image: Noon

image: Noon

“In Saudi Arabia, a kingdom where postal codes are rarely used, most people pay in cash, and shopping is done in giant air-conditioned malls, building an online retail business is no easy task,” per Reuters. And yet, the e-commerce sector in the United Arab Emirates has been rapidly growing, with mergers and acquisitions, in particular, over the past year, with investors looks to tap into the region’s huge population of affluent and digitally savvy individuals. and are two of the biggest names making a play to win over Middle Eastern consumers on the web, and they are both “well-armed for the fight.” The New Guy

Originally slated to launch early this year, debuted in the United Arab Emirates this month, and has swiftly announced its plans to enter the Saudi market “within the coming weeks.” The $1 billion project has been spearheaded by Dubai billionaire Mohamed Alabbar – whose firm Emaar Properties, one of the largest real estate development companies in the world with annual revenue of $4.2 billion and a market cap of over $20 billion, is known for developing the world’s largest mall Dubai Mall – and the Public Investment Fund of Saudi Arabia.

Looking to dominate the region’s rapidly changing retail landscape and take on the likes of Amazon, – which has both English and Arabic language capabilities – is currently offering electronics, garments and accessories, home and kitchen goods, beauty and fragrance products, baby products and grocery.

In terms of its fashion-related offerings, Noon, which boasts a visually appealing fashion channel, stocks brand ranging from Elisabetta Franchi, whose jackets are selling for AED 5,360.00 ($1459.30), and Meena – with its AED 4,000.00 ($1089.00) dresses – to Mango, Forever 21, and Nike. In the beauty department, it stocks a significant array of Dior, Chanel, Nars, Tom Ford, and Gucci products. 

Early this month, Alabbar said of’s launch: “We are proud to take this important first step in our journey, and we are committed to making Noon the region’s Arabic-first e-commerce platform.” He further added: “As digital technologies cause disruptions across industries and geographies, it is important for us to shape a digital marketplace that is relevant to our local markets and serves as a growth platform for brick-and-mortar retailers.”

While Alabbar – who maintains a 40 percent of a $153 million joint venture with Yoox Net-a-Porter in order to bring the Milan-based online luxury fashion retailer to the Middle East next year, in addition to a 4 percent stake in YNAP, itself – clearly has luxury intentions, they have not translated into … yet. In the meantime, Alabbar brings to the table “expertise of local retail – such knowledge was key to Alibaba’s success in China versus giants such as eBay,” according to Ayub Ansari, a senior analyst at Bahrain’s Securities & Investment Company.

It is unclear exactly how many products are being offered on the – which is headquartered in Riyadh and headed up by CEO Faraz Khalid, the co-founder of online fashion retailer (which is backed by Rocket Internet) – Alabbar said that the site would launch with up to 20 million products, roughly half of Amazon’s 40 million products. The Big Guy

The other major player angling for (and ultimately landing) the title of the “Amazon of the Middle East”: The English-Arabic language e-commerce platform, which was founded in 2005 by Syrian entrepreneur Ronaldo Mouchawar, made headlines after it landed $275 million in funding this February, primarily from previous investors Tiger Global – American investor Chase Coleman’s New York-based hedge fund – and Naspers, a Cape Town, South Africa-based multinational internet and media group.

Mouchawar said that round of funding – which gave Souq a valuation of upwards of $1 billion and marked the Arab world’s largest ever funding deal and made the e-commerce giant the region’s first unicorn – “will be used to drive further growth by investing in technology, scaling our marketplace operations, launching new product categories and recruiting the best talent.”

A month later, in March 2017, Alabbar’s Emaar Properties made a play for Souq, offering up $800 million, but was beat out by Seattle, Washington-based Inc., which confirmed that same month that it would be acquire for an unknown value. While the value of the deal – which expected to be fully finalized this year – was initially unknown, an Amazon filing with the U.S. Securities and Exchange Commission revealed that it has paid $580 million.

