Technology is set to play a significant role in helping merchants in the United Arab Emirates (UAE) reach and exceed their growth expectations; with many forecasting company growth in excess of 20 per cent this year. But are they ready for it?
Research released by the fintech Adyen revealed how UAE retailers are optimistic for growth in 2022, and how 84 per cent are expecting their businesses to grow by 20 per cent or more in 2022.
Last year, 73 per cent of UAE businesses grew in revenue by 20 per cent or more across the retail, food and beverage, and hospitality sectors, which is more than the 67 per cent growth witnessed on a global scale.
The fintech commissioned Opinium LLP to poll 1000 consumers and Censuswide to poll 200 businesses in the UAE, and economic modelling by the Centre for Economic Business Research (Cebr).
“Despite challenges as a result of the global pandemic, our research shows that UAE retailers have performed remarkably well compared to their global counterparts,” said Sander Maertens, head of Middle East for Adyen, whilst commenting on the findings of the research.
“Digital transformation and streamlined operations via improvements in online, in-app and in-store payments channels, along with supply chain and inventory management improvements, resulted in enhanced business performance, which drove up sales by 54 per cent.”
Tech translates to a better customer experience
Of many things, the research emphasises how a focus on digital transformation could help to facilitate retailers’ growth and customer loyalty.
When businesses incorporate technology across their functions, linking operations with payments and customer experience, the proportion of UAE businesses expecting to grow by 20 per cent or more increases to 84 per cent.
Additionally, accelerating digital transformation would add an extra 4.7 percentage points to the UAE’s retail sector’s growth rate over the next five years; according to Cebr’s economic modelling.
The majority of UAE consumers say they are more likely to shop with retailers that use technology to improve the customer experience.
In fact, 61 per cent of shoppers said they would be more loyal to retailers that let them buy things online and return them in-store.
The technology opportunity to improve operations and the customer experience is significant for retailers and something consumers have come to expect.
Ready to go?
The data shows that merchants are not fully ready to capitalise on the opportunity presented by technology integration in this specific instance. Only 23 per cent of UAE merchants allow customers to easily return items purchased online at their physical stores.
Although the UAE is at the forefront of innovation with 66 per cent having invested in digitising their operations, which is 20 per cent higher than the global average, there’s still room for improvement.
Customer expectations are higher in the UAE, with 86 per cent of consumers expecting businesses to use technology to make their loyalty programmes easier and more effective.
“UAE retailers are confident for future growth, but to keep the momentum going, they will have to deliver cohesive cross-channel payments experiences to their customers,” continues Maertens.