Today, Daraz is regarded as one of the most popular and successful e-commerce ventures in Nepal. In March 2018, after the Chinese e-commerce giant Alibaba group, acquired the entire share capital of Daraz, major growth has been perceived one of them being the recent 11/11 campaign.
Esparsh Sarawagi from Fr!day interviews the Managing Directors of Daraz, Lino Ahlering and Jai Kavi, on the future plans and strategies of Daraz in the country.
What’s the story behind the origin of Daraz?
Lino Ahlering- In 2014, Rocket Internet, the German Investment Incubation Company, decided to focus on e-commerce models all across the world, and replicated a model of online shopping. One of the regions that was not really explored was South Asia, where there was not such focus of the main players like Amazon and Alibaba and they catered this market. My colleague, Jai was also part of this, almost since the beginning in 2015. It started with a man, and today it has grown to almost 300 people that we are now. After getting together with Alibaba, I feel we have grown much more professional, within a very short but meaningful time period.
Jai Kavi- Yes, now we have seen acute changes and huge growth, and the prospects continue in the similar manner and that’s something we can definitely look forward to.
How is Daraz moving ahead to establish itself as the leading online platform in the town?
Jai- As we mentioned, now we are having the best technologies from Alibaba, and this really sets us apart from anyone else that operates in the same industry. Today, we have AI system to make sure that our users see the product they are interested in. There’s also personalization for sellers for them to participate in most of campaigns. Marketing is all streamlined right away from when sellers decide to participate to the customer experience.
Lino- Our D-mart section has now been perceived as a replacement of your supermarket. We realize there’s a long way to go but, our prices are now matching the offline market, and even less than them in some point of time. We’re on a pretty good track, and in the last weeks, we have seen a lot of demand in the D-mart section, and that’s quite promising.
How do you assure that the customers keep coming back to Daraz?
Jai- We took a lot about engagement with our app. It’s not just about purchasing products, we’re also an environment in which trade takes place. We have messaging between customers, and sellers in our app. We also have exciting games in our app, and contests. It’s all about creating a community as well as having a mass-market appeal.
Lino- We focus on differentiated strategies, and we are still evaluating to make it better. The challenge is also to make it as wide as possible. It’s not just about one segment but, every segment, and it depends on how you address them in the right way.
Some of the challenges Daraz is facing at present?
Lino- In general, one of the main boundaries that we initially faced was about educating the audience. It was about developing trust in e-commerce, and also to make them understand that there is a credible company for this. There are also other challenges like the logistics infrastructure which is not that advanced. From our campaign of 11/11, we realized that people had to wait longer than they were supposed to, and the amount of orders exceeded 70,000 items which was really unexpected.
Jay- Online payments is also an issue. For example, at present, customers can only purchase products through cash-on-delivery, this is inconvenient for some customers. Like, if you are purchasing a phone or something of higher value, you might not have cash-in-hand. For this, we are working with local banks and finances to solve this, and will be commenced in a few months.
Since, you are new in Nepal, how do you find the Nepalese e-commerce different from where you worked previously?
Lino- Jay was working for most times in Myanmar, and I was in Pakistan and Bangladesh for most times. Every market is different to some extent. We see some overlaps but, also some differences. What is most striking is the curiosity among Nepalese here. It’s not just the young people but, also the adults are interested. After coming here, I had to understand that you not always go in the European way but, need to understand how things work locally. I am quite interested to work here in Nepal because we have a super-motivated team here, and most of them have quite good experience.
Jay- My experience is quite varied. I started off with e-commerce here in Nepal with Kaymu in September 2014 till just after the earthquake. When I joined, there were 15 staffs and after that I was transferred to different country and on and on it went. I went to London for 2 years but, I was bored there as I missed the environment here. I returned back to Myanmar, and then, the opportunity in Nepal came up and I jumped at it. It took me little while to get used to cultures at different places but, I also love this as there is always a vein of similarity.
What are some of the offers in the pipeline?
Jay- There’s a lot. We have Valentine’s campaign running right now, then the mother and baby campaign for families. We also have some exclusive phone launches coming up, D-mart with free deliveries across the valley.
Lino- Our highlight will be the Nepali New year, where our campaign will be quite big and the first big campaign of the year. Throughout the year, we will make sure it never gets boring and there will always be new and exciting deals coming up