Dubai: The UAE’s e-shopping portals are not having it all their way during the massive end-of-year promotions. Brick-and-mortar retailers are hitting back with up to 80 per cent discounts and some of the most generous promotional offers in recent years.
Abu Dhabi has just launched a highly coordinated two-month winter promotion at its malls and outlets for the first time, while Dubai will get its annual Shopping Festival rolling a few days in advance than is usual. And with the newly announced UAE Government sponsored ‘World’s Coolest Winter’ to go live, UAE’s malls are expecting some better traffic… and sales.
“Mall-wide promotions in recent weeks are scoring, though still down from the same period last year,” said the CEO at one of the biggest apparel brands in the market. “This could be due to the limit on the number of shoppers allowed in at any time.
“Our online too are much higher then in previous years, but haven’t not make up the deficit between overall sales for the same period last year and this year’s. But we still have a few days to go for the year to close… there’s still hope.”
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Who’s winning
Among categories, electronics and gadget sales saw the biggest spike during the Black/Yellow/White Friday promotions, with the first mass deliveries of the new iPhone 12 cited as the main reason.
“But fashion-related sales were down 25 per cent compared with a year ago,” said Sandeep Ganediwalla, Partner at RedSeer Consulting. “Luxury category sales were more resilient, but the mass category was impacted by lower tourist inflows.”
This is what the World’s Coolest Winter will be hoping to correct during its 45-day promotional run. Any increase in arrivals will help UAE’s malls and souqs score, as well as tourist dependent categories such as gold and jewellery.
Image Credit: RedSeer Consulting
Perceptions
Where online retail still wins big is on perceptions. RedSeer research finds more than 66 per cent of customers in UAE rate online promotions to be better than what’s offered offline.
“Online brands ran aggressive Black Friday promotions while offline players had ‘Super Sales’ and UAE National Day sales,” said Ganediwalla. “November has now turned into an important sales period for retail – no one is waiting any longer for December to roll around.
“But offline retailers also ran aggressive promotions and captured almost 60 per cent of the market during the Black Friday promotion period.”
Who’s discounting more
Brick-and-mortar retailers will never be able to match the almost daily variations that their online peers can bring to discounts and special offers. The portals can even bring about changes by the hour depending on what their algorithms are saying about what’s likely to get shoppers to buy.
Without those consumer insights, malls and brick-and-mortar retailers are hitting back with one consistent message – “Get big discounts”. Industry sources say that the up to 80 per cent off promotions are hitting the mark, going by the initial days of the ‘Retail Abu Dhabi’ campaign.
Image Credit: Clint Egbert/Gulf News
Discounting by season, generation
On the latest tech products. “We do not see any major discounts,” said Alex Tchablakian, Chief Operating Officer at LetsTango.com. “Despite the competition being so tight, the availability on these gadgets is still scarce.
“But on previous generation items, we do see major discounts during this period, as well as with all the clearances. We helped clear out a lot of our vendors’ goods with up to 90 per cent off during these promotional periods.”
Outside of online, the biggest discounts were available at outlet malls, according to RedSeer findings.
Online perception of discounts were higher, with more than 60% of respondents mentioning online to be better than offline. By we see that on average outlets malls had the higher discounts followed by online brands
Drop shipping charges
Loyalty membership programmes were another way shoppers saved on their transactions. While noon and Amazon offer free deliveries to members, “Other portals decided to keep a minimum order value to be eligible for free deliveries,” said Ganediwalla. “But some also gave free delivery irrespective of the order value.”
It is that kind of year – shoppers are willing to switch to any portal or store that helped them buy by spending less. “It’s no surprise online retailers are dropping shipping charges,” said Tchablakian. “Online retailers would want to remove any hindrance in order to convert from someone browsing for a product to actually buying. If dropping shipping charges help, then it all adds up to their end-of-year sales.”
Image Credit: Supplied
Build loyalty
And in what could be a first, Abu Dhabi’s ongoing retail promotion is offering a membership programme that will offer special ‘exclusive to Abu Dhabi’ deals and experiences. Until now, loyalty schemes came from retailers, malls and online marketplaces; but here you have an entire “geography” trying to win over shoppers to come and buy.
The rules of the retail game have changed…
Shipping charges are a factor for customers when they reach the checkout page – and online retailers would want to remove any hindrance
