E-commerce Overview in Bangladesh-2017

E-commerce Overview in Bangladesh

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Prepared By:

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E-commerce: Electronic commerce, commonly known as e-commerce which consists of the buying and selling of products or services over electronic systems such as the internet and other computer networks.

Types of E-commerce: Business to Business(B2B),Business to consumer(B2C),Business to Government(B2G), Consumer to Consumer(C2C),Business to employee(B2E)

Example of Different types of e-commerce: Business to Business(B2B)

Sindabad.com

Business to consumer(B2C)

Ajkerdeal,Bagdoom,Daraz,Othoba,Amikinee,Kiksha etc.

Business to Government(B2G) Government e-shop policy in Bangladesh Consumer to Consumer(C2C)

Bikroy.com,clickbd.com,

Business to employee(B2E)

Bdjobs,Jobs A1,chakri.com

Number of e-commerce & f-commerce in Bangladesh: According to the ecommerce Association of Bangladesh (e-cab) currently there are 1000 e-commerce entrepreneurs in the country who are running their business though websites & 8,000 entrepreneurs of f-commerce who run their business with Facebook pages.[1] Registered e-cab company almost 500 .[9]

E-commerce Growth Rates & Usage Statistics in Bangladesh:

This chart will show the current growth rates, quarter-on-quarter, as of 2014 are already very high. Growth rates of over 30% quarter-on-quarter are not commonplace for most sectors in Bangladesh. The predicted growth rates for 2015 and 2016 are even higher and imply a persuasive case for more market entry and business expansion in this sector. [2] Internet

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penetration is 5% penetration, Mobile penetration is 23%, e-commerce sales: USD 38.1 millioncommerce annual growth rate: 200%+ (2013-2016) [6]

E-commerce Trend in Bangladesh: Here is the e-commerce present scenario of ecommerce in Bangladesh from (Jan, 2016 to Mar, 2017).

Source: https://trends.google.com/trends/explore?date=2016-01-01%202017-03-20&geo=BD&q=e-commerce%20in%20Bangladesh

E-commerce Delivery Ration in Bangladesh: More than 50k people are engaged with e-commerce business. [12] At present per day approximately 20 thousands & per month 5-6 lakh parcel was delivered all over the country. [9]

E-commerce Age Brackets & Statistics in Bangladesh: The current consumer demographic of E-commerce in Bangladesh is primarily made up of youth with male consumers making up the majority (75%). The most prevalent age group is 26-30 years old consisting of 50% of the consumer group. Majority of the consumers are either young professionals (44%) or university students (33%) with one-third of them has a monthly income of BDT 30K+. Fashion wear and consumer care products are the top selling categories in the market.

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[Source: Light castle partners survey on Digital Consumers, 2016, support document]

[Source: https://hifipublic.com/2015/07/12/kaymu-releases-survey-report-on-bangladeshs-e-commerce/]

E-commerce Users in Bangladesh: The most actively involved e-commerce users in Bangladesh fall under the age bracket of 25-34 years where 83% are male & 17% are female of the total activity. New online shopping visitors stand at 49% of the total traffic, while returning visitors are 51% [5] 73.5% of the respondents surveyed have bought things as varied as books or

show tickets online at least once in the last 12 months, while 13.1% have considered online shopping but have not progressed till product purchase phase yet. 43.2% of the online shoppers are occasional buyers, meaning they sometimes buy things online. About 28.7% of these online shoppers have been frequently buying things online.

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[Source: Light castle partners survey on Digital Consumers, 2016, support document]

[Source: Light castle partners survey 2016, support document]

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[Source: Light castle partners survey 2016, support document]

Only 23% of Internet Users in Bangladesh Shop Online [8]

E-commerce traffic in Bangladesh:

Over 80 percent of e-commerce traffic comes from three major cities in Bangladesh; Dhaka is top with 35% of total traffic, closely followed by Chittagong at 29%. But Gazipur in third place with 15% of the total e-commerce activity each year will come as a surprise to many. [5]

[Source: Light castle partners survey 2016, support document]

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[Source: Light castle partners survey 2016, support document]

