E-commerce is an increasingly viable sales channel for U.S. companies in Saudi Arabia, with Saudi consumers gravitating towards online shopping and payments. According to McKinsey & Co, e-commerce currently constitutes 10 percent of total retail sales in Saudi Arabia and is expected to grow to more than 25 percent by 2035.
Saudi Arabia’s e-commerce channel is primed for continued growth. By end of 2025, the number of Saudi internet users for e-commerce (selling and buying) is expected to reach 34.5 million, an increase of 45 percent from 2019. Key drivers behind this growth include a tech-savvy young population, one of the highest smartphone penetration rates in the world, a higher-than-average mobile broadband internet subscription rate, and a higher-than-average internet speed when compared to other countries. Amazon.sa remains the largest international entrant, active since June 2020, while Noon, Jarir, Jahez, HungerStation, Salla, Zid and other local e-commerce platforms dominate the Saudi market. Importantly, the Saudi Arabian Government is taking steps to strengthen Saudis’ confidence in e-commerce and to spur the use of e-commerce platforms by strengthening the country’s e-commerce regulatory environment to protect consumers and companies.