Bahrain E-commerce Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Bahrain E-commerce Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Bahrain e-commerce market is expected to register a CAGR of above 14.48% during the forecast period, 2022-2027. The e-commerce industry is growing exponentially as more e-commerce businesses step into the country. The digital economy is significantly developing with access to the internet made available across the globe. Various e-commerce market vendors are expanding their business in the Bahrain Market to meet the growing demand for online retailing.

Key Highlights

• E-commerce (electronic commerce) purchases and sells products and services over an electronic network, typically the internet. Business-to-business (B2B), business-to-consumer (B2C), consumer-to-consumer, and consumer-to-business transactions are all possible. E-commerce is witnessing rapid growth in the Bahrain market. The factors like internet penetration, rise in the tech-savvy youth population, and other factors are driving Bahrain's e-commerce market.
• Widespread smartphone and tablet usage have made social media applications such as WhatsApp, YouTube, Facebook, and Instagram popular platforms for advertising, retail, delivery, and other commercial services.
• Similarly, In October 2021, The Central Bank of Bahrain (CBB) introduced electronic cheques (e-Cheques). This initiative was taken to promote the ongoing efforts toward digital transformation. Furthermore, The CBB directed the BENEFIT Company (BENEFIT) to implement the Bahrain Electronic Cheque System (BECS), leveraging the latest technology, to provide e-Cheque services.
• Moreover, brand acquisitions are taking place in the country to meet the growing demand for e-commerce. For instance, In February 2022, MySize, the provider of AI-driven measurement solutions, announced the acquisition of Orgad, an omnichannel e-commerce platform. The acquisition will help MySize accelerate its revenue growth and reduction costs for its business clients.
• Due to the covid - 19 regulations and the shutdown of various industries, the Bahrain government took some measures for customer engagement by introducing online shopping and a virtual marketplace to support the growth and development of owner-operated micro-businesses engaged in online sales activities, such as trading, merchandising, and retail. For instance, In 2021, the Ministry of Industry, Commerce, and Tourism (MoICT) has permitted 100% foreign ownership of businesses that provide online retailing in Bahrain.

Key Market TrendsSignificant Growth in E-Commerce is Expected due to Digital Transformation

• During the COVID-19 pandemic, the Bahrain Government's priority was to ensure the continuity of services and ramp up its infrastructure and security to enable Work From Home, e-Learning, e-Banking, and e-Health initiatives. The use of digital workspace, healthcare, and other related platforms positively affects Bahrain's e-commerce market.
• Bahrain's government is launching various initiatives to strengthen the country's digital economy. The Digital Government Strategy 2022 aims to develop the digital infrastructure strategically. This strategy will focus on Strengthening digital infrastructure, data, and artificial intelligence, Accelerating the transformation and collaboration efforts of various public sector entities, Strengthening accountability, transparency, and civic engagement through open data and e-Participation, and encouraging innovation and nurturing entrepreneurship.
• Start-ups are accelerating the growth of Bahrain's e-commerce market. According to the World Trade Organisation, in July 2021, 24 accelerators and incubators have been authorized to incubate 761 start-up businesses in different fields such as IoT, technology, fintech, e-commerce, media, creative industry, and medical.
• Many financial service vendors are entering the e-commerce market in Bahrain to ease the payment options for customers. For instance, In May 2022, Tabby, a provider of Book Now Pay Later(BNPL), announced its partnership with Visa, financial services corporation, and M2P FinTech, an API infrastructure company, to make in-store payments easier with the availability of Tabby Visa Card.
• In February 2022, Mastercard announced its partnership with Payment International Enterprise to launch a digital program, Flooss, that will provide financial services in the Bahrain e-commerce market. This payment service will also offer an app through which the customers can make payments and add reminders for payments that are due.

Fashion is Expected to Hold a Major Share

• The fashion industry has recorded growth during the COVID-19 outbreak because customer preferences shifted towards online shopping with easy access to different websites, eliminating the need to visit physical stores. Several factors have boosted the demand for online shopping and retailing, such as the rise in users of social media and smartphones.
• Many e-commerce vendors are launching their online sites in order to meet the online shopping demands of buyers. For instance, In February 2022 - Youapp, a last-mile company, will be launching its multi-vertical delivery platform in Bahrain. This app will provide Fashion, Health & Beauty, Food & beverages, Lifestyle, Grocery, and Flowers.
• Similarly, In July 2021, Boohoo, a British online fashion retailer, announced its partnership with Kuwait-based Alshaya Group for building its Debenhams brand in the Middle-East region, including the Bahrain market.
• The rise in online shopping and work from home has driven the use of the internet for meeting home delivery across the customers. For instance, in May 2021, Sitecore, a software company, stated in their report that 86% of customers in Bahrain have switched to digital since the pandemic and want to continue purchasing everything online.

Competitive Landscape

Bahrain's e-commerce market is witnessing a rise in competitiveness among companies. The market consists of various major players, such as Alibaba, Amazon, eBay, and others. In terms of market share, these significant players are presently dominating the e-commerce market in Bahrain. However, with increasing innovations in e-commerce, many companies and startups are increasing their market presence by securing new contracts and tapping new markets.

• In March 2022 - LuLu Group announced the launch of its LuLu Express Fresh Market in Bahrain. The Express fresh market is completely run by women. The market has bakery products, fruits, vegetables, and other food products. The market offers branded, imported products and regional offerings.
• January 2022 - Batelco, a telecom services provider based in Bahrain, recently debuted Batelco eSuite, its eCommerce platform, to help sellers create an online store easily. It will also provide a completely customizable solution with localized payment methods.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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