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Online shopping for fashion in the UAE market will exceed 20% of the total market size within the next three years, driven by continued soaring purchase frequency and average order value, according to a new study.
Fast fashion brands are outpacing mass and premium brands in e-shopping – both in terms of awareness and purchases, according to research by RedSeer Strategic Consulting, a global consultancy specializing in online services.
“An important change in the UAE fashion scene over the next few years is an upward trend in frequency and average order value, which will drive increased share of wallet in online channels.
“This will generate more growth than adding new users. Based on this, we expect the industry’s online penetration rate to increase to over 20% by 2025,” the study said.
RedSeer expects online fashion shoppers to increase their share of wallet by more than 70%, while the number of new users is expected to grow by around 35-40% over the next three years.
According to a Statista market forecast, the UAE’s fashion industry is expected to generate around $3.7 billion in revenue by 2025, up from $2.3 billion last year.
Clothing is the largest segment of offline and online shopping in the UAE.
An increasing number of fast fashion platforms catering to transient trends and fashion-conscious shoppers is driving the rise in wallet share among online fashion shoppers.
Notably, Omnichannel became the largest online shopping platform in the UAE.
“This is due to the brand trust built over the years with a loyal consumer base in offline channels, and the significant investment made by omnichannel players to enhance their digital capabilities,” RedSeer said.
Emirati shoppers instinctively turn to omnichannel retailers first when shopping online due to high brand recall rates, the study said.
However, RedSeer warns that online retail platforms must continue to innovate to keep up with the current market pace and retain customers.
“Competition in online fashion shopping is expected to intensify in the coming years as a new group of consumers – Generation Z – enters the market,” it said.
Industry experts say the growing trend of online shopping for fashion items will further cement the UAE – and Dubai in particular – as the world’s luxury fashion hub.
Dubai has earned this crown through years of concerted efforts to promote fashion and retail in the emirate by hosting several mega-events, including the globally popular Dubai Shopping Festival.
Dubai is also home to many fashion brands, from world-renowned fashionistas to lesser-known next-generation designers.
It is also home to the largest retail mall in the world.
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