Online shopping only really arrived in the urban centres of the West at the turn of the century, with retailers like Amazon and services like iTunes. Online grocery shopping soon followed, to the point where, today, no self- respecting business in Europe and the US can exist without a significant online presence.
In the West, the consequences of this change were devastating to small businesses and even larger ones in some industries. Book stores and music stores were particularly badly hit.
And yet, despite the steady growth of online commerce in the UAE – which, as The National reported yesterday, is enjoying a festive fillip, with a surge in sales as the holiday season shopping spree continues – there are good reasons to think that a similar wave of closures will not affect the malls here.
First, there is plenty of room to grow. Online commerce has been hampered by the lack of a standardised address system and by a preference for payments in cash. This is despite the high rate of adoption of smartphones, as well as a large number of cash-rich, time-poor residents.
At the same time, there are unique factors at work in the UAE. Malls, where the majority of shopping is done, are not merely places to buy things. Because of the weather, the safety and the ease of access to parking, they are important places for families to visit. They remain the primary places to socialise, especially for the young.
They also allow people to do many things under one roof, or, for hard-pressed parents, in one carefully choreographed trip. High-streets, in the West, fulfil some of this role, but there is no equivalent here. Moreover, both Dubai and Abu Dhabi are huge tourist destinations, and tourists who flock to the cities to shop and relax will not do so online.
Without a doubt, there is enormous potential for online growth. It will open up new revenue streams for businesses, as well as creating new online-only businesses.
Existing business models will likely change, as, for example, fashion retailers seek to enhance the experience of shopping in the flesh. But the characteristics of the UAE shopping environment mean that the role of the malls in the lives of people won’t go away. That, doubtless, is why so many of them are currently being built.
