MENA Electronics retail market is forecasted to grow at a CAGR of 9% to represent a ~$100 Bn opportunity by 2027 with E-tail being the key growth driver. While offline electronic specialist stores have traditionally driven sales, they are experiencing strong competition from e-commerce marketplaces. Consumer’s increased emphasis on service experience is at the core of this change as E-commerce marketplaces are offering shoppers a superior user experience across their shopping journey

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MENA Electronics: $100 Bn
market by 2027
September 2022

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Agenda
• Market Section
• Competition View
• Product Category View
• Market Trends
• Consumer Journey

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The Electronics retail market is currently $59 Bn and is forecasted to grow at a
CAGR of 9% to represent a ~$100 Bn opportunity by 2027
MENA1 Electronics Retail Market Size
USD Bn, 2019 - 2027 (F)
55
50
59
99
2027 (F)
2019 2020 2021
+9%
Source(s): RedSeer Primary Research and Analysis
Note(s): 1. MENA includes GCC countries, Egypt, Morocco, Iraq, Tunisia, Algeria, Libya, Lebanon, Yemen, Syria & Jordan

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Growth of the electronics market in the MENA region is supported by strong
tailwinds
MENA Electronics Retail Market Growth Drivers
Descriptive
Source(s): RedSeer Primary Research and Analysis
Rise of remote
working and
learning
Rising disposable
income across the
region
• Rising disposable income in the MENA region, coupled with lifestyle changes will
drive discretionary spend on electronic products
• Gaming and Home Audio and Cinema are product categories that witnessed
strong growth in 2020-21 as consumers deployed additional disposable income
generated from decreased spend during the pandemic
Retail-fintech
partnerships
• Pandemic infused proliferation of remote working and learning has increased
penetration of laptops and phones
• Regional transition towards a digitally enabled lifestyle will drive demand for
electronic products
• Retail-fintech partnerships and new payment schemes increase the affordability
of electronic devices for broad segments of society
• Retailers are experiencing enhanced sales to Gen Z shoppers as shoppers can
now carry out product purchases while sticking to their monthly budgets

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Electronics E-tail market is poised to drive the overall growth of the MENA
electronics market, growing at 23% CAGR
MENA Electronics Retail Market Size and Split
USD Bn, 2019 - 2027 (F)
2020
2019 2021 2027 (F)
55
50
59
99
Online
Offline
~5%
~23%
CAGR (2021-27)
(in %)
Source(s): RedSeer Primary Research and Analysis
Electronics E-tail
Growth Drivers
• Consumers are increasingly
gravitating towards online
owing to the product variety,
competitive pricing and
ability to access user reviews
• Superior customer
experience provided by online
retailers are ensuring
customer stickiness
• Pandemic infused adoption
of online shopping has driven
seamless transition of
consumers to online

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UAE is a prime example of consumers seamlessly transitioning to E-tail
platforms, particularly Male and Gen Z users
UAE Electronics E-tail Adoption By Gender1
% of cohort level online shoppers, 2021
Female
Male
Note(s): 1. Which of the following sectors have you shopped online in past 6 months?
2. The figure mentioned above is derived from the consumer surveys and not the representative of actual online adoption
UAE Electronics E-tail Adoption By Age1
% of cohort level online shoppers, 2021
Gen Z Gen Y Gen X
Source(s): RedSeer Primary Research and Analysis
Electronics
68%
UAE Electronics E-tail
Adoption1
% of online shoppers, 2021
UAE Illustrative

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Agenda
• Market Section
• Competition View
• Product Category View
• Market Trends
• Consumer Journey

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Offline Electronic specialist stores currently hold the edge over online channels
but are experiencing increased competition from e-commerce marketplaces
MENA Electronics Retail GMV Split by Business Model1
2021, % of GMV
• Offline retailers continue to
account for the largest share
in consumer electronics, as
consumers can touch and
feel the products prior to
purchasing
• However, consumers are
increasingly visiting stores to
experience the product,
before going on to conduct
their product purchases
online
• E-commerce is providing
strong competition, as
residents in MENA have
become comfortable
undertaking digital
transactions
Offline Electronic
Specialists
Electronics
Offline Hypermarkets
E-Commerce
E-Commerce
Marketplaces
Electronics
Others
MENA Electronics E-tail GMV Split by
Business Model
2021, % of GMV
Source(s): RedSeer Primary Research and Analysis
Note(s): 1. Electronic specialists refer to players that only sell electronic products. Some examples of electronic specialists include Sharaf DG, E Max, Jumbo Electronics
2. Hypermarkets refer to players selling a wide variety of food & beverages, electronics and personal care products. Some examples of hypermarkets include Carrefour, Lulu, Panda
3. Others category includes Shop & Ship, Electronic specialists and hypermarkets
Illustrative
Highlights

