x Abu Dhabi, UAEThursday 22 February 2018

UAE’s global top spot in smartphone use gives local SMEs huge opportunities

As the mobile technology revolution accelerates, digital applications will become increasingly vital for businesses wanting to maintain a sharp commercial edge.

As the mobile technology revolution accelerates, digital applications will become increasingly vital for businesses wanting to maintain a sharp commercial edge. Sarah Dea / The National
As the mobile technology revolution accelerates, digital applications will become increasingly vital for businesses wanting to maintain a sharp commercial edge. Sarah Dea / The National

With the enormous uptake of smartphones in this country – recent research conducted by Google ranked the UAE number 1 in global smartphone penetration at 73.8 per cent – the growth in the use of mobile applications is set to continue next year but there will probably be some new twists that local small businesses might do well to take advantage of.

A market such as the UAE – where SMEs represent more than 94 per cent of businesses in the country, according to government data – offers the app industry enormous potential, predicts MediAvataarme.com, a Middle East online brands, marketing, media and advertising specialist.

“Small businesses are witnessing the tremendous success of their counterparts and now want a piece of the app pie. And with app creation becoming more affordable every day, the technology is now within reach of most businesses, regardless of size,” Fahad Al Bannai, the chief executive of Axiom Telecom told MediAvataarme.

In market research institute GfK’s Connected Consumer Index 2016, the UAE scored 995 points, ranking behind only Hong Kong and North America in its list of 78 countries. Globally, the average score in the index stood at 313, while for the Mena region, it was at 127.

Perhaps one of the most interesting emerging mobile tech developments is that which will blur the line between being online and offline – beacon technology. Apple’s iBeacon has been a pioneer on this front, allowing mobile apps to pinpoint their position on a micro-local scale, and deliver hyper-contextual content to users based on location. The result? Businesses can offer real-time deals based on where they are at any given point in time.

“Imagine you’re walking down a boulevard, hungry, and you receive a notification that your favorite burger spot is offering a great deal – that is what location-based services, such as beacon technology, is allowing businesses to do,” said Mr Al Bannai. “It gives them the ability to reach the right customer, at the right time, and the right location. This is definitely a great tool for businesses, but will also be beneficial to the end-user, as it helps them find what they need, when they need it.”

Such remarkable developments in technology and the continuous success being realised by major international brands is inspiring small businesses to follow suit and develop apps of their own. According to figures reported by the mobile app publishing platform Bizness Apps, more than 50 per cent of small business will be looking to create a mobile app next year. Furthermore, it is expected that more than 268 billion downloads will generate US$77 billion worth of revenue for the app industry next year.

In addition to apps, augmented and virtual reality will witness tremendous growth next year, according to Mr Al Bannai.

Mobile manufacturers such as Samsung and HTC have already started exploring this space with the Gear VR and VIVE, respectively, but that is only the start to a whirlwind of cutting-edge virtual and augmented reality technologies that will soon hit the market, Mr Al Bannai said.

According to the market advisor Digi-Capital, global augmented/virtual reality revenue is expected to reach $120bn by 2020, with augmented reality accounting for $90bn and virtual reality accounting for $30bn, and driven largely by the consumer and mobile AR/VR markets.

“There is great interest in this field because of the many different useful applications that augmented and virtual reality could potentially assume – be it entertainment, training, or education,” said Mr Al Bannai. “This takes the mobile experience to another level, enabling people to use their hand-held device to completely immerse themselves in another world, not only as passive observers, but as protagonists of their own digital universe.”

Alongside apps and VR, businesses, especially in the retail sector, must embrace the technological revolution.

Booz Allen Hamilton, the global consulting and technology firm, has found that investing in customer analytics offers exciting opportunities for the growth and development of the regional retail sector.

Its report – titled Next Generation Retailers: Power Up Your Analytics – shows the global retail sector is changing in the face of an unprecedented shift in customer behaviour, fuelled by advanced technology and wider acceptance of online shopping and ecommerce.

According to Euromonitor, the Mena region is emerging as a global hub for retail and the sector is expected to have grown from $996bn in 2015, to $1.05 trillion in 2016.

Increased property and labour costs are also driving businesses to seek a profitable mix of traditional and digital sales channels. The onus is therefore increasingly on the retailers to embark on digital programs to ensure that outlets remain both relevant and profitable.

“We have found that there is immense pressure on retailers brought on by changing shopper dynamics,” Danny Karam, the vice president at Booz Allen Hamilton Mena, told MediAvataarme. “Retailers must understand changing customer behaviour and shopping preferences, manage the cost of brick and mortar establishments, mine data and amplify their outreach through an omnichannel platform to provide a seamless shopping experience that will, in turn, create new revenue streams beyond the shop floor.”

chnelson@thenational.ae

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