“Amazon and Souq share the same DNA. We’re driven by customers, invention and long-term thinking,” said Amazon senior vice-president Russ Grandinetti when the news of the deal broke.

Souq chief executive and founder Mouchawar said: “We are guided by many of the same principles as Amazon, and this acquisition is a critical next step in growing our e-commerce presence on behalf of customers across the region.”

As of March, Souq boasted over 8.4 million product listings in 31 categories, including “consumer electronics, fashion, health and beauty, household goods and baby,” per BBC. The British news outlet further stated that Souq brings in approximately 45 million visits per month, making it the largest e-commerce platform in the Arab world, with operations in United Arab Emirates, Saudi Arabia, Kuwait, Egypt, Bahrain, Oman, and Qatar.

Within its “Souq Fashion” channel on the site, the e-commerce giant is offering a small selection of handbags from Bottega Veneta, Salvatore Ferragamo, Marc Jacobs, and Prada, Burberry jewelry, French Connection garments, and Coach-logoed footwear. (Given the small selection of products per brand, however, it is unclear the extent to which the brands have authorized such sales).

In terms of cosmetics and fragrances, Viktor & Rolf, Dior, Dolce & Gabbana, and Tom Ford, are amongst the offerings. 

In addition to have some higher fashion brands on its side, and Amazon on speed dial, Souq has also been able to grow quickly “because of how it has tailored its platform to work on mobile devices. As with other emerging markets, smartphones are far and away the most common way for consumers to go online,” Mouchawar told TechCrunch last February. The Luxurious One

And not to be overlooked in the smaller but still very noteworthy, the region’s first dedicated luxury e-commerce platform. Launched in December 2016, Ounass is the brainchild of the Al Tayer Group, the Dubai-based holding company, with a portfolio of ventures ranging from automotive and industry to retail.

As the Middle Eastern licensee for Dolce and Gabbana, Alexander McQueen and Giorgio Armani, among others, Khalid Al Tayer’s venture is uniquely situated to be the force of luxury in the region. With that in mind, it is only reasonable that Ounass, which boasts the title of “the definitive home of luxury,” stocks brands including Gucci, Prada, Miu Miu, Valentino, and Oscar de la Renta, among many others.


Analysts are firmly putting their money on Souq in the battle between the two giants for a number of reasons. “For the first two years at least, we do not see creating the buzz expected,” Hassan Munir, chief creative officer at a Dubai-based marketing and advertising company ExtraCake P.R.A told Reuters. Mr. Munir suggests that Alabbar may not have adequately gauged how difificult such a venture will be, saying: Alabbar “not only took it as being an easy task, but he also triggered a debate by his own retailers, who frankly, at this point, are not doing so well in the market.”

Nabil Alnoor Borhanu, president of venture capital firm Graphene Ventures, is less concerned with Alabbar’s ability than he is with the Souq’s ties to Amazon. “Even for retailers with bigger regional experience (than Alabbar) like Alshaya in Kuwait or Alhokair in Saudi Arabia for example, Amazon has a larger leverage simply because it looks at the whole globe.” He further noted, “Amazon has access to a global supply chain that runs the whole way from East to West, from China to New York, and that is why I think Noon does not have any leverage over Amazon.”

Regardless of which site is slated to take the cake in terms of popularity amongst consumers – and thus, profitability – over the next several years, and whether Noon will truly be able to compete with the Amazon-backed Souq, together – along with luxury-specific Ounass – they are making waves in the Middle East.

The impending shift from brick-and-mortar shopping to e-commerce – as seen in the efforts by both Souq and Noon, but also an increasing number of Arab businesses and international luxury brands, alike – will represent a marked “sea change for commerce in the Middle East, where internet sales now represent less than two percent of total retail, twelve times less than in the United Kingdom,” according to a Boston Consulting Group report.

“We’re turning the e-commerce environment in [the] Middle East upside down,” Alabbar said earlier this year.