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Within the online channel, players in the region are increasingly consolidating
their market share
Top 5 players by market share – Online Electronics
% of Online Electronics Sales, 2020-2021
Highlights
• The market is getting
increasingly concentrated
among leading retailers as
they have been able to build
trust and offer competitive
pricing and product variety
• Marketplaces are dominating
the electronics market.
Online discount events such
as White Friday/ Yellow
Friday drive sales for E-
commerce marketplaces
• Offline retailers are losing
their market share as
consumers are transitioning
to online channels owing to
convenience and seamless
shopping experience
Consolidated
Market
Maturity
Fragmented Balanced
Source(s): RedSeer Primary Research and Analysis
2020 2021
Top 5 players share
Others
Illustrative

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Agenda
• Market Section
• Competition View
• Product Category View
• Market Trends
• Consumer Journey

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Mobiles and Electronic Accessories have the highest purchase adoption for
electronic products in MENA
Source(s): RedSeer Primary Research and Analysis
Product Purchase Categories1
% of Electronics shoppers purchased, in the last 6 months
Note(s): 1. Which of the following Electronics products/categories have you bought (offline + online) in the past 6 months?
Mobile Accessories Computers &
Peripherals
Home &
Kitchen
Appliances
Others
Electronics Retail vs E-tail: Top categories
Category Ranking
Retail E-tail
Computers &
Peripherals
3
Mobile
1
Home & Kitchen
Appliances
2
Accessories
3
Mobile
1
Computers &
Peripherals
2

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Agenda
• Market Section
• Competition View
• Product Category View
• Market Trends
• Consumer Journey

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BNPL schemes are providing MENA consumers with the ability to purchase
previously unaffordable electronics products on more convenient terms
Source(s): RedSeer Secondary Research and Analysis
Decision Making Influence
In % of Electronics shoppers
Ease of Payment >70%
Consumers are gravitating towards retailers providing a
seamless checkout experience with payment options
including BNPL
• New partnerships between payment
providers, fintech, and retailers are
making BNPL accessible and attractive to
consumers
• Retailers are experiencing enhanced
sales to Gen Z shoppers as shoppers can
now carry out product purchases while
sticking to their budgets
BNPL is revolutionizing the way consumer’s shop and pay for their electronic purchases
Evolving Consumer Behavior Stakeholder Benefits
Fintech Retailer Collaborations
• Sharaf DG partnered with Visa and Mashreq Bank allowing
clients to choose BNPL schemes when paying in-store POS.
This spares shoppers from the need to register with a
separate BNPL provider
• Jarir partnered with Quara Finance, allowing clients to pay for
electronics purchases in instalments, with the stipulation that
products are to be collected in showrooms

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Better
hardware
• Higher RAM & better processing power in phones allowing better graphics
• Storage capacity of mobiles have enabled users to store larger, complex
games, encouraging developers to build games with better graphics
• Modern screen technologies allows a superior experience and longer
screen time even on phone
OEM focus on
Gaming
Smartphone
• Companies like Asus, Xiaomi, Nubia have launched gaming-specific
smartphones with high refresh rate screens, game modes, triggers, etc. to
cater the growing demand of mobile gaming
• Game-focused accessories : A new accessory market is emerged with the
growing popularity of mobile gaming Gaming-specific smartphones & accessories
Gaming innovations driving growth
Renewed interest in gaming, driven by lifestyle changes and supply side
innovations are further driving demand for new device purchases in MENA
2020
2018 2019 2021
295$ 300$ 308$ 320$
Global Average Phone Selling Price
(in USD), 2018-2021
Cloud Gaming
• Cloud gaming has made gaming more accessible by offering users the
ability to game on demand from any device irrespective of their
infrastructure, examples: Xbox – PS- Stadia etc.)
Both PlayStation/Xbox/ & google stadia
offering cloud gaming
Modular (self-
assembled)
devices
• Firms are launching modular PCs, laptops, and phone in which each part is
chosen and installed by the final consumer; and can be changed
conveniently at the discretion of the user. (Framework Laptop, modular
smartphones, gaming PCs)
Framework’s DIY laptop
Source(s): RedSeer Secondary Research and Analysis

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Electronics brands are creating an eco-system of products to retain consumers
once they have been attracted
Brand
Ecosystem
Health and Wellness Benefits
Data points collected on user behavior by brands
based on usage across various devices is helping
them provide targeted information and advice to
users across various health and wellness
parameters
Integration Seamless
Experience
Integrated features such as
phone screen projection on
laptop screens, app and
user data syncing are
limited to devices from
similar brand ecosystem.
The ecosystem enhances
user experience by
providing standardized user
interface and facilitating
seamless transition of
activities across devices
Bundling Offers
Electronics retailers bundle supplementary devices
and accessories from the same brand ecosystem to
stimulate high average selling prices
Financial Benefits
Provides access to subscriptions
across devices using the same
brand-user account without
paying extra charges
Source(s): RedSeer Secondary Research and Analysis
1
2
3
4

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Agenda
• Market Section
• Competition View
• Product Category View
• Market Trends
• Consumer Journey

