Cover Story: The growth of e-commerce in Qatar

Qatar is now the third biggest spender online in the Middle East. Barry Mansfield examines the factors driving this trend, and the main challenges faced by local and regional retailers as they strive to embrace the Internet age.


The Middle East experienced spectacular growth in e-commerce during 2011. Many new online launches took place in Jordan, Egypt, Lebanon and the Gulf nations and reports from the United Kingdom’s (UK) Interactive Media in Retail Group (IMRG), and Visa suggest that by 2015 the online retail market in the Gulf Cooperation Council (GCC) countries will have grown to US$15 billion (QR54.6 billion), up from US$3.3 billion (QR12 billion) in 2010.

The increasing availability of broadband, high speed download packet access (HSDPA) and WiMax Internet connectivity in the Arab world means that online sales are no longer a luxury for retailers: they are now a necessity – gone are the days of simply waiting for customers to walk through the front door to make a purchase.

For now, flight reservations and ticket sales account for the majority of transfers made online, but Internet users are increasingly comfortable purchasing textiles, household items and other consumer goods from the comfort of their living room. According to Euromonitor International, Qatar is now the third biggest online spender in the region, behind Saudi Arabia (an estimated US$800 million/QR2.9 billion for 2011) and the United Arab Emirates (more than US$2 billion/QR7.2 billion). A study conducted last year by Visa suggested that Qatar’s e-commerce volume was set to increase by 60 percent, with US$600 million (QR2.2 billion) in online transactions by the end of 2011 from the US$375 (QAR 1.4 billion) earned in 2010.

Not only that, but Visa believes the continuing upward trend will help to make Qatar the fastest growing information technology (IT) market in the Middle East and North Africa (MENA) region from 2011 to 2015. Qtel has already invested heavily in technology from Nokia Siemens Networks for a countrywide upgrade to its mobile broadband network (enabling download speeds of up to 14.4 Mbps, using HSDPA) in early 2010. As for online services, Visa has backed up its encouraging words with cash incentives designed to get Qataris shopping more online. Last June, for example, its campaign with Qatar Airways saw Visa debit and credit cardholders entered into a draw to win free flights and spending money – each time they made a card purchase.

Kamran Siddiqi, general manager for Visa Middle East, insists there “is still some way to go if e-commerce in Qatar and the wider region is to meet its full potential.” Likewise, Stephen Leeds, e-commerce business leader for Visa Middle East, has warned that online shopping in the region is “still in its infancy.” He fears that the industry is likely to be plagued by the security fears that have slowed uptake in other parts of the world. But Leeds still believes Qatar has all the right ingredients to enable e-commerce to “continue to grow, such as government commitment and retailer investment.”


These factors helped Qatar to become a regional mover in the United Nations’ 2011 e-readiness survey – where the country’s performance was slick in the e-government rankings, jumping from 62nd to 53rd place. The government first launched e-services in 2003; 24-hour access was available by 2010 with the revamped Hukoomi portal. E-commerce is part of the ambitious ICT-2015 strategy and the Malomatia initiative to develop local information communications and technology (ICT) talent.

Qatar’s e-Commerce law, enacted in April 2010, has also clarified vital business issues such as e-signatures, e-transactions, e-documentation and online authorisation. ictQATAR believes this law will enable Qatari businesses to become more innovative. Ahmad Al Kuwari, manager of ICT market Development, describes it as “a vital part of helping local businesses competing in the global marketplace.”

“More trustworthy sellers are coming online,” according to Samir Toukan, chief executive officer (CEO) of Jabbar Internet Group. “As we shop with new brands we have to look for sellers who provide certain certification, good customer service, good policies on fraud protection. But not all people will buy using credit cards. We see cash on delivery (COD) as a trend in our market. ”

Jabbar, which includes, and, has called on Aramex for help with warehousing facilities to store its inventory, customs clearance services to expedite the clearance of goods at the main borders, and payment options, including collection, billing and management for the COD service. Aramex is also the co-creator of an “e-freight” paperless cargo system, which will accelerate regional trade by enabling cargo operators, airlines and customs officials to exchange the required documents electronically.

But the real innovations in e-commerce, says Touken, are yet to come through. He believes social networking will transform online business in the Middle East: “The Arab world is a youth market, and Internet literate,” he points out. “As the young people become working citizens, they are more likely to buy online than the older population. We have seen a massive increase in users of Facebook and Twitter in the region. We will see more social shopping habits with the advent of virtual goods and multi-player games.”

