Online shopping is booming in the Middle East. But do customers (still) prefer malls?
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Shopping malls have survived the pandemic and store closings. Consumers have returned to malls, although a massive shift towards online shopping is accelerating the growth of the e-commerce sector. Experts estimate that 20% of people in the UAE now shop online. Additionally, according to a YallaHub estimate, the UAE’s e-commerce business is expected to reach $17 billion by the end of the year as more customers choose the ease of online shopping.?
But does the convenience of online buying reduce footfall at traditional malls? “The impact on mall footfall might vary based on consumer preferences and the experiential nature of malls. While some may still prefer the social aspect and experience of physical shopping, online shopping caters to convenience, especially for those with time constraints,” says Dr. Rahim hussain , Associate Professor of Marketing at the University of Dubai . “Certain product categories might witness a more significant shift towards online purchases.”?
Dr. Hussain explains that online shopping is changing the traditional shopping experience in Dubai. Online platforms’ convenience, variety, and competitive prices influence consumers to choose virtual shopping experiences. This change is not only driven by technology but also by evolving consumer behaviors and lifestyle demands in a fast-paced city like Dubai.
However, malls must adapt to keep consumers coming in. Traditional retail businesses can capitalize on the trends and lifestyle changes as the new generation of shoppers has an increasing desire to support local businesses. “In-mall stores can use this to their advantage. Too many options are also a problem where customers can be fatigued and ultimately not know what to choose. Using digital platforms to their advantage, brands and stores can collaborate with local businesses for in-mall pop-ups and other exclusive activations,’ says Mehreen Kassam , brand and communications specialist at Nikon MENA. “Driving customers back by making it an experience that extends beyond shopping.”
Experts say brands can also employ technology to drive people to in-stores, “Implement technology solutions such as mobile apps for easy navigation, augmented reality for virtual try-ons or smart fitting rooms to enhance the shopping experience and differentiate from online competitors,” says Aditi Vyas Kumar ACIM , a chartered marketer.
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In 2022, Mall Of The Emirates collaborated with Cisco to bring customers an immersive shopping experience.”That Concept Store offers a personalized and immersive purchasing experience by combining digital technologies with physical shopping,” adds Vyas Kumar.
Regardless of how handy internet shopping may be, malls have strategies to attract customers. They are a mixed-use destination that encourages shoppers to come and stick around. “Despite the rise of online shopping, Dubai’s mega-malls such as Dubai Mall and Emirates Mall remain iconic tourist attractions, offering not just retail experiences but entertainment, dining, and cultural attractions,” says Dr. Hussain.
While the increase in online shopping may impact the retail landscape, malls are likely to adapt by integrating online and offline experiences, leveraging technology to enhance customer engagement, and offering unique experiences beyond just shopping.?
“So, while there might be changes in consumer behavior, the significance of malls as tourist destinations is likely to persist,” adds Dr. Hussain.?
These retail centers have evolved into more than just shopping places; they are hubs for entertainment, culture, and technology.
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