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Digital media has altered the electronic shopper’s research behavior in the UAE
Pre-Purchase Behavior
Electronics
Shopper
Journey Begins
when the need
for a product
arises
68%
shoppers
search for
products using
Retailer Apps
60%
shoppers
discover new
products on
digital media
55%
shoppers are
primarily
influenced by
friends & family
47%
shoppers
encounter ads
that influence
their purchase
Active
Need
Passive
Need
Highlights
• Shoppers in the region
undertake extensive
research before
purchasing products
• Passive shoppers are now
discovering new products
on digital media through
targeted advertisements
and personalized content.
Repeated exposure to such
content makes their need
evolve from a passive to
an active one
• Once the customer’s need
is active, they primarily rely
on retailer applications to
search for products. These
platforms facilitate
effective product and price
comparison
UAE Illustrative
Source(s): RedSeer Primary Research and Analysis

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While product features drive purchase decision, service experiences are
becoming critical to electronics consumer’s decision-making process
Decision Making Criteria: Electronics
Purchasing1
Weighted score of responses
Note: 1. Rate the key factors that influence your decision-making while purchasing Electronics on a scale of 1-10? (1 being the least important, 10 being extremely important)
Source(s): RedSeer Primary Research and Analysis
Purchase Behavior
7.7
8.4
2021 2022
Speed of Fulfilment
(Fast Delivery)
+9%
7.9 8.3
2021 2022
Customer Service
& Support
+6%
8.8 8.7 8.5 8.5 8.4
Clear
Product
Details
Product
Quality
Value for
Money
Ease of
Payment
Quality
Delivery
Experience
Platform Features
Product Features
Service Features
2022
Highlights
• Service features have
become increasingly
important in driving
purchase decisions. Speed
of fulfilment, customer
service and quality
delivery experience are
some key service
parameters that have
grown in prominence
among purchase decision-
making criteria.
• As competition among
retailers on product
features saturate, they are
pivoting focus towards
service and platform
features to build a loyal
customer base
UAE Illustrative
Decision Making Criteria: Service
Parameters1
Weighted score of responses

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Shoppers are reporting greater satisfaction with E-commerce marketplaces
owing to their superior offering across the shopping journey
Purchase Satisfaction
58%
72%
57%
-6%
-12% -10%
52%
Electronics
Specialist
Retailers
E-commerce
marketplace
60%
Hypermarkets
47%
Online Electronics Retailer Channel NPS1
% of online electronic shoppers
74%
51% 48%
-8%
-13% -15%
66%
Hypermarkets
E-commerce
marketplace
Electronics
Specialist
Retailers
33%
38%
Detractors
Promoters
2021 2022
Highlights
• Product and price
comparison features,
competitive pricing and
superior customer service
have been key in attracting
shoppers to e-commerce
platforms
• Hypermarkets and
electronics specialists
should increasingly focus
on leveraging their
omnichannel presence to
deliver an immersive and
holistic shopping
experience, in order to
differentiate themselves
and create value to
consumers
UAE Illustrative
Note(s): 1. On a scale of 0-10, how likely are you to recommend the following Electronics retailer channel to your friends & relatives? (0 - Not at all Likely, 10 - Very Likely)
Source(s): RedSeer Primary Research and Analysis

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Coverage of full perspective
• MENA Electronics retail market size (2019-2027F)1
• MENA Electronics E-tail market size (2019-2027F)
• Electronics E-tail adoption
• E-tail Sector Comparison – Penetration vs Growth vs Size
• E-tail usage motivators
• Electronic market trends
• Consumer decision making criteria
• Competition View (GMV, Consumer channel preference, Awareness & Engagement, NPS)
• Electronics product category view (GMV comparison, E-tail penetration, Purchase adoption)
• Consumer product search and discovery channels
• Consumer purchase influences: Ad influence and personnel influences
Thank you for your time.
This was an overview of the electronics sector. The full perspective goes into a
lot more detail as outlined below
Source(s): RedSeer Approach
Note(s): 1. MENA includes GCC countries, Egypt, Morocco, Iraq, Tunisia, Algeria, Libya, Lebanon, Yemen, Syria & Jordan

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Country level deep-dives:
• GCC Countries (UAE, KSA, Qatar, Kuwait)
• Egypt
• Turkey
Product Category level deep-dives:
• Consumer Electronics (Mobile, computer peripherals, accessories, gaming products etc.)
• Consumer Appliances (Home and Kitchen Appliances)
Furthermore, we have country and product category level deep-dives for
electronics
Source(s): RedSeer Approach
Note(s): 1. MENA includes GCC countries, Egypt, Morocco, Iraq, Tunisia, Algeria, Libya, Lebanon, Yemen, Syria & Jordan

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Authors
Sandeep Ganediwalla
Partner
Redseer MEA
Akshay Jayaprakasan
Engagement Manager
Redseer MEA
Abhishek Rajput
Associate Consultant
Redseer MEA

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Project Team
Milli Saklani
Business Analyst
Redseer MEA
Nikhil Harikumar
Business Analyst
Redseer MEA
Leticia El Zein
Business Analyst
Redseer MEA

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Source(s): Consultancy Middle East
Top strategy consulting firms in the Middle East
Top e-commerce consulting firms in the Middle East
Top retail consulting firms in the Middle East
Top private equity consulting firms in the Middle East
Platinum Consulting Firm Pioneering the METAP Digital Economy
About Redseer - Industry Pioneer in the Middle East

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