As the global COVID-19 pandemic continues to spur e-commerce, a Mastercard study has revealed the rapid growth of online shopping, with nearly three out of four Saudi consumers shopping more online than they did before the pandemic.
The study provides significant insights into how shoppers are rapidly moving away from cash and opting for contact-free and digital payment experiences. These insights are helping e-retailers and businesses in Saudi and across the region, to leverage the shift towards online shopping and to deliver fast, convenient and secure transactions.
According to the survey, groceries, healthcare, apparel and banking have seen the highest surge of online activity. More than 68% of Saudi consumers said they had shopped online for groceries, 73% for clothing, and over 65% of respondents said they had purchased medicine online. And, as e-commerce increasingly becomes a part of everyday life, consumers are moving other aspects of their financial management to digital, with 64% of respondents having started banking online.
The research also reveals the rising impact of social media on consumer spending habits, with 58% and 61% of respondents saying they had discovered new sellers through Facebook and Instagram respectively.
With the rapid rise in online shopping, consumers are also becoming increasingly aware of the associated risks. More than half of consumers (54%) surveyed said that a secure checkout was fundamental for a good shopping experience.
This is a key priority for Mastercard, as it is working to reduce online fraud and protect retailers from data breaches, while ensuring that consumers still enjoy a convenient and hassle-free payment experience.
To advance these efforts, Mastercard recently rolled out its patented tokenization technology across the region. Tokenization encrypts consumer data by replacing card numbers with digital tokens. This prevents improper usage at any other location and provides additional security and peace of mind for consumers and merchants alike, resulting in higher approval rates while minimizing online fraud.
The Kingdom of Saudi Arabia enjoys one the highest internet penetration and mobile usage numbers in the region with an estimated growth to 96% by 2023. The Saudi government in turn continues to take several measures to simplify digital payments and enable affordable e-commerce. With security remaining integral to the shift towards a cashless culture, Mastercard is working with local businesses to take advantage of these long-term trends, and build e-commerce experiences that offer speed, security and simplicity for a new generation of Saudi shoppers.