With rapid evolution in the online retail industry in Pakistan along with its challenges and fallouts, e-commerce is the tipping point for businesses and consumers alike
Online retail may have only appeared a virtual fantasy to common sensibilities until recently. But its fate changed rather dramatically and people began to take it for the real thing. With the staple use of plastic money and the growing internet, people have now cottoned on to the convenience of online shopping. Why trail through crowds and lug heavy bags home when the virtual cart can just do the job better.
While the world has been reaping the benefits of online businesses for almost a decade now, retail investors in Pakistan were always reluctant in capitalising on an industry that majorly depends on the availability of internet. Though not anymore. According to PTA, by December 2014, there were over 31 million internet users in Pakistan and about half of them accessed it through cell phones. And so, with the long-awaited arrival of 3G and 4G technology coupled with the popularity of smartphones that has led to a ‘mobile-commerce’ revolution, Pakistan pictures a fertile field for investors.
This does not still mean you can have Amazon deliver at your doorsteps tomorrow. For now, we have Daraz.pk, Kaymu.pk (both are sister Rocket ventures), Olx.com, foodpanda.com, eatoye, carmudi, zameen.pk, tcsconnect.com, umall.pk, symbios.pk, ishopping.pk, payless.pk -- all of these are large virtual shopping palaces that catalogue items ranging from home electronics to clothing to mobile phones to gourmet food and also home grocery.
And where Rocket ventures are moving ahead with the aim of being the e-bay for Pakistan, some very successful ventures operate from only a spare room.
However, each one of these e-commerce sites has carved its own niche and serving to a different clientele that also keeps overlapping occasionally. Some visitors are only interested in the most economical deals, some only wish to scrap old items while some just want to save themselves the toils of visiting the shop. And even though all of the e-commerce giants have pitched their carefully executed commercial strategy online, the competition is tough.
Thanks to the way things function online, businesses exactly know who their customers are, what they are looking for, if they are happy with the products or not and where can you target your prospective clients. This is one unique edge online marketing has over the traditional. And hence its chances of engaging its right audience are overwhelmingly high.
Other than these huge retail stores, most of the traditional brands in Pakistan -- big or small -- now have their online set for e-transactions. A few years back, women would flock outside designer lawn stores waiting for hours to get the best designer lawn suits. Today, all they have to do is click them to the cart, and have it delivered at their doorsteps in a matter of few days. Moreover, many websites, including kaymu.pk, now have the options to get monthly rations and individual grocery items right at your place which would soon presumably put an end to compulsion of lining up in long queues and waiting for your turn.
However, all is not pink. The online retail in Pakistan faces a host of challenges not many countries have to counter.
The first and the primary is the payment mode. Even though for Pakistanis cash on delivery is the rule, it costs relatively higher due to the sensitivity around cash handling. Some of the more economic options are online payments, express delivery and shipping via Overland. The general fear is that there is an armada of hackers waiting out there to intercept buyer’s credit details and empty his credit card before any online patrol could rescue. It may have been true a decade back but times have changed. Most of the banks now in Pakistan have the technical facilities to make online shopping safer, if not safest. Standard Chartered, UBL, HBL and even other smaller banks extend outstanding support and customer services for online businesses.
"I frequently shop online and haven’t gone to the market for quite sometime now. I know many people who don’t have time for it. I’ve always used credit cards and never been a victim of fraud. So any tales about it are old. Online shopping is now perfectly safe," says Tahir, a site-engineer who is always on call with barely enough time to stroll through the marts. He is happy buying online and complains of no online mishaps.
The steep illiteracy curve is another major challenge that has discredited the convenience e-shopping has to offer. Where the surprisingly good part is that a major portion of online sales comes from outside the three major cities, which shows e-shopping is not just an urban notion, order placement and confirmation becomes an issue. A wrong order placed can’t be blamed for a wrong delivery. Most of the complaints arise from a difference in expectation and the received product. Saad Khan, an accounts manager at a multinational e-commerce venture, says, "Complaints are usually about wrong delivery. When we go at the back-end, these people have in fact placed exactly what they have received."
At times illiteracy is a roadblock in the way of achieving customer satisfaction, while at times it is the seller who falls below the mark when it comes to the promised quality. Arbash, a regular online shopper, bought an expensive water-proof mobile only to find the mobile set couldn’t survive five minutes in the bathtub. "It took me a few days but I got complete payback so I’ve no sour feelings over it. It could have happened to me in the regular market place too, so I can’t really blame online shopping for it."
There is another critical problem at hand here. Some of these websites used photoshopped products with very cheap price labels and flossy details. The bubble is popped once the real thing reaches your door and it just looks atrociously inferior from what you ordered. Saimaa, a regular online shopper, shares her story, "When you get plain satin in the name of silk, you’re bound to revolt against the seller who sent you that. I knew I’ll get my money back but what about the frustration of ordering and finding out you were set up to settle for less."
Hajra, another shopper with a sorry experience, says, "I ordered a pack of 5 Maybelline lipsticks for Rs999. I thought it was a good deal I should just grab. After I took the delivery, it took me no time to figure out it wasn’t the brand I opted for. It was a replica." Even though Google does ban websites making copyright violations, it is usually late. "If online sellers sincerely intend to build buyers’ trust, honesty is essential or their businesses will die their own death."
"Moreover, what I find to be a fundamental flaw in online business is the time factor. Even the fastest deliveries at least take somewhere from two days to a week’s time to be delivered," says Hajra.
With rapid evolution in the online retail industry in Pakistan along with its challenges and fallouts, e-commerce is the tipping point for businesses and consumers alike providing both with multi-channel shopping and selling experience that too with the added charm of convenience and cheaper operating cost.