Innovation is an imperative for business, but in retail innovation as an ecosystem is the driver of growth that will benefit all players. Mohamad Mourad, Managing Director & CEO, Cenomi Group, shared his thoughts with Cyrille Fabre, Senior Partner, Bain & Company Middle East, on how moving from a product-centric to a brand-centric experience can enhance opportunities for businesses across the sector.

The traditional retail ecosystem in Saudi Arabia was the mall. Malls create an environment where customers can come, meet their favorite brands and enjoy convenient shopping experiences. The emergence of e-commerce created an alternative to malls, allowing consumers greater convenience to a wide range of products. However, e-commerce in Saudi is broken.

Lead times for delivery are too long. Prices are not great. Product ranges are not exciting. And brands don’t want to engage in online marketplaces because the customer experience is so poor, and they don’t want to dilute their brands. Succeeding in e-commerce means succeeding in four different areas: price, convenience, product selection and customer experience. And no one brand can do all that and remain economically viable.

The challenge and the opportunity in Saudi is to build an e-commerce solution that delivers a brand-centric mall experience, not a product-centric department store experience. To bring retailers together in an ecosystem where they can offer their full inventory; where customers can first select the brand they want to buy from and then select the items they want. And to support that with same-day delivery on in-store pickup, regardless of whether you buy on the platform or direct from the brand itself.

To do this requires an investment in digital and physical infrastructure which no individual brand or retailer can take on. But as an ecosystem we can create an online experience that gives customers unlimited access to all the retail in the country, available on delivery on pickup or in any way the customer wants.

The product centric marketplace has not worked. There is a need to unify all the ecosystem companies under one brand and take a very bold move that will benefit the entire sector. It’s not going to happen overnight, but someone has to do it. Cenomi must be the one to do it since it will benefit from it the most given its leadership position in the Saudi market.