digital, with 70% of respondents having started banking online.
The research also reveals the rising impact of social media on consumer spending habits, with 72% and 56% of respondents saying they had discovered new sellers through Facebook and Instagram respectively.
Mastercard has been working with businesses, financial institutions and other stakeholders to advance digital payments in the UAE, and the pandemic has reinforced the necessity to continue evolving the safe and secure consumer payment experience. From a simplified online checkout experience to an in-store tap on a contactless terminal, it is evident that being able to respond to the rapidly evolving consumer expectations is a critical priority.
“There’s no doubt that the way we live and shop has changed drastically as a result of the pandemic,” said Girish Nanda, Country Manager – UAE & Oman, Mastercard. “With constraints imposed on our daily lives due to COVID-19, consumers are adopting new shopping and payment habits at an accelerated pace. Mastercard is working closely with its partners and businesses across the UAE to help them cater to consumer needs by offering fast, secure and efficient ways to transact. As this trend continues to evolve, Mastercard will continue to leverage its insights and technology, forging critical partnerships and driving innovation to ensure a solid foundation to deliver the future of payments in the UAE.”
The Rise of Virtual Experiences
While adapting to the ‘next normal’, people have been changing the way they consume entertainment and learn new skills.
In fact, 73% of UAE consumers said they were using the downtime as a positive learning experience. More than half of the respondents (51%) said they had taken a virtual cooking class, 34% have been mastering a new language and 26% have been learning to dance online.
44% of respondents have been educating themselves on Do-It-Yourself (DIY) projects, and just over a third (38%) said they have been learning how to film online.
As people spend more time at home, the demand for online entertainment has also surged with 78% of respondents having invested in entertainment subscriptions and 56% in online gaming.
Securing New Shopping Habits
With the rapid rise in online shopping, consumers are also becoming increasingly aware of the associated risks. More than half of consumers (57%) surveyed said that a secure checkout was fundamental for a good shopping experience.
This is a key priority for Mastercard, as it is working to reduce online fraud and protect retailers from data breaches, while ensuring that consumers still enjoy a convenient and hassle-free payment experience.
To advance these efforts, Mastercard recently rolled out its patented tokenization technology across the region. Tokenization encrypts consumer data by replacing card numbers with digital tokens. This prevents improper usage at any other location and provides additional security and peace of mind for consumers and merchants alike, resulting in higher approval rates while minimizing online fraud.
Methodology of Survey:
- 6x markets at 1,000 respondents each (South Africa, Nigeria, Kenya, UAE, KSA and Egypt)
- 3x markets at 500 respondents each (Ghana, Cote D’Ivoire and Tanzania)
- Online Survey