News
Trending

Over 1/3 of merchants in Saudi make the shift to eCommerce offerings amid COVID-19

Follow Asdaf News on

Riyadh – :

Visa, the world’s leader in digital payments, in collaboration with the Social Development Bank (SDB), has launched its regional “Where You Shop Matters’ initiative that aims to champion and enable entrepreneurs while encouraging consumers to support small businesses in Saudi Arabia. As part of this initiative, Visa has published the COVID-19 CEMEA Impact Tracker highlighting the recent effect the novel coronavirus pandemic has had on commerce for consumers and small merchants in the Kingdom.

Launching this week, ‘Where You Shop Matters’ will help support small businesses through the Visa Small Business Hub, a merchant platform providing tools and information on how to start, run and grow small businesses. The Hub will also feature leading merchants who embody the passion and entrepreneurial spirit of small businesses across the Kingdom.

The findings of the report highlight increased anxiety amongst merchants in KSA with 67% of small businesses noticing a decrease in average consumer spending during COVID-19. As consumers in KSA stay away from all but essential retail, the impact of the pandemic on merchant revenues has been high with 93% of those surveyed stating revenues have been negatively impacted.

During the pandemic, many consumers in Saudi have started shopping online for the first time, primarily for essentials. Two-thirds of Saudi consumers (66%) surveyed say that COVID-19 has led to their first online grocery purchase, while 59% have made their first online purchase from pharmacies. Overall, the report points to a shift to online commerce, with cash transactions being replaced by digital payments.

The study also found current conditions have served as a catalyst for online commerce with 38% of merchants in KSA reporting they have introduced online offerings as a direct result of the pandemic while more than half (57%) had an eCommerce presence before the pandemic. As consumers and merchants focus on safety and hygiene, the use of contactless payments has also increased during the crisis with merchants expecting a further 28% growth post COVID-19.

Commenting on the report’s findings, Ali Bailoun, Visa’s General Manager for Saudi Arabia, said: “The pandemic is impacting businesses everywhere. The findings of the COVID-19 CEMEA Impact Tracker suggest shoppers have changed how they shop, and this is already having a major impact on how merchants do business. As consumers adapt to the current restrictions, many have turned to online outlets for their shopping. These changes present challenges but also enormous opportunities for all merchants, including small businesses.”

According to the report, 54% of consumers admit to now spending less while also changing their shopping habits. Asked about spending habits, consumers in KSA are increasingly optimizing their trips – (54%) buying in bulk, (48%) making lists to avoid impulsive purchases, and (48%) buying non-perishable items to ensure fewer trips. When shopping in-store, 84% of the consumers are cautious about hygiene while 68% avoid rush hours.

“This report shows how cash-only retailers were most negatively impacted while merchants who moved online and adopted contactless payment systems have been able to better weather the adversity. It is vital that merchants across the globe understand the shift in consumer behavior and adapt accordingly. eCommerce and digital payments are here to stay and the way forward for small businesses,” Bailoun added.

On this occasion, Eng. Muied Al-Bishi, the Head of Strategy at the Social Development Bank, said: “Since the outbreak of the pandemic, the bank has launched a series of initiatives totaling 12 billion riyals to support and empower small and emerging enterprises. This comes as part of the government endeavors to mitigate the financial and economic impact of the pandemic. This campaign with Visa represents as a continuation of the bank’s efforts to support small and emerging enterprises to enable them access to digital tools and solutions, thereby helping contribute to the growth and sustainability of their business. We are confident that, together, we will continue to create opportunities that will help small and emerging enterprises take advantage of the rapid growth of digital payments adoption by customers in the Kingdom, and- consequently- help stimulate this vital sector of the national economy.”

Speaking on the launch of Where You Shop Matters, Madhur Mehra, MENA Head of Merchant Sales & Acquiring, Visa, added: “At Visa, we are proud to support merchants and recognize that many small businesses have been most adversely affected by the pandemic. From eCommerce to security, our ‘Where You Shop Matters’ initiative aims to help support and empower local small businesses that serve as the backbone of our communities.”

 As part of the campaign, Visa will run several activations including masterclasses and webinars for small business owners in Saudi, sharing useful insights and tips that are critical to helping them optimize and adapt their business models for now and beyond COVID-19.

Visa will also be working to support key small businesses across the Kingdom as part of the initiative, including Macros and Byhjn. For more details on Visa’s ‘Where You Shop Matters’ campaign, or to find out how you can support a small business near you visit the website here.

About the Visa’s COVID-19 CEMEA Impact Tracker: To understand the needs of small businesses, Visa conducted a survey to assess how consumers and merchants are adapting to COVID-19. The survey was conducted across the UAE, KSA, Russia, Ukraine, South Africa, Nigeria, and Kenya. The methodology consisted of a combination of online, telephonic, and offline interviews with consumers and merchants across key segments from groceries to fashion and travel.

Show More

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button