Chinese Companies Making Waves in the Middle East E-Commerce Market
The Middle East has emerged as a new frontier for e-commerce, drawing significant attention from Chinese companies eager to expand their global presence. With a young, tech-savvy population and high spending power, the region offers a promising market for Chinese e-commerce giants.
Exploring New Opportunities in the Middle East
Xu Jin, a talent scout for a Chinese MCN (multi-channel network) company, has been actively seeking potential influencers in Dubai’s bustling commercial areas. His job is to find promising individuals who can become TikTok influencers and drive e-commerce sales. Xu and his team have managed to generate $100,000 in monthly revenue by tapping into the Middle Eastern market according to TMT Post.
“The Middle East is an emerging market with great potential. There’s plenty of traffic and money, but it lacks influencers who speak Arabic and can engage with the audience,” says Xu Jin. His company is one of many Chinese enterprises recognizing the opportunities in the Middle East following the success seen in Southeast Asia.
Middle Eastern E-Commerce Landscape
Saudi Arabia, with a population of approximately 37 million, boasts a high internet penetration rate expected to reach 96.44% by the end of the year.
The government plans to invest over $100 billion in developing logistics infrastructure and online payment systems to boost e-commerce growth. The region’s demographic, with a significant proportion of young women, has strong purchasing power comparable to that of the US.
Licensing, an operator of an MCN team in the Middle East, highlights the unique challenges and opportunities in the region.
Unlike China, where influencers are well-versed in e-commerce, Middle Eastern influencers often lack experience, requiring MCN companies to provide comprehensive support, including product selection, sourcing, and logistics.
Challenges and Adaptations
Operating in the Middle East comes with its own set of challenges. Licensing recalls an incident where a live-streaming session with an Arabic-speaking female influencer faced numerous hurdles due to cultural differences and the influencer’s lack of experience.
The live session, aimed at driving sales, struggled as the influencer did not allow any assistance during the broadcast, making it difficult to manage the show.
The cultural and logistical differences necessitate a tailored approach to influencer marketing in the Middle East. Chinese MCN companies are finding that strategies successful in other regions, such as focusing on entertainment to drive traffic, may not directly translate to the Middle Eastern market.
Successful Strategies and Product Selection
To succeed, Xu Jin’s team had to adapt their product selection to local preferences. Initially, they struggled with low-margin household items, but a shift to high-demand products like headscarves, which are significant in local culture, proved profitable.
Understanding the cultural significance and consumer preferences in the region is key to driving sales.
Mother and baby products also found a strong market due to Saudi Arabia’s family-friendly policies, including support for multiple marriages and substantial state-provided benefits for children.
Products like children’s toys, baby care items, and children’s clothing, marketed by female influencers, saw high demand and repeat purchases.