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Think local: the best weapon in the fight to topple an e-commerce giant

A Mena startup can outwit a global behemoth if it uses its insider knowledge of its customers

Online shopping with a credit card. Tabby and other local businesses offer alternative payment methods Pexels/PNW Production
Online shopping with a credit card. Tabby and other local businesses offer alternative payment methods

What do Alibaba and Grab have in common? These businesses have thrived in the world’s most competitive e-commerce landscapes, outmanoeuvring global competitors to dominate their respective home markets.

The stories of Alibaba edging eBay out of China and Grab overtaking Uber in Southeast Asia demonstrate how local startups can triumph over global giants.

A similar trend is unfolding in the Middle East’s e-commerce sector. Manara Global research has found that more than 60 percent of UAE residents have used the Dubai-based channel Noon for shopping in the past month, equalling Amazon’s reach – an impressive feat for a company less than a decade old.

Another Dubai business, Careem, has become the region’s “everything app”, outnumbering the combined user base of all other similar apps by 28 percent.

The key to these startups’ success lies in their localisation strategy. This touches every aspect of their operations, from product design to talent acquisition. As the e-commerce market in the Middle East continues to grow, embracing and maintaining a focus on localisation is proving crucial.

What is localisation?

Localisation in e-commerce involves customising aspects of a business, including products, payment options, customer service, website interface and marketing campaigns, to suit the preferences and cultures of different geographic regions or target audiences.

In the Middle East, localisation means adapting operations to cater to the tastes, languages (such as Arabic), payment preferences and cultural sensitivities of the region, thereby improving customer engagement, trust and, ultimately, sales. 

A good example is Tabby, a $1.5 billion Dubai-founded, Riyadh-headquartered business that offers buy now, pay later services to online shoppers. Recognising that a significant portion of consumers in the region either do not have access to traditional credit cards or prefer not to use them online, it provides alternative payment mechanisms.

Tabby’s service is integrated with popular e-commerce platforms such as Noon, improving the shopping experience for users and boosting conversion rates for merchants. By localising payment options, Tabby addresses a critical barrier to online shopping in the region, increasing engagement for millions of consumers. 

In Middle East and North African countries outside the GCC, the lack of a robust credit system limits financing options for small merchants. Startups have developed localised solutions targeting this niche yet important market. 

The future will be shaped not just by the products offered but by the people behind them

MNT-Halan, a Cairo-based microlender and Egypt’s highest valued startup, uses sophisticated algorithms to assess the creditworthiness of its users. Unlike traditional banks, which rely on credit histories and collateral, its technology enables the analysis of data such as mobile phone usage patterns, transaction histories and even social media activity.

This allows MNT-Halan to extend credit to individuals and small businesses that lack formal credit histories, widening its customer base and improving financial inclusion in Egypt. 

The battle for talent

Both MNT-Halan and Tabby were founded by local entrepreneurs, respectively Mounir Nakhla and Hosam Arab. Careem and Tamara, another Gulf buy now, pay later platform, were set up by business people with local roots.

These entrepreneurs are uniquely positioned to grasp the subtleties of the local market. However, the potential emergence of a Middle Eastern equivalent to Jack Ma, billionaire founder of Alibaba Group, depends not just on visionary founders but also on the recruitment of skilled and talented lieutenants.

It is crucial to attract local talent, particularly those with strong technical expertise in science, technology, engineering and mathematics as well as an understanding of local nuances and global trends.

The competition for such talent is fierce. Those with similar qualifications are highly sought after by global tech giants such as Facebook, Google and Amazon.

E-commerce contenders in the Middle East must offer compelling compensation packages and clear career advancement opportunities. For those lacking the financial resources, conveying a persuasive vision becomes essential.

The battle for talent reflects a broader narrative: the future of e-commerce in the region will be shaped not just by the products offered but by the people behind these innovations. The fusion of localisation strategies with the cultivation of local talent appears to be the key for thriving.

Dawei Wang is head of editorial and insights at Manara Global, a strategic communications consultancy in Dubai and Abu Dhabi

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