EBay partners with noon for door-to-door Saudi and UAE deliveries

Mohamed Alabbar, founder of online shopping platform noon. (Courtesy of noon)
Updated 12 June 2018
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EBay partners with noon for door-to-door Saudi and UAE deliveries

  • Service to be launched in UAE and Saudi in the second half of the year
  • Agreement follows acquisition of Souq by Amazon last year

LONDON: Saudis will soon be able to buy goods directly from eBay and get them delivered to their doorstep.

It follows a deal between the e-commerce giant and regional shopping platform noon.com, the online platform backed by Emaar chairman Mohamed Alabbar and Saudi Arabia’s Public Investment Fund.

The agreement represents a major milestone for noon as it competes with Amazon-owned Souq for supremacy in the Gulf region’s fast growing e-commerce market.

“With this (agreement), we are offering our customers access to products that are not otherwise readily available in the region,” said Alabbar in a statement.

“Our partnership with eBay opens a whole new world of shopping experience.”

The new facility will be launched in the UAE and Saudi Arabia in the second half of the year via a standalone app.

Noon and eBay will share best practices and explore joint marketing opportunities as part of the agreement, noon said.

The partnership with noon follows the acquisition of regional rival Souq by Amazon last year for  $580 million.

Amazon rolled out its Amazon Global Store in December for customers in the UAE, offering more than a million products including home goods, watches and shoes.

Amazon has been scaling up its presence in the region in the past months, advertising for several jobs in Riyadh following a meeting in April between CEO Jeff Bezos and Saudi Crown Prince Mohammed bin Salman in April, Bloomberg reported.

Mohamed Alabbar unveiled noon in November 2016, saying that the platform would go live in January 2017. But a series of setbacks, led to the service only coming on stream in the UAE last September, and only going live in Saudi Arabia in December.

The partnership with eBay provides noon the opportunity to compete with Souq on scale.

“Being able to offer millions of products at any given time is a key differentiator for any e-commerce player who wants to lead the industry,” said Sauvik Tegta, a senior Manager at consultants A.T. Kearney

“Noon has already announced plans to offer a product assortment that exceeds 20 Million SKUs (stock keeping units), and the partnership with eBay will further help it achieve and exceed this target. This is especially crucial considering its competitor Souq.com already offers access to the Amazon Global Store service.”

While e-commerce accounts for a tiny proportion of retail sales in the Gulf region compared with markets in Western Europe and Asia, the rising penetration of smartphones and the entry of leading global players such as Amazon and eBay is forecast to accelerate growth in the sector.

“Consumer awareness was one of the barriers, but with Amazon entering the market and with large investments from Noon and traditional retailers, e-Commerce has garnered significant industry and the media spotlight that has raised its profile across GCC,” said Tegta.

Significant progress has been made in the last mile delivery within the GCC, one of the key challenges facing e-commerce players both in the region and abroad, he said.

An example of this was the growth of local delivery firms such as Fetchr, which raised $40 million in funding last year to scale up to meet growing demand for online shopping deliveries.

But the region still faces a series of logistics challenges, Tegta said.

“Warehouses and fulfillment centres are still not optimally located close enough to the market demand, so it can take several days to get products from a warehouse to a distribution center,” he said. 

The GCC’s e-commerce market is forecast to be worth $24 billion by 2020, compared with $5.3 billion in 2015, according to A.T. Kearney forecasts.


Airbus bags Cebu Air deal as sales flounder at Paris Airshow

Updated 2 min 14 sec ago
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Airbus bags Cebu Air deal as sales flounder at Paris Airshow

  • Cebu Air’s order included 10 of Airbus’s new long-range A321XLR passenger aircraft
  • There is speculation that a decade-long boom in orders might be coming to an end
LE BOURGET: Airbus struck a $6 billion plane deal with Philippines budget airline Cebu Air on Tuesday, extending its lead on orders at a subdued Paris Airshow as rival Boeing struggles following the grounding of its top-selling jet.
Cebu’s order included 10 of Airbus’s new long-range A321XLR passenger aircraft, which was launched at the show on Monday, as well as 16 wide-body A330neos and five single-aisle A320neos.
Reuters reported on Monday that Cebu was poised to buy more than two dozen Airbus planes.
Sources familiar with the matter say American Airlines and leasing giant GECAS are also in talks to buy the A321XLR, which aims to carve out new routes for airlines with smaller planes and steal a march on Boeing’s plans for a potential all-new mid-market jet, the NMA.
Despite the flurry of activity around the A321XLR, however, dealmaking at the aerospace industry’s biggest annual event has been quieter than normal, fueling speculation that a decade-long boom in orders might be coming to an end.
With airlines struggling with over-capacity, slowing economies and geopolitical tensions, some analysts warn Airbus and Boeing could face a growing number of cancelations from their bulging order books.
Boeing in particular is suffering after the grounding of its MAX 737 aircraft in March following two deadly crashes.
However, the planemakers are confident of continued strong demand for more fuel-efficient planes as emissions regulations tighten and as air travel continues to rise, driven by Asia’s growing middle classes. Boeing on Monday increased its 20-year industry demand forecast.
“Although investors have started to ask questions about the state of the upcycle, the aerospace industry remains very confident in the current state of the market,” analysts at Vertical Research Partners said in a note.
Cebu Air Chief Financial Officer Andrew Huang told a news conference the 16 A330neo jets it was buying would have up to 460 seats, allowing the airline to add new international routes.
Cebu, which operates the Cebu Pacific brand, had a 51 percent share of the Philippine domestic market in 2018, according to company data. In the international market, its 19 percent share was second only to full-service rival Philippine Airlines with 28 percent.
After announcing no major aircraft orders on Monday, Boeing could unveil some on Tuesday, including a potential deal with Air Lease Corp. whose founder Steven Udvar-Hazy told reporters on Monday he would be “at Boeing tomorrow.”