E-commerce Transaction in Bangladesh: Bangladesh has led to a 72% growth in ecommerce transactions over the course of 2016, with business-to-consumer (B2C) accounting for 90% of all transactions. With over 60% of online shoppers between the ages of 25 and 34, the market is young and tech-savvy. [6] Cash-on-delivery is still the most popular mode of payment for ecommerce transactions. Cash-on delivery constitutes 95% of all the payments that take place, followed by bank/wire transfer (2%), bKash/Ucash (2%), and credit cards (1%). These statistics are expected to change in the next 5-10 years as regulations for online payments with credit cards mature, and overall financial literacy of citizens, increase.[source: U-Lab e-commerce report series, support document] [11] 78% of the online shoppers are low-cost item buyers. Average basket size for online shopping remains below 1000 BDT with higher concentrating in lower price groups. However, this base is to pick up as consumers show interest in trading up for their online purchases in near future.

[Source: Light castle partners survey 2016, support document]

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Bulk share of online shopping takes place before and during cultural events (like Pahela Baishakh, Bijoy DIbosh) and major religious festivals (like Eid, Puja) in Bangladesh. This finding resonates with our occasional buyer heavy respondent base which purchase/ increase purchasing things online around specific shopping seasons within a year. Quite interestingly, during sales/discounts offered by stores, only 11.33% of the respondents increase their order size and/or frequency.

[Source: Light castle partners survey 2016, support document]

10 Trending Products to Sell Online in 2017: Smart watch, Facial Mask, Phone cases, Enamel pins, Bluetooth speakers, Dad Hats, VR Products, Fairy Lights, Rechargeable Lighters, Highlighter cosmetics. [7]

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Popular e-commerce in Bangladesh:

[Source: Daraz survey 2016, support document]

Approximately 60% of the participant picked Daraz as the top site. While Kaymu being the second one with 29% of the people’s support to rival Daraz. Only 7% and 5% people chose Pickaboo and Bagdoom respectively as the top site in Bangladesh. Most 5 popular e-commerce site in Bangladesh list are given below [10]     

Daraz.com.bd (https://www.daraz.com.bd/) Ajkerdeal.com (https://ajkerdeal.com/) Bagdoom.com (https://www.bagdoom.com/) Chaldal.com (https://chaldal.com/) Rokomari.com (https://www.rokomari.com/)

Daraz.com.bd: Daraz a globally leading e-retail brand officially launched its operation in Bangladesh as daraz.com.bd, a venture by Rocket Internet one of world's largest Internet & mobile platforms.

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Founder & Chairman: Sumeet Singh Category: Daraz Bangladesh already maintain 13 category they are Men’s Fashion, Women’s Fashion, Phones & Tablet,Tv,Audio & Cameras, Computer & Gaming,Appliances,Home & Living, Sports & Fitness, Beauty & Health,Baby,Kids & Toys, Automotive & Motorcycles,Gifts,Grocres shop, Pet Suppliers. Focused Category: Electronics, Mobiles, Home & Living, Health & Beauty. Alexa ranking in BD: 37 [3] Alexa ranking in Global: 13,451[3] Daily Page view: 161,621[4] Advertisement cost per day: $485 [4] Advertisement cost per month: $14,546 [4] Traffic source: 94.4% from Bangladesh & rest of others company. [4] Negative Traffic Growth: Daraz.com.bd's recent traffic trend shows 8.43% Negative growth. [4] Website page loading time: 90% page load within 2 second. [4] Facebook like: 4,146,387(verified) Employee: approx. 40 employees (after merge with kaymu.com) Age Purchase Ratio: From this analysis we can clearly see that the majority of the people that’s highly involved are people who are in their early 20’s, which is 90% of my sample population. The second largest groups are the people in their late 20’s which is 7%. The teenagers are at 3% and out of 41 individuals that participated in the survey none of them are over thirty.

[Source: Daraz survey 2016, support document]

Gender Purchase Ratio: From the chart above we can see that there isn’t a very big gap between Male and Female user regarding their involvement with e-commerce businesses. While the male participants are 56% and the female are at 44%, just a mere 12% gap. So we can see although the men are being more involved but the women aren’t falling behind. So Daraz should continue to target both male and female as their consumers.

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[Source: Daraz survey 2016, support document]

Product Ratio: 90% original/brand Product & 10 % copy/non brand product. Membership: E-cab Member

Ajkerdeal.com: Ajkerdeal.com is the largest online shopping mall and a sister concern of bdjobs.com (recently bdjobs has sold their 25% stake to the Australian number one job portal SEEK international at 38.5 crore. [19]) & beshto.

Founded: 2011 Founder & CEO: A K M Fahim Mashroor Category: 35 main categories. Investment: Fenox Venture Capital, 10 crore [15] [16] [17] Innotech [21] Total Product: More than 100000 products Merchants: More than 2000. Focused Category: Those product which price is tk. 99 to tk.1999, Very cheap Gadgets Items Alexa ranking in BD: 150 [13] Alexa ranking in Global: 38225 [13] Daily Page view: 57,137 [14] Advertisement cost per day: $171 [14] Advertisement cost per month: $5142 [14] Page | 12

Traffic source: 90% users come from Bangladesh. [14] Positive Traffic Growth: 1.60% [14] Website page loading time: 90% page loaded at 4 sec. [14] Facebook like: 456,976 Regular Delivery: Around 1000 [17] Employee: 150(approx.) Age Purchase Ratio: Middle class, 18-36 year. Ajkerdeal Agents: 12 districts. [18] Order Ratio: 70% order comes from outside Dhaka. [18] Ajker deal Facebook Statistics: [20] Gender Purchase Ratio: Male 80%, Female 20% Product Ration: 80% replica/copy product & 20% brand product. Membership: E-cab Member.

Bagdoom.com: ‘Bagdoom.com’ as the new identity of ‘akhoni.com’. Bagdoom.com has been designed with splendid experience of purchasing online with more fun and more exciting Bagdoom.com has arrived with more convenience, ease and better experience of online shopping.

Founded: 2010 Co-Founder & CEO: Syeda Kamrun Ahmed Category: 4 main categories. Men, Women, Electronics, Home & Living. Focused Category: Fashion & Lifestyle & e-store Alexa ranking in BD: 650 [23] Alexa ranking in Global: 83,235 [23] Daily Page view: 28,650 [24] Advertisement cost per day: $85.95 [24] Advertisement cost per month: $2,578 [24] Traffic source: 86.9% come from Bangladesh. [24] Negative Traffic Growth: 55.49% [24] Website page loading time: 90% page complete with 7sec. [24] Facebook like: 832,694 (verified) Bagdoom Facebook Statistics in Bangladesh: [22] Employee: 15-20 Age Purchase Ratio: Teenage 18-28 Page | 13

Order Ratio: 200+ daily orders Gender Purchase Ratio: Teenage specially girls. Membership: E-cab Member.

Chaldal.com: Chaldal.com is an online grocery shop in Dhaka, Bangladesh.

Founded: 2013 Co-Founder & CEO: Waseem Alim Number of Customer: 45000 registered [26] Investor: Sajid Islam [27] Category: 12 ( Fruits & vegetables, Meat & Fish,Cooking,Beverages,Home & Cleaning,Pest control, Office products, Beauty products, Health products, Pet care, Home appliances, Baby care)

Total Product: 5 million. [26] Focused Category: Grocery product Alexa ranking in BD: 660 [28] Alexa ranking in Global: 129,463 [28] Daily Page view: 38,657 [29] Advertisement cost per day: $116 [29] Advertisement cost per month: $3,479 [29] Traffic source: 96.3% from Bangladesh. [29] Positive Traffic Growth: 48.32% [29] Website page loading time: 90% complete at 5 sec. [29] Facebook like: 159,372 Chaldal Facebook Statistics in Bangladesh: [30] Average Basket order size: $20 [26] Employee: 350 officers [25] Warehouses: 5 [25] Age Purchase Ratio: All (specially worker women) Order Ratio: 600 0rder per day. [