Onlife consumers are everywhere

Aug 5, 2019Blog, Int. Appearances

It is hard to overestimate the impact of the internet on retail. When being online was new, the retail business model did not have to adapt, not much. Buyers, retailers, consumers, same old story. In many ways, the webstore was simply a digital storefront, with a department store behind it. Not so today. The here (analogue, offline) and there (digital, online) is merging to become one onlife experience. This is a phenomenon called ‘onlification’. Society as a whole and retail in particular have undergone an immense transformation. The new normal, being onlife. Every aspect of life has changed, from online banking, or using social media, sending emails on a smartphone, booking a ride-share app, checking Google Maps for an address, and so on. Consumers are online all the time, wherever they go, on various devices.

The MENA region is going through onlification, too. According to a 2018 report by Bain & Company (in partnership with Google), retail in this region is on the verge of a pivotal shift. In other regions, going digital happened gradually, consumers first, then businesses. Not so in MENA, where mass adoption of internet has been swift and grown exponentially. Driven by smartphones, social media and faster internet speeds, consumers were largely online by the mid-2000s, with the GCC countries leading the way. The shift has been dramatic: the share of digital media across the region increased from 10% in 2012 to over 30% by 2017.

Transformation the name of the game

In my book The End of Online Shopping, I describe several trends that transform the retail business. To name just three:

• Online and offline become one: stores and services providers will become connected stores, serving as places of inspiration, experience and service. Consumers can use apps and smart store concepts, allowing them to have a fully onlife retail experience, whenever and wherever.
• Diversification in retail: Retailers now offer services, too, and service providers no longer shy away from selling actual goods. Amazon, Alibaba and Souq are examples of companies that sell an almost infinite array of goods. Diversification makes room for new market entrants to grab opportunities in niches and catch established businesses off guard.
• Channels flowing together: the distinction between B2C (business to consumer) and B2B (business to business) is likely to disappear, with everyone selling to everyone else. Consumers can sell to consumers and retailers broaden their focus to includes businesses. 

The future of retail

Patrick Chalhoub, CEO of Chalhoub Group, was spot on when he said: “This is not about digital transformation, it is about transformation, period.” New business models and new customer experiences are on the horizon. TJ Lightwala, of Mindshare MENA, says changes are significant because these countries traditionally favoured a more physical retail experience. Until recently, consumers were sceptical of online payments. Large tech companies joining the game and the increase in webstores for electronics and clothing have paved the way for change. Amazon acquired Souq, the region’s largest online retailer, in 2017 for $580 million. That same year, Mohammad Allabar launched noon, a new e-commerce venture that has since joined forces with eBay. What’s next? To be sure, more disruptions and more options for the savvy onlife MENA consumer.

As a preparation for my upcoming trip to the OEC2019 | Sept 16th & 17th | Muscat- Oman |, I wrote a series of blogs were I shed a light on the evolving process of onlification in the Middle East. This is the first blog in a series of three.



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