The Launch of Noon: The Region’s Ecommerce Battle is On
Last November, we announced that Emirati businessman, Mohamed Alabbar and Saudi Arabia’s Public Investment Fund (PIF) were teaming up to launch the region’s biggest e-commerce platform, Noon.com, at an initial investment of $1 billion in January.
The announcement also stated that Noon would go live in January with 20 million products to offer, ranging from electronics to fashion to home/lifestyle, and that Noon will initially operate from and focus on Saudi Arabia and the U.A.E. prior to expanding across the region.
Noon finally launched yesterday for customers in the UAE who can now purchase products via Noon’s website or by downloading the Noon Mobile app – currently only available via Google Play Store, and should be available on the App store in the next few days. Customers in the UAE can now purchase products covering electronics, fashion, beauty, baby, home & kitchen and grocery. However, the release sent to media outlets yesterday did not mention if 20 million products were available on the platform. Moreover, Noon is set to go live in Saudi Arabia in the coming weeks.
The e-commerce venture had promised that they would offer same-day delivery by using Aramex's and Americana's logistic capabilities to deliver goods. To address regional issues around electronic payments, the venture had stated that they will accept both online payments as well as cash upon delivery, and will be introducing its own secure payment gateway, Noonpay. We don’t have word if these services are currently available.
Some Noon History
Less than 2 weeks ago, Kuwaiti based, international retail franchise operator M.H. Alshaya Co. acquired a strategic stake in noon who also became a seller on the marketplace platform, providing Noon’s customers with access to Alshaya’s international brands covering the fashion, health & beauty and home & lifestyle categories.
Back in May, Emaar acquired Dubai-based online marketplace JadoPado, and acquired 51% of Namshi from Rocket Internet. It’s also involved in a joint venture with Yoox Net-A-Porter. In July, Noon appointed Faraz Khalid, former Co-Founder and Managing Director of Namshi as CEO of Noon following Fodhil Benturquia’s departure from the role in May.
The Ecommerce Battle
Back in March, Amazon confirmed that it successfully acquired Souq.com, its regional competitor, and PayFort, an online payment platform for ecommerce platforms. Obviously, the acquisition of Souq gives Amazon a head start in the region rather than building from the ground up. Buying Souq provides Amazon with an existing customer base, access to regional merchants, and existing infrastructure. At the time of the acquisition, Souq was selling over 2 million products in addition to the global bookstore introduced earlier in the year with over 6 million books accessible to their customers, and their online grocery platform, which they introduced in November. Additionally, with PayFort, Amazon also secured the payments infrastructure as well. With Amazon's global reach, track record, and technology, consumers are up for the win.
With Noon.com up and running, consumers will benefit from the rivalry amongst the giants. Aramex should give Noon a logistics advantage, so should Alshaya’s stake, the $139 million joint venture with Italian online fashion retailer Yoox Net-a-Porter, and let’s not forget that Emaar Mall Group's flagship is the world's largest and most visited mall, The Dubai Mall.
We will continue to keep an eye out on the ecommerce sector for any developments.