UAE retail looks ahead to another stellar year – News

GMG sees online and offline as complementary modes to meet consumer needs

Geant hypermarket at Dubai Hills Mall. With the recent acquisition of the Géant supermarket chain in the UAE, GMG is now a leader in the food retail industry. – Photos provided

Anyone who has been to The Dubai Mall of late will be convinced that the emirate has managed to put the dark days of the pandemic behind it. Stores are packed with shoppers even on weekdays, and sales desks keep ringing as shoppers make up for two lost years.

Dubai has truly returned to the global stage as a shopping paradise. Amid this, the country’s retail giants are busy beefing up their strategies to capitalize on the trend.

In this regard, Khaleej Times caught up with Mohammad A. Baker, Vice Chairman and CEO of GMG, to find out how the UAE retail sector has fared this year and his outlook for the year ahead.

GMG is a global wellness company that retails, distributes and manufactures a range of leading international and local brands in the sports, food and wellness sectors. Today, GMG’s investments span four key verticals: GMG Sports, GMG Foods, GMG Health and GMG Consumer.

With the recent acquisition of the Géant supermarket chain in the UAE and the expansion of the Géant, Monoprix and Franprix brands in the Middle East, GMG is now a leader in the food retail industry.

Under the ownership and management of the Baker family, it has become a leading global company with some of the most successful and respected wellness brands in the world.

GMG operates in the Middle East, North Africa and Asia and has introduced more than 120 brands to its markets. These include well-known local brands such as Sun & Sand Sports, Dropkick, Supercare Pharmacy, Farm Fresh, Klassic, as well as international brands such as Nike, Columbia, Converse, Timberland, Vans, Mama Sita’s and McCain.

GMG Vice Chairman and Chief Executive Officer Mohammad A. Baker. – Photos provided

Khaleej Times: In 2020, with the outbreak of the pandemic, we saw a boom in online retail. How has this trend changed as we finally look to the post-pandemic world?

Muhammad A. Baker: For retailers, 2022 is a period of consolidation after two tumultuous years. Online shopping, or e-commerce, has surged during the pandemic, but once vaccination rates improve and cases start to decline, we’ll see an increase in brick-and-mortar shopping. This is especially unique to the Middle East, where shopping malls are still part of the social fabric.

Both retail formats offer some unique experiences and benefits to customers, GMG, one of the leading retail groups in the Middle East, has witnessed the rise of a hybrid retail environment, dubbed ‘phygital’, which we firmly believe will define the region in the coming years retail landscape.

Our teams are increasingly aware that online and offline are no longer substitutes or competitors, but increasingly complementary. The challenge, then, is to make an e-commerce store feel like a brick and mortar store, with employees who can respond to customer needs in real time.

We will then need to bridge the gap between the physical and virtual retail experience, as customers no longer differentiate between online and offline shopping; they often start shopping in one and then check out in one. Therefore, retailers should not differentiate between online and offline because their customers will not.

Of the overall mix, what share of retail do you expect to remain online?

A recent report by the Dubai Chamber of Commerce on the health of the UAE’s e-commerce industry confirmed that online shopping in the UAE is on the rise, reaching US$4.8 billion in 2021, compared to US$2.6 billion in 2019. Therefore, it is fair to say that consumers still have a strong preference for online shopping, and this trend will continue until 2023.

The new Sun and Sand Sports store at The Dubai Mall. – Photos provided

However, the standout reveal of the Dubai Chamber report is the dominance of domestic e-commerce players in the local market, accounting for 73% of total sales in 2021. This clearly shows that local retailers have an advantage that their international competitors lack – a better grasp of local market conditions, culture, language and social nuances.

That’s why major global brands seek local partners to leverage their local knowledge, expertise and regional footprint. In fact, more than 120 brands are proud to work with GMG as we not only pave the way for market entry, but also achieve higher business by leveraging our extensive and growing presence and experience in the Middle East and Asia success.

So while e-commerce continues to play an important role in retailers’ offerings, they must also remember that localization is the golden key to unlocking the potential of e-commerce in the UAE.

In a region with a predominantly tropical climate like the UAE, ‘shopping and entertainment’ has been a major draw for many years. How has this changed from selling online?

We don’t see brick-and-mortar and online shopping experiences cannibalizing each other. In fact, the two are complementary, and in the post-epidemic era, we expect the brick-and-mortar shopping experience to improve, which will leverage the strengths of brick-and-mortar stores and e-commerce. This physical experience leverages an omnichannel model to give consumers the best of both worlds.

We’re hearing a lot about omnichannel retailing these days. How do you see this combination moving forward in the new year?

In response to growing interest in e-commerce, many retailers are exploring omnichannel models that leverage digital innovation and the personal connection to business that in-store shopping provides.

An ideal omnichannel strategy should seek to replicate the immediacy of a brick-and-mortar store in an online environment, being able to react immediately to customer needs, providing accurate real-time advice and recommending alternatives to encourage customers to choose other options or purchase add-ons.

Thus, an effective omni-channel strategy bridges the gap between the physical and virtual retail experiences, where the two complement each other, especially as more and more buyers research products online and then visit the store to see, touch and complete the purchase Down.

However, retailers should not adopt a one-size-fits-all strategy for online shoppers. Omnichannel enables retailers to mine data for valuable insights. These insights are critical to hyper-personalization, the key to maintaining brand loyalty in the digital age. In fact, a recent BCG study showed that retailers see a 25% increase in revenue, based on the Personalization Maturity Index, due to their advanced personalization capabilities.