The untapped potential of Egypt’s emerging eCommerce market

Egypt is the third most populated country in Africa with 99.3 million inhabitants.  The country is home to the highest number of Internet users in the Arab world, with over half the population online, accounting for 49.2 million users(1).  In fact, Hootesuite’s Digital in 2018 report showed year on year growth in the country’s internet users from January 2017 – January 2018 at 41 per cent. With an eCommerce market still in its nascency, there is  huge potential in tapping into Egypt’s online market.

The Ministry of Communications and Information Technology (MCIT) of Egypt reports that Egypt’s consumer market is predominantly under 30 years of age and increasingly technology-savvy.  With  eshopworld reporting that the leading age group for online purchase is between 26 – 35 years of age, the country has one of the largest populations of prospective online shoppers in the Arab speaking world.  This is further underpinned by  “huge government support for technology and the population’s increasing demand for branded products,” according to Alia el-Mahdy, Professor of Economics at Cairo University.

According to Société Générale While Egypt’s penetration rate is below the global average of 54.4 per cent, it is above the African average of 35.2 per cent. This rate has increased 41 per cent when compared to January 2017, accounting for 14 million new users over a 12-month period. This positions Egypt as having the second highest number of internet users in Africa, behind Nigeria (98.4 million) and ahead of Kenya (43,3 million).   Société Générale further reports that smartphone penetration rose to 30.4 per cent in 2017 with almost 29 million devices (Newzoo Global Market Report), laying a fertile foundation for investment in eCommerce initiatives.

Egypt’s eCommerce Market

Société Générale reports that as a country straddling both the Arab world and Africa, both pan-Arab and pan-African e-commerce websites are popular in Egypt. As such, reports that the local edition of the Pan-Arab shopping engine, Yaoota, a platform which finds, compares and facilitates buying of products in Egyptian online stores ranked #11 in 2018 while the Pan-African general retailer Jumia ranked #1 in 2018.

According to Société Générale, the introduction of international online sales events that are adapted to the local context (i.e. White Friday, based on Black Friday sales event, and Mobile Week) have impacted on boosting sales in recent years, showing the market’s openness to new sales and marketing concepts.

In 2017, the Egyptian B2C eCommerce turnover grew by 22 per cent, reaching US$ 5 billion. This turnover has huge potential, with eCommerce currently only accounting for 0.4 per cent of retail sales in the country, according to a report by the Ministry of Communications and Information Technology, providing insights into the extent of scalability of eCommerce to penetrate this market base.

Société Générale provides insights in Egypt’s eCommerce readiness, stating that Egypt fares badly on UNCTAD B2C E-Commerce Index 2018, ranking 116th out of 151 countries worldwide. In 2017, the Egyptian government partnered with the UNCTAD (United Nations Conference on Trade and Development) – a UN Secretariat body dealing with trade, investment, and development issues  – to develop a new strategy that aims at increasing the current share of eCommerce in GDP to 2.32 per cent, and doubling the number of businesses selling online (currently about 14,725) by 2020. 17 per cent of large firms and 3 per cent of SMEs sell online at the moment according to latest estimates of the Egyptian government.

eCommerce sales and customers

According to Société Générale, mobile phones accounted for 61 per cent of online purchases in 2017, followed by laptops (37 per cent) and clothes (34 per cent).

While the increase from 15.2 million to 17.7 million online shoppers between 2015 and 2016 illustrates a steady increase in the online consumer ecosystem, Egypt still has a long way to go before reaching its potential as the largest online market in Africa and the Middle East as a result of its large population.

There is also a marked difference in reach of the online marketplaces between rural and urban areas with 70 per cent of online shoppers located in urban areas.


Cash on delivery is the predominantly preferred payment method. Eshopworld attributes the country’s cash-based economy as one of the key challenges to slowing the growth of Egypt’s ecommerce.   With 72 per cent of customers using cash for their eCommerce purchases, only 8 per cent of current internet users are in fact online shoppers.

There is a low number of credit and debit card holders in the country, around 10 million people, which Société Générale says is one of the main challenges e-commerce faces in the Egyptian market. According to PayFort, 67 per cent of consumers state they would be willing to switch to online payments if they knew it was secure.

 Social media

Social media platforms are gaining popularity in Egypt.  However, social media penetration rates are far from reaching maturity. According to Société Générale, around 40 per cent of the total population in Egypt is active on social, of which 35 million also access their accounts via mobile (36 per cent of total) (Hootsuite 2018). These figures mark a 11 per cent increase since January 2017, so there were 4 million new social media users in the country during that period.

While social media penetration rate remains somewhat low, the quality of internet interaction is high with Egyptian internet users that have social media accounts spend a considerable amount on these platforms. An average Internet user spends 3 hours and 9 minutes each day on social media, and 8 hours and 10 minutes in total online. Egyptian internet users are active on Facebook, YouTube, Twitter and Snapchat which have 39 million, 34 million,  10.9 million and 4 million users, respectively (Hootsuite 2018).


eCommerce is an emerging industry in Egypt with a growing number of eCommerce sites and online shoppers. Key to the attraction of the eCommerce market is Egypt’s position as the leading Arab country when it comes to internet users.  As such new investment opportunities are opening up, further growing the market and capitalizing on the industry’s giant potential as the largest online market in Africa and the Middle East as more eCommerce startups enter this rapidly growing ecosystem.


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