Digital failings cost Egypt’s businesses dearly

• Outdated online strategies
• Key sectors under-digitalised
• Potentially $1.4bn exports lost

From old-fashioned marketing strategies to so-called “ghost companies” with a completely outdated online presence, Egypt’s private sector is failing to move with the digital times, a new report has found.

Four in five Egyptian businesses exhibit characteristics of “digital ghosts,” with ill-designed or inactive websites and underutilised social media, Egyptian data and tech services directory company ThruHQ said in a paper made public last month.

The analysis of more than 1,000 B2B companies found that almost 60 percent of businesses adhere to outdated online user experience design principles.

Almost 80 percent of B2B companies over-rely on paid advertising and neglect strategies such as content marketing, search engine optimisation, digital public relations and online communities.

Only 30 percent of companies have integrated artificial intelligence services into their offerings but Mahmoud Mashrqy, chief marketing officer at ThruHQ, says AI should not necessarily be a priority for Egyptian business.

“While AI is an exciting frontier and clearly on the radar, many businesses in Egypt still need to build foundational digital capabilities first,” Mashrqy said.

“The lack of consistent online visibility means missed opportunities for inbound business and credibility.”

ThruHQ estimates a total annual lost opportunity cost of $1.4 billion in unrealised software and IT exports due to this tech-averse approach to business.

OECD statistics bear out the findings. Egypt comes nowhere near to OECD country measures of internet access, share of businesses with a web presence, information and communications technology and services trade.

Egyptian businesses, particularly those wanting to sell overseas, would be better suited to focusing on “establishing a scalable web presence, digital sales channels and data-informed marketing systems,” Mashrqy said.

The IT sector’s contribution to Egypt’s economy sits at around 4 percent, said Nada Ihab, from the digital policy consultancy Access Partnership. That is far below the UAE’s 10 percent contribution.

“Key sectors like consumer and retail, infrastructure, resources and agriculture are particularly under-digitalised,” Ihab said.

She said a “trust gap” between consumers and businesses, driven by privacy issues and digital literacy, is a barrier to technology adoption.

Egypt has taken steps to improve digital trust such as promoting new data protection laws, but implementation remains patchy, Ihab said.

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Egypt’s “digital maturity” compared with other economies points to a deeper skills and leadership disconnect and means Egyptian companies are being outmanoeuvered.

Many of those businesses lack the necessary expertise or buy-in to prioritise digital transformation, meaning they are “vulnerable to competitors who are more digitally agile,” Ihab said.