Arab News, Wednesday , Jun 13, 2018 | Ramadan 28, 1439
EBay partners with noon for door-to-door Saudi and UAE deliveries
Saudis will soon be able to buy
goods directly from eBay and get them delivered to their doorstep.
It follows a deal between the e-commerce giant and regional shopping platform
noon.com, the online platform backed by Emaar chairman Mohamed Alabbar and Saudi
Arabia’s Public Investment Fund.
The agreement represents a major milestone for noon as it competes with
Amazon-owned Souq for supremacy in the Gulf region’s fast growing e-commerce
“With this (agreement), we are offering our customers access to products that
are not otherwise readily available in the region,” said Alabbar in a statement.
“Our partnership with eBay opens a whole new world of shopping experience.”
The new facility will be launched in the UAE and Saudi Arabia in the second half
of the year via a standalone app.
Noon and eBay will share best practices and explore joint marketing
opportunities as part of the agreement, noon said.
The partnership with noon follows the acquisition of regional rival Souq by
Amazon last year for $580 million.
Amazon rolled out its Amazon Global Store in December for customers in the UAE,
offering more than a million products including home goods, watches and shoes.
Amazon has been scaling up its presence in the region in the past months,
advertising for several jobs in Riyadh following a meeting in April between CEO
Jeff Bezos and Saudi Crown Prince Mohammed bin Salman in April, Bloomberg
Mohamed Alabbar unveiled noon in November 2016, saying that the platform would
go live in January 2017. But a series of setbacks, led to the service only
coming on stream in the UAE last September, and only going live in Saudi Arabia
The partnership with eBay provides noon the opportunity to compete with Souq on
“Being able to offer millions of products at any given time is a key
differentiator for any e-commerce player who wants to lead the industry,” said
Sauvik Tegta, a senior Manager at consultants A.T. Kearney
“Noon has already announced plans to offer a product assortment that exceeds 20
Million SKUs (stock keeping units), and the partnership with eBay will further
help it achieve and exceed this target. This is especially crucial considering
its competitor Souq.com already offers access to the Amazon Global Store
While e-commerce accounts for a tiny proportion of retail sales in the Gulf
region compared with markets in Western Europe and Asia, the rising penetration
of smartphones and the entry of leading global players such as Amazon and eBay
is forecast to accelerate growth in the sector.
“Consumer awareness was one of the barriers, but with Amazon entering the market
and with large investments from Noon and traditional retailers, e-Commerce has
garnered significant industry and the media spotlight that has raised its
profile across GCC,” said Tegta.
Significant progress has been made in the last mile delivery within the GCC, one
of the key challenges facing e-commerce players both in the region and abroad,
An example of this was the growth of local delivery firms such as Fetchr, which
raised $40 million in funding last year to scale up to meet growing demand for
online shopping deliveries.
But the region still faces a series of logistics challenges, Tegta said.
“Warehouses and fulfillment centres are still not optimally located close enough
to the market demand, so it can take several days to get products from a
warehouse to a distribution center,” he said.
The GCC’s e-commerce market is forecast to be worth $24 billion by 2020,
compared with $5.3 billion in 2015, according to A.T. Kearney forecasts.