Alabbar seeks boost for Noon.com with digitally-enabled mall

Emaar’s Dubai Square is a compelling proposition for retailers and a clever way of boosting e-commerce in the UAE

“I cannot accept that our region will be taken over. I will not accept it,” he said. Photo: AFP

Dubai will have a new mega-mall - twice the size of the Dubai Mall that is the biggest in the world -- and far more modern, under plans unveiled by Emaar this week. The Dh10 billion complex, known as Dubai Square, will serve the clever additional purpose of helping the UAE capitalise on the fast-growing e-commerce industry.

“You just operate your store – don’t worry about anything else. We will operate and manage the digital side of it completely, so you can just focus on your business,” Emaar chairman Mohamed Alabbar told stakeholders at an event on Tuesday.

Emaar pitched Dubai Square as the world’s first digitally-enabled shopping mall. The complex will have its own ‘Dubai OS’ operating system embedded into its wifi to support retailers’ online operations. Mr Alabbar’s $1bn e-commerce venture Noon.com naturally, is a key part of the plans, with retailers able to list their products on its website.

Shoppers can use Noon.com if products are not in stock, and delivery firm Aramex, in which Mr Alabbar also has a stake, will take them to customers.

“We are leveraging the largest logistics network in the Middle East,” he said.

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Over time, the system will gather valuable data about people’s shopping habits, to improve both retail performance and customer service.

“Omnichannel retail is the way forward so shopping malls are here to stay, but they require e-commerce DNA to be embedded in their bricks and mortar,” Mr Alabbar added.

With the GCC e-commerce market forecast to grow to $24bn by the end of the decade, according to consultancy A T Kearney's estimates, the billionaire businessman is really on to the something with this latest venture.

It’s also no surprise that he wants to use Emaar’s biggest investment to date (Dubai Square is part of the Dubai Creek Harbour scheme, set to become the new heart of the emirate) to beef up his other interests – Aramex and Noon.com. The latter launched in the UAE last year, but has yet to raise its profile amid fierce competition from Amazon's Souq.com and others. Encouraging retail tenants to be a part of Noon’s growth strategy is smart.

The scheme should also be a no-brainer for global brands. An invitation to hand over their digital operations to Dubai Square and its partners is a compelling proposition as successful e-commerce requires expertise and investment. But they must be careful not to lose their place in the global retail race.

It’s all very well Mr Alabbar telling retailers, “you just focus on your business”. But in a world where e-commerce is disrupting traditional retail, digital strategy is part and parcel of any retailer’s growth strategy. If they fail to develop that side of the business it themselves and acquire necessary expertise, they run the risk of missing in other markets in future.