Awok: The E-commerce Giant That Shook Dubai and Faded Away

Once a household name in the e-commerce landscape of the UAE, offering affordable items across various categories such as fashion, electronics, and home essentials, Awok was once a popular brand that played this particular space to optimize its offerings. Launched in 2013 as a revolutionizer of online shopping in the UAE and beyond, Awok quickly rocketed as one of the most preferred go-to options for customers when looking to save money. It did so despite raising considerable funding in 2019. Global financial issues forced the firm to close its doors in August 2020. What inspired its fast ascent and fall? Let’s dig into the story of Awok’s journey in dynamic world of e-commerce.

They specialized in clothing, fashion accessories, kitchenware, home appliances, consumer electronics, and beauty products. Selling them at very cheap prices, Awok drew a fantastic number of customers in no time, and soon became one of the renowned leaders in e-commerce in the UAE and Saudi Arabia.

One of the major reasons why Awok gained success was that it was mobile-centric, ensuring that online shopping was reachable to more people than ever before. Aiming for mobile shoppers with the introduction of the smartphone, Awok launched easy-to-use apps and web sites that help in swift turnaround in managing products for customers in transit. It exercised a business model, keeping affordability as its core business. With around 70,000 products available in more than 30 categories, Awok was well poised to be the number one e-commerce channel for locations established there. Affordability and seamless shopping experience helped Awok gain a considerable share in e-commerce within the UAE. The courier fleet owned by Awok enabled the company to maintain consistency in quality of service over which it had full control, thus providing timely delivery. Vertical integration was necessary for maintaining customer satisfaction amid mounting demand for efficient delivery.

In April 2019, Awok hit a milestone when it accepted funding of $30 million from a set of investors. The new round of funding would be used to further the expansion of the company and to develop its private label, which would enable it to offer unique, exclusive products for further differentiation in a fiercely competitive e-commerce marketplace. With these investments, Awok aimed to double its logistics infrastructure and add more strengths to its offerings with a view to becoming a major e-commerce player not only in the UAE but across the MENA region. The company had grown to about 700 employees and was running their own fulfilment centre and logistics, which was helping with cross-border sales for more than 120 countries’ customers.

Despite the fast rise and grand ambitions, it was no sooner than a few months after bagging the $30 million investment that Awok began to face financial constraints. June 2019 reports hinted at the fact that it had stopped paying its creditors- its suppliers, logistics partners, and even some employees on its payroll. Such instability in its books had waves of scepticism come through, and discussions over the operations of the company started. Although the reasons for these financial troubles are not very clearly spelled out, it’s well known that the cost of running an e-commerce business is typically rather high, both in terms of supply chain management and logistics and marketing. Owning such a large number of delivery vehicles in Awok’s case, operating its own warehouse, and keeping prices low, no doubt weighed their books too heavily.

A shocker was the announcement by Awok that it would close its shop without prior warning. The company stated that a global financial meltdown was the reason for shutting down. Most people were shocked because just recently, funding had been provided to the company and even planned to expand. The site and apps turned off, keeping both customers, suppliers, and employees in the dark. But the closure of Awok revealed a pain point for the e-commerce sector in an increasingly competitive landscape such as that in the UAE, though the company had managed to assemble a loyal customer base via its pricing model.

The rise and fall of Awok make for a fascinating story to be told about the fast world of e-commerce. While it was successful in establishing a brand that many customers learned to rely on for inexpensive goods, the firm ultimately buckled under the weight of financial pressures resulting from the speed at which the business expanded and the vagaries of the global economy. The history of Awok is reminiscent of all the pains of building a successful e-commerce business. This is highly competitive industry with high operational costs and obsessive innovation to remain ahead of the game. The bolder the plans of Awok, the sharper is what could be learned about maintaining profitability through a feasible financial model and being resilient in times of turbulence in markets.

Even though it is no longer active, the impact Awok has had on the landscape of e-commerce in the United Arab Emirates is, without a doubt, spectacular. The company pushed boundaries by bringing more people into the world of online shopping and challenged competitors to follow suit. In the process, Awok paved the way for the growth of the UAE’s e-commerce market and proved that there is always room to innovate, create something new, and work upon it.