February 5, 2018

Boutiqaat: Creating a Social Commerce Market in the Gulf

Image of the Boutiqaat app.

Social commerce is a new phenomenon. In “The Social Commerce System,” it is defined as “the expansion of e-commerce in the social networks on the Internet, in which social factors are significant, and consumers use the right to create content through the media via forums, ratings, reviews, and recommendations on different platforms.”

At its core, Boutiqaat is similar to other e-commerce platforms such as Amazon, Alibaba, and Souq. However, Boutiqaat incorporates a distinguishing social element: It features Gulf and Arab social media influencers who add their favorite products, allowing consumers to shop directly from these influencers’ virtual stores inside Boutiqaat. Having started as an e-commerce cosmetics and goods distributer in Kuwait, Boutiqaat has rapidly expanded to become the largest application for cosmetics, skincare products, and perfumes in the Middle East.

AGSIW spoke with the mind behind this social commerce platform, Abdulwahab Al-Essa, a renowned television anchor and political debate moderator. He co-founded Boutiqaat with Faisal Al-Shayji in 2015.

AGSIW: How did Boutiqaat come about?

Abdulwahab: Boutiqaat started in 2015. It is the first well-organized social commerce platform in the world where the focus is on peer-to-peer economy. We saw a potential in social commerce and decided to start this unique concept. In 2011, I created Omedia, a marketing agency for social media influencers, and my work there was going well. I then decided to open up a few restaurants, some of which weren’t successful. Running Omedia, I naturally made social media influencers advertise for restaurants, but in many cases these ads weren’t bringing in customers. When I looked at the comments section for the restaurant ads, which were posted on Instagram, I noticed people commenting on the influencers’ sunglasses and other things that they were wearing, rather than the restaurant itself. Many times, these items are not readily available in stores in Kuwait or are out of stock. I then started to think about bringing these demanded items to people. This is how Boutiqaat began.

AGSIW: Investors, like Boubyan Petrochemical Company and others, saw the success of Boutiqaat and wanted to own a portion of this young company. At the end of January, Boutiqaat signed a 13.65 million Kuwaiti dinar (approximately $45.56 million) investment with Boubyan Petrochemical Company. What does this investment mean to Boutiqaat’s growth in the market?

Abdulwahab: It is intended to allow Boutiqaat to broaden its scope into the international markets and this is a vision we’ve always had for the company, as our main objective is to open a new market beyond the Middle East. Our strategic partners like Boubyan Petrochemical and others will assist in our expansion to open up in Asia, Europe, and the United States.

AGSIW: Why does Boutiqaat only offer beauty products?

Abdulwahab: The idea of selling items from different categories is challenging. We couldn’t start our business with everything at once. The juiciest category to start with, with a concept like this, was cosmetics and other small goods that are used by female social media influencers. There was also a lack in the Middle East of the latest cosmetic products. Most e-commerce platforms in the region were focused on fashion and electronics. No one was in the cosmetics industry; we saw it as an opportunity.

AGSIW: What conditions do you think facilitated your success in this business?

Abdulwahab: I am a young Kuwaiti entrepreneur who is not from a wealthy family and had nothing to lose when it came to making a high-risk investment. I don’t have a fortune or an inheritance to worry about and save, so I find myself in an easier position to take such risky opportunities. Whereas, others would approach low-risk investments, such as real estate and development projects. I would add to that the connections I made as a TV anchor and a known figure on social media.

Online platforms made it easier for people like me (and others) from the middle class to have a venue for their innovative ideas, especially with concepts that are difficult to implement offline like Boutiqaat.

AGSIW: What has been the main difficulty for you running Boutiqaat?

Abdulwahab: Hiring talented people. The Middle East is weak in attracting talents in the IT [information technology] sector who could run the company. Trying to hire people from abroad is difficult because many still believe the Middle East is an unsafe destination to start a sustainable career in.

AGSIW: What distinguishes Boutiqaat from other e-commerce platforms?

Abdulwahab: Most successful e-commerce businesses in the Middle East are alternative versions of American or European concepts. Boutiqaat is an original concept that is entirely made in Kuwait and my hope is that youth will stop looking for examples and start creating new ones. Online concepts are more connected to cultural and social behaviors, unlike offline. Creating something from scratch that matches our society will have a greater potential than replicating concepts from abroad in our region.

Follow Abdulwahab on Twitter and check out Boutiqaat’s application on the Apple Store.

Mai Al-Farhan is a research associate at the Arab Gulf States Institute in Washington.