Market Trends of Middle East Location-based Services Industry
Increased adoption of smart phones, social media and location-based app is expected to drive the market
- Smartphones offer constant connectivity to internet users to access location-based services with the help of built-in GPS, and smartphones can offer precise location allowing users to leverage various location-based applications. Moreover, smartphones can be used to deliver targeted advertising based on the user's location.
- The region is witnessing increased active mobile phone subscribers; according to Telecommunications Regulatory Authority (UAE), the total number of active mobile phone subscriptions in the United Arab Emirates was about 18.7 million as of March 2022, which was approximately 17 million as of March 2021. The rising penetration of smartphones is expected to drive the location-based services market in the region.
- Moreover, the increasing social media penetration has increased the adoption of e-commerce in Middle Eastern countries, which is driving the demand for LBS in the region. According to DED (Dubai), in the United Arab Emirates (UAE), e-commerce sales were expected to be approximately USD 27 billion in 2022. Between 2018 and 2022, e-commerce sales in the UAE were predicted to increase by an average of 23 percent annually.
- The rising social media users are boosting the usage of LBS applications and services. For instance, many LBS apps have social media integration which allows the user to share their location with their friends. This helps to increase the visibility of LBS apps and services and helps attract new users.
- In April 2023, Locate2u's Innovative software platform aimed to improve customer experiences and streamline last-mile delivery and home services in the UAE. The platform's real-time GPS tracking feature provides customers with up-to-date information on the whereabouts of their packages or service personnel, ensuring a seamless and convenient experience.
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The Hospitality segment is Expected to Drive the Market Demand
- The Middle East is a popular tourist destination, and the rising number of tourists is contributing to increasing demand for LBS applications that can help users in finding restaurants, hotels, and other travel-related businesses.
- Hotels and restaurants in the region are using LBS applications to help customers find and book tours, get directions, view menus and mark reservations. The region is witnessing a significant increase in the hotel occupancy rate in Middle east countries. According to Colliers International, a real estate company, the expected yearly growth of the hotel occupancy rate in Abu Dhabi was 17 percent in 2022. This was a substantial increase from the decline of 17% in the year 2020.
- Moreover, large hotels and resorts can leverage indoor mapping and navigation services to help users navigate complete indoor locations. LBS offers interactive maps, and guidance to rooms, amenities, and other facilities within the property.
- In December 2022, URBI, a Geotech company, announced the launch of a platform to accelerate business growth and city navigation in the Middle East. The company offers various services and products that support collection, analysis, navigation, and certainty to business decision-makers and consumers. Such developments are further accelerating the deployment of LBS in the middle east.
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