Understanding the Effects of Social Media and Mobile Usage on E-Commerce: An Exploratory Study in Saudi Arabia

IntroductionE-commerce adoption and implementation in developed and developing countries have been carefully studied with focuses on consumer behavior and/or business issues. However, little is known about the evolution of E-commerce in Saudi Arabia (Abed, Dwivedi, & Williams, 2015). Recent studies (Alghamdi, Nguyen, & Jones, 2013; Almousa, 2013; Khan, 2014) have reported factors that motivate or inhabit the evolution of E-commerce in Saudi Arabia focusing on either businesses or consumers. This paper will review and examine the effect of social media and mobile usage on E-commerce in Saudi Arabia.E-commerce is vital for many businesses to remain in competitive markets; it is also an important economic growth factor (Abed et al., 2015; Cheng, 2015). E-commerce purchase growth in the MiddleEast and North Africa (MENA) is 45% in 2014 according to the Payfort's report (Al-Khalidi, 2015) and the growth is estimated to reach about 52% in 2020 (Al-Khalidi, Abdalla, Soudodi, & Syed, 2015). The overall market value for MENA in 2014 is about $7 billion. The market value for United Arab Emirates (UAE) is about $2.3 billion (32.8% of MENA's value), and the value for Saudi Arabia is about $1.5 billion (17%). The estimated market value growth for MENA in 2020 will be $13.4 billion, UAE $4.4 billion (the same rate at 32.8%) and Saudi Arabia $2.9 billion (a higher rate at 21.6%) (Al-Khalidi et al., 2015). However, according to another recent article in paymentweek.com, E-commerce in Saudi Arabia grew only 30% in the past year (Cheng, 2015). Those imply that the E-commerce growth rate in Saudi Arabia is slower when compared to MENA and UAE, despite its fast growing economy, the rapid increasing on internet usage and the very strong purchasing power in the country. Several studies have also pointed out the slow evolution of E-commerce in Saudi Arabia (Abed et al., 2015; AlGhamdi, Drew, & Al-Ghaith, 2011; AlGhamdi, Nguyen, Nguyen, & Drew, 2012; Almousa, 2013; Telecommunications Predictions 2014 Middle East, 2014).A recent report indicated that internet growth in the Arab World have increased significantly in the past decade to 400% (Khalidi, Soudodi, Syed, & Abdalla, 2014). According to another report published by Sacha Orloff Consulting Group, computer and internet access for Saudis reached 65.8% of population (de Kerros Boudkov Orloff, 2012). The rate of mobile possession in Saudi population has also outstandingly grown to 1.8 to reach 95% of residents (Alsenaidy & Tauseef, 2010). The universality of mobile devices opens the door for companies to consider mobile commerce (M-commerce) for online purchasing or at least for marketing purpose (Abed et al., 2015). Similarly, there is remarkable growth in social media usage in Saudi Arabia. Statistical reports and information graphics about social media usage in Saudi Arabia put it the top of countries in the region and in the world (Schoonderwoerd, 2013).The inadequate volume of research focusing on current issues conducted to study E-commerce in Saudi Arabia and the lack of large assortment statistical reports create a chance for further research (Abed et al., 2015; Ahmad & Agrawal, 2012). Some common factors reported previously by other research may be diminishing nowadays (Makki & Chang, 2015). Other factors, such as social media and mobile usage, could be considered for further studies. In fact, mobile internet access overtook personal computers for the first time worldwide in 2014 in several markets including India, China, and Saudi Arabia. More research related to mobile and social media could result in more reliable findings (Abed et al., 2015; de Kerros Boudkov Orloff, 2012; Makki & Chang, 2015).In this paper we study the effects of social media and mobile usage on E-commerce in Saudi Arabia. A comprehensive online survey was developed for our qualitative approach to gather Saudi consumer's perspective on E-commerce and the survey was distributed by utilizing the social media. …