The growth of e-commerce uptake in Egypt provides a valuable opportunity for the country’s startups and multinational corporations looking to operate within the MENA region.
E-commerce is expanding rapidly in developing countries, and with a youthful and skilled population, Egypt is quickly emerging as North Africa’s hub for e-commerce. Growing numbers of multinational corporations are choosing to relocate their tech-houses to Egypt, taking advantage of growing internet penetration rates, and public initiatives to support online trading.
Following intensive investment in the 1980s, Egypt developed a strong IT infrastructure, creating an environment that was prepared to support the telecommunications and e-commerce industries. In the 1990s, telemarketing was first introduced to the Egyptian market, enabling businesses to process telephone orders across the country. By the year 2000 retail growth was accelerated further with the launch of satellite ads; many businesses adopted the new medium as a means to expand their reach, whilst also introducing a wider range of products to the marketplace.
Today, after decades of investment, the e-commerce sector is widely regarded as one of the most dynamic and fastest-growing sectors in the country. Egypt’s youthful population, with a median age of just 24, equips the country with a huge potential for exponential growth. With 54 million inhabitants under the age of 25, there exists a remarkable potential to enhance growth by utilising the country’s most valuable resource.
Sameh Shaheen, Aramex’s Head of Commercial in Egypt, observes that most of the e-commerce adoption is coming from Egypt’s 15-45 age group, a sign that the country’s youth are vital to driving growth within digital sectors. “Global giants are increasingly moving their tech houses into Egypt, attracted by our young population who are equipped in soft skills.”
Internet penetration in the country exceeded 57% of the population during the peak of the pandemic in 2020, a substantial increase from 2015’s rate of 37%. As the MENA region’s largest Arabic speaking population; the figures show that Egypt’s e-commerce potential is huge.
Sameh remarks on Egypt’s ability to leverage its strengths in developing the e-commerce sector; “The infrastructure of the country is facilitating e-commerce growth.
The COVID-19 pandemic introduced millions of users to the world of online; forcing traders, courier and logistics companies as well as the regulators to accelerate the roll-out of many future plans to cater for the market demands.”
Reliance on cash-only transactions is also retracting year-on-year and the volume of prepaid orders is equivalent to almost of 30% of today’s orders in Egypt. Public initiatives to boost financial inclusiveness for a wider range of the population support the stretching of e-commerce to the maximum.
Growing numbers of businesses entering the e-commerce space has led to a shift in demand for quality customer experience. Increasingly, consumers are choosing to shop online with businesses who prioritise streamlined service, quick delivery times, convenient payment solutions and a seamless order tracking. Nowadays, there is a growing expectation for delivery companies to handle complaints and deal with customer service enquiries; aspects of deliveries that traditionally logistics companies weren’t expected to deal with in the past. Fortunately, for leading logistics and transportation companies such as Aramex, customer service has long been a priority. In recent years the company has enhanced the level of service by implementing parcel tracking, WhatsApp chat bots and more.
Aramex’s resources have also provided a huge level of support to businesses of varying sizes in Egypt. With a fleet totalling 1,500 drivers, 54 convenient pickup locations, and a fulfilment centre spanning 100,000sqm; the company has the means to support a rapidly growing Egyptian e-commerce sector. Aramex also continues to pioneer innovative methods of increasing its resources, and through the introduction of Aramex fleet, the company has enhanced its fleet by an additional 900 individuals who are able to support last mile delivery outside of their day jobs. Aramex continuously looks to enhance e-commerce investment within Egypt whilst focusing on a customer experience; the launch of same day delivery in Cairo and Alexandria has proved popular. “We deliver almost anything you can imagine, from hair pins, hi-tech products, groceries and heavy households”, Sameh adds. A huge variety of products available indicates a thriving ecosystem. Aramex customers are no longer limited to major cities; buyers and sellers can be found throughout Egypt’s more rural areas.
Egyptian e-commerce growth has led to success for logistics, courier and package delivery companies in the e-tail space, but not without constant adaptation and an ongoing drive to evolve. Aramex’s need to innovate has led to a number of solutions, specifically with regards to e-commerce and last mile delivery. It’s state-of-the-art Shop & Ship solution that delivers from around the world to consumers’ doorstep, and its domestic solutions have catered to a demanding but developing economy.
Egypt is more often described as North Africa’s hub for e-commerce, and with a huge digital savvy population, it’s no surprise. The e-commerce market in Egypt is poised to grow 33% annually, reaching $3 billion in 2022.
With this predicated growth comes a huge opportunity for not only startups but for international brands looking to operate in the MENA region. As internet penetration continues to improve, the e-commerce sector in Egypt will likely remain on track for sustained growth.
The gradual stabilisation of consumer purchasing power and development of the national infrastructure are also likely to contribute to continued development in the coming years. As a result of incentives to equip the country’s youth for employment in the e-commerce sector, Egypt can expect a booming e-commerce sector.