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Situated on the Persian Gulf, next to the Gulf of Oman, the city of Dubai is a renowned global city whose importance to the global economy is almost unparalleled. Because of its strategic position, actively-diversifying economy, and excellent trade relations and prestige, Dubai is an excellent location for any businesses looking to expand or invest, especially into Middle Eastern, North African, and Central and South Asian markets, or anyone looking to do business in the Middle East region.
The Arab consumer is unique and needs to be treated differently than consumers in other parts of the world. Below we will examine some of the consumer behavior, traits, characteristics and demographics of a Middle Eastern Arab consumer that set them apart from consumers in other parts of the world. It should be noted that many of these points are broad generalizations with the intent to help inform businesses looking to operate in the region on how they can better reach their target audience. Since these are broad generalizations about Arab consumers there will always be exceptions to these traits that defy the norm.
Despite the opulent wealth in many of the Gulf countries, payment methods in the Arab world are still catching up to what they are in many western countries. Many Middle Eastern countries have typically been cash-based societies and the use of credit cards has been a relatively new thing in the region. To add to this laws about interest in the Quran and the Hadith have made it hard for many interest-based payment methods to take hold in the region because they are considered to be against the practices of Islam. In this article I will outline some of the payment methods that are available in the region.
Cash on delivery is probably the most popular payment method in the region. Because of the lack of credit cards in the region cash on delivery has gained popularity as an online payment method among locals. Cash on delivery is also a payment method that allows consumers to see the products they buy online before they actually pay for them. Due to this fact many online retailers in the region say that cash on delivery has a return rate much much higher than any other payment methods. We have seen statistics that say anywhere from 12 to 13 times the number of returns happen with cash on delivery when compared to credit cards. Consumers receive the package open it and often times say they don’t want it and return it immediately. As you can imagine this can be very costly for the e-commerce merchant as they have to pay the delivery cost without receiving any type of reimbursement. This issue has made it so some retailers in the region have chosen not to use cash on delivery, especially when the e-commerce merchant is just getting started.
When seeking to target any region of the world online it is a good idea to have an understanding of which regional search engines you need to target. This is no different when targeting countries in the Middle East. Unlike many other regions in the world the Middle East does not have an alternative to Google that dominates the region. Despite this there are some important observations to make about Middle East Search Engines that we will go into more detail about here.