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

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

The Kuwait E-commerce Market is expected to grow at a CAGR of above 14.28% 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 Kuwait to meet the growing demand for online retailing.

Key Highlights

• The COVID-19 crisis accelerated an expansion of e-commerce towards new firms, customers, and types of products. It has provided customers with access to a significant variety of products from the convenience and safety of their homes. It has enabled firms to continue operating despite contact restrictions and other confinement measures.
• Several factors are compelling the growth of the e-commerce market in Kuwait, such as high internet penetration, growing usage of 5G networks, increase online shopping, various e-commerce startups entering the country's e-commerce market, and other such factors.
• According to International Trade Administration, Kuwait has over four million Internet users. However, e-commerce remains predominately limited to online banking and financial brokerage services. As it stands today, most Kuwaiti companies do not conduct online business-to-business or business-to-consumer transactions.
• The Kuwait Government's e-Government website offers services for both enterprises and individuals. Based on the United Nations Commission on International Trade Law (UNCITRAL) regulations on electronic commerce, an electronic signature law has been authorized. Moreover, e-signatures are being used by some government organizations.
• Many organizations in e-commerce are entering Kuwait's market. For instance, in April 2022, Raha, an e-grocery platform, officially announced its launch in Kuwait's market. It is a fully automated e-grocery platform, offering a wide range of groceries, household essentials, and fresh produce. It also features Kuwait's first fully-automated robotics-fulfillment center and one of the first centers of its kind globally, with a chilled warehouse capability.

Key Market TrendsPenetration of Internet and Smartphone Usage

• The growing internet penetration and high demand for internet-related facilities and smartphones in Kuwait drive the e-commerce market. E-commerce requires high connectivity to the internet for payment and browsing services. The activity of users on smartphones with the involvement of different applications and the frequency of using them has increased the demand for smartphones, thus driving the growth of e-commerce in Kuwait.
• The rising use of internet and telecommunication services has opened new horizons for investors and organizations to invest in the region, which will further enhance the speed of internet services by reducing the time taken for online facilities like transactions and others. Many companies are looking forward to establishing mobile and internet services in the region. For instance, ASTtelco, the company owned by Ooredoo Telecom, launched innovative digital services in Kuwait and introduced new fiber-optic internet speeds of 200 Mbps within its fiber residential areas in the country.
• Telecommunication companies in the region are looking for strategic mergers and acquisitions to boost their presence in the Kuwait e-commerce market. For instance, in June 2021, Kalaam Telecom, a telecommunications provider, announced its acquisition of Zajil International Telecom, a Kuwaiti ISP and ICT services company. The acquisition will enhance the telecom company to expand into diverse e-commerce industries like retail, healthcare, and education.
• The government is also taking various steps in order to boost the country's digital infrastructure, which will help increase e-commerce sales in the country. The 'New Kuwait' Kuwait Vision 2035 is in line with the deployment of 5G for smartphones, which intends to accelerate digital advancement to attract foreign investment and establish the groundwork for a sustainable economy, and stimulate domestic growth in the country.
• Several companies in the region are looking for a partnership to boost their 5G services for smartphones using high-speed internet. For instance, in January 2022, Zain Kuwait announced its partnership with Ericsson for the commercial launch of 5G Standalone (SA) charging services in Kuwait. Ericsson Business Support System (BSS) will provide the company with increased efficiency and reduction in time-to-market while launching 5G Standalone charging services. The partnership is in line with the company's vision for future digitalization developments.

Growing Demand from the Fashion Industry

• The growth in household consumption and fashion trends drives fashion segment growth in the Kuwait e-commerce market. Many major market players go for digital promotion through social media sites like Instagram to attract more customers. Furthermore, the ongoing Digital transformation will enable new business in Kuwait.
• With increased customer demand for premium products, luxury brands from across the world are stepping into the Kuwait e-commerce market. For instance, in March 2021, OffWhite, an Italian luxury fashion label, announced the launch of its store at Avenues Mall in Kuwait City.
• The usage of social networks is very high in Kuwait across all ages – even among older people. People use social networks for a mix of social and informational purposes. Among informative activities, receiving news and information ranks highest, which is followed by exploring various links on social networks to get users to external web pages. The external links reaching the various e-commerce websites attract the customers to visit the sites again to buy their products.
• Various e-retail stores are launched in the region because of the growing demand in the e-commerce market. For instance, In January 2021, Lacoste, a French retail company, introduced its online shop in Kuwait. The online shop promises free delivery within 48 hours. Furthermore, the online store will offer a wide range of products in different categories such as shoes, apparel, leather goods, and accessories with the full range of Lacoste collections.

Competitive Landscape

Kuwait's e-commerce market is witnessing a rise in competitiveness among companies. The market consists of various major players, such as 6th Street, Ubuy, H&M, and others. In terms of market share, these significant players are presently dominating the e-commerce market in Kuwait. However, with increasing innovations in e-commerce, many companies are increasing their market presence by securing new contracts and tapping new markets.

• January 2021 - Boohoo, British Online Fashion Retailer, has announced a partnership with Kuwait-based Alshaya Group to build its Debenhams brand in the Middle East region.
• May 2022 - Fiz, an grocery delivery e-commerce startup, secured an investment of secured USD 2.5 million for introducing its grocery delivery platform.

Additional Benefits:

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

Please note: This publisher does offer titles that are created upon receipt of order. If you are purchasing a PDF Email Delivery option above, the report will take approximately 2 business days to prepare and deliver.