It is a well-known fact that the e-commerce industry is growing all around the world. Specifically speaking, there has been a rise in online shopping in Pakistan. However, we don’t see the other side of the same story. There are so many challenges that come with this growth which the players in this very industry have to tackle to ensure that all of us are getting the convenience that we need.
Daraz the leading online shopping platform in Pakistan has been seen to put forth a stand which rests on ownership of the problems faced by the average person and then presenting a concrete solution to it.
The people of the country face a lot of issues with respect to timely deliveries. A lot of the customers are hesitant in ordering from online platforms due to expected delays in their product deliveries. To combat this, Daraz has launched its very own e-logistics company, DEX. Through this they have taken a hold of 65% of the total deliveries and are ensuring that the customers are getting the most efficient service as possible. It is also easier for Daraz to keep a track and locate the riders, as it is their own, which has greatly helped the case of late deliveries.
Additionally, we see that payment methods and limited payment options make it harder for consumers to shop online. A lot of platforms in the country, whether they’re functioning through a website, an app or even a social media page, rely on the payment method of handing cash on delivery. Many a times the rider would come to the doorstep of the customer and find that they’re not at home. A situation like this causes a delay in the customer receiving the package. It is also important to note that the functional habits of a consumer are also evolving. Many people now prefer cashless transactions due to the ease that comes with it. Following through on this phenomenon, Daraz has introduced the concept of Daraz Wallet and the options of prepayments.
Daraz Wallet allows customers to keep money in the form of credit on the app and use it to make purchases when needed. Moreover, the shopping platform has partnered with banks like HBL and Standard Chartered to allow for customers to make prepayments and carry out hassle free transactions. Daraz has also partnered with Visa to allow for its customers to avail discounts. It is praiseworthy to note that Daraz is targeting the varying segments in our country by having so many payment options available to allow for a customer to have a smooth shopping experience. Within a year – from September 2019 to September 2020 – Daraz has faced double the orders that were paid through prepayments; from 16% to 32%.
Apart from the logistical problems and the narrow payment options, there are also some very real challenges that an e-commerce company has to face. All relationships require trust to survive. Similarly, Daraz has stringent policies in place to make sure that the customer trust is kept. It hosts two types of customers; the sellers that are on their app and the buyers. A customer of Daraz would want their journey to remain as smooth as possible, which is both affected by their purchase journey as well as how legitimate the seller and their products are on Daraz.
The buyer can ensure that their pre-purchase journey is smooth by making use of the research tools that Daraz offers. For any product that you want to purchase on Daraz, you are able to read the ratings and reviews of other customers. This can help you trust the authenticity of the product as well as provide you with relevant information to help your decision-making process. Moreover, as a customer, you’re able to communicate with the seller through instant messaging before you make your purchase. This option is very user-friendly. It is admirable that we have the option to clear out any queries that we may have with the seller himself. If the customer has queries relating to the app or any other questions which the seller can’t answer, they have the option to converse with Daraz itself. in this option, Daraz representatives will resolve any and all confusions that you may have.
Now that we have outlined and secured how you can make the most out of your pre-purchase journey, let’s move on to the part when you’ve placed the order for your product. God forbid, if you receive an order that is faulty, Daraz has the option for you to make a return within 7-14 days of purchase. If one has ordered something below Rs. 750, Daraz has the possibility of a complete virtual refund and in this case the customer gets to keep the product as well. All these measures are kept in place to allow for maximum customer satisfaction. The most noteworthy policy is that Daraz has the option of return pickups. They realize the pain of the customer when they have received the wrong order and do not want them to go through extra trouble. For this very reason, they have incorporated the option of return pickups in Karachi, Lahore and Islamabad thus far.
Daraz experiences a very large order volume. In the month of September, out of the 2 million items that were delivered, only 2.5% of them were returned. The complaint per order is also, only, 0.7%. These figures give us a holistic picture of how almost all of the orders are rightfully delivered and received.
As mentioned earlier, a customer’s experience is also affected by the seller and their behaviours. Daraz has outlined very strict policies to certify that the sellers are in fact genuine. Initially, the company gives each individual the benefit of the doubt. They want to empower the entrepreneurial culture in Pakistan and create employment opportunities for the masses. However, Daraz does not shy away from taking bold steps against the bad sellers. Daraz provides seller education to all those that sell on the platform through Daraz University. It is making efforts to pave paths for the good sellers to grow and prosper with Daraz.
Once a seller has been onboarded, there is a scorecard which each seller is measured against. It has three metrics; out of stock (OOS) rate, quality return rate (QRR) and processing and fulfilment time - this process is measured as how long it takes for the seller to accept the order, pack it and drop it off with the logistical partners for the delivery to take place.
Daraz takes weekly actions to catch the high cancelation items and remove those from the platform. This is a very important measure as even if the seller has an overall low OOS and does get caught in the scorecard, their SKUs which have a high cancelation rate, will get blacklisted from the app. It is commendable how Daraz is identifying the loopholes which were present in older policies and are rectifying them to secure customer satisfaction at all touchpoints.
To highlight some statistics and provide concrete evidence, it was reported for the month of October that Quality Return Rate for sellers was only 1.5% whilst the processing and fulfilment time was less than 2 days.
As a result of the checks kept, Daraz has temporarily delisted 4400 sellers in September on the basis of the QRR while permanently delisting 5000 sellers to unclench the seller fraud buzz that was going on.
Additionally, Daraz has taken measures to combat delivery fraud. They have implemented the use of serialized flyers that allow for the company to track the package at any point. This enables greater security and ensures that the package is being delivered to the right individual. Daraz has also revised their contracts with their logistic partners to include the clause of payments being made to them on the condition that they deliver the package to the customer.
We should acknowledge the efforts of Daraz for facing the challenges that come their way with a head-strong attitude. It is not easy to take actions against your very own sellers who are in fact, Daraz’s customers. The consumer attitude is evolving towards online shopping and so, the difficulties that businesses face as an e-commerce company are also on the rise. However, Daraz has kept checks and policies throughout all customer checkpoints to certify that the customer is having a seamless experience.