Businesses are finding that usability, both for the end customer and the administrator of the website, is the key to rapid technology adoption. For example, when Priocept built a multilingual e-commerce Sitecore website for Virgin Mobile in Qatar, the development team determined that the Web Content Management (WCM) system should enable non-technical editors to manage the web experience. Administrative tools for financial reporting and order tracking were integrated into the management suite.

Priocept ensured that the website could deliver content to a broad range of device types and channels, including kiosks and Apple’s immensely popular iPad tablet. Then there is the brand-building ‘Experience Map’ – an animated, interactive, multimedia menu, which provides detailed information on forthcoming events in the region. Priocept spent five months building a critical sales and service channel for Virgin Mobile, which would go on to generate around QR9 million in sales in its first eight weeks of trading.

Qatar’s wider mobile sector has realised great benefits from initiatives of this type.  In a similar venture, Expansys’ e-commerce services subsidiary, PJ Media, supplied the official online store for Vodafone Qatar, and will soon be creating, launching and supporting the new site for Vodafone Turkey, using the expertise and bespoke intellectual property developed during the successful deployment in Doha.


Doha’s financial services sector is also increasingly confident in its ability to bring the world’s most advanced e-services to clients. In May 2012, Al Khalij Commercial Bank QSC launched a ‘state-of-the-art’ online banking service that looks radically different from earlier platforms. Robin McCall, the banking’s group CEO, says the goal is to enable up to 95 percent of in-branch transactions to be performed online, with fund transfers or credit card payments accounting for the bulk of this.

What really makes the Al Khalij service stand out, according to McCall, is its user interface, which “appears, and acts, like a modern smart application…as we decided that the traditional look and feel of typical online banking websites neither met our needs nor our brand.” Al Khalij consulted with the world’s top security experts to formulate what McCall describes as a “randomised virtual keyboard“ with “beneficiary activations,” but he claims the site’s most advanced security features are “located beneath the hood” so that most users will be unaware of and unhindered by the technology.


Qatari shoppers cannot find everything they want in Qatar itself, of course. In particular, they have a strong affinity for hard-to-find American labels, and now – thanks to - they have a package-forwarding service that can be used to safely and affordably ship items directly from the United States to the Middle East. According to, customers are purchasing everything from vacuum cleaners and auto parts to apparel and electronics and shipping them back to Qatar. John Wright,’s vice-president, reports that 2012 has seen 210 percent revenue growth in Qatar and a 150 percent growth in customers from 2011. The most popular stores are online traders Amazon and Ebay, followed by fashion giants like Gap, Nordstrom and Ralph Lauren.

In Wright’s view, Qataris are “more than comfortable” with the payment systems available to them now; he perceives them as extremely intelligent and brand-aware, savvy shoppers. But also offers personal shopping services for those who do not own a credit card or if their card is not accepted at a certain retailer; the company’s personal shoppers will use a corporate credit card issued in the US to buy the item if necessary.  “Language is probably the biggest obstacle,” adds Wright. “As we grow and are now offering support in additional languages, that barrier is slowing dissipating.”’s success may have helped to gloss over some of Qatar’s local weaknesses in e-commerce delivery, according to Kevin Gormand, CEO of classifieds website Mubawab, which now attracts over 600,000 unique users per month. “It is impossible to find technical local talent to develop good e-commerce websites in Qatar,” explains Gormand. This means entrepreneurs turn to cheaper consultants from the Asian subcontinent, with all the communication problems this entails, or expensive Western companies. “The high price of development or the poor quality of the sites make it hard to produce the working business model necessary for e-commerce websites, and this is why we see few local initiatives, and more global ones,” Gormand says.

Although Gormand fears the size of the market may also be a limitation, he is optimistic for the next five years, as he sees a boom ahead in mobile e-commerce, mobile payments and adapted platforms. “Mobile e-commerce is the future…but the telecom company would have to be part of the deal. People may not trust local websites, but they trust in their phone company, web apps and transactions over the phone. The very high penetration rate of smartphones in Qatar will make this option possible.”

This article first appeared in TheEDGE 34, June 2012.



You can be the first one to leave a comment.

Leave a Comment