Saudi Arabia’s Entrepreneurial Space Boosted By Surge In Ramadan E-Commerce:
The surge in e-commerce during the holy month of Ramadan presents an ample opportunity for the entrepreneurship environment in Saudi Arabia. Despite the global price hikes and economic instability seen across the world, Saudi citizens were expected to spend more in Ramadan 2023 than they did in last year’s holy month, with online shopping being a significant contributor to this increase.
Delving Into Saudi’s E-commerce Space
To take advantage of this rise in customer demand, SMEs in the Kingdom have moved online and started using tools like social media to increase sales and reach more people. The Kingdom’s e-commerce boom, its good business structures, and its efforts to reach its Vision 2030 goals all help to speed up the expenditure growth caused by Ramadan.
According to a study by Toluna, consumer purchasing intentions in the Saudi market will increase 44 percent in Ramadan 2023 compared to a similar period in 2022 across all sectors. Toluna is a leading provider of market research and consumer insights. The report also found that residents intend to spend 35% more on vacation, 44% more on entertainment, and 51% more on groceries. This year, consumer shopping intentions increased by 42% for staycations, 39% for food delivery, and 31% for cosmetic services.
Toluna MEA Enterprise Account Director George Akkaoui observed that the company noticed an increase in spending intentions, with customers prioritizing purchases for food, clothing, and gifts for their loved ones. Also, a report published by Google and the leading market research company Kantar states that customers in the Kingdom have different buying habits during the holy month.
Companies in the Kingdom can make the most of the rise in customer demand by incorporating the holy month culture, taking advantage of the e-commerce trend, and using social media platforms. Businesses do better in the market when they pay attention to how customers shop during Ramadan and use that information in their business plans. Akkaoui also added that it is critical that brands understand the cultural significance of Ramadan and tailor their marketing activity accordingly.
Since the launching of the country’s Vision 2030 plan in 2016, its economy has greatly influenced its business environment, especially in the SME sector. It has changed and developed into an engine of growth for businesses. Reports showed that, at the end of June, there were 892,063 SMEs listed in the Kingdom. This is a rise of 25.6% from the 4th quarter of 2021.
Monsha’at, Saudi Arabia’s Small and Medium Enterprises General Authority, offers various entrepreneurial opportunities for SMEs to expand and succeed in the market. These opportunities include business incubators, business accelerators, and co-working spaces. The authority also provides government fee refunds, direct and indirect lending programs for SMEs, and fast-growing unicorns.
Businesses in the Kingdom are going online to meet consumer demand during Ramadan. This is a big opportunity for the economy of the country. Certainly, the business environment will help companies even more as the economy of the Kingdom continues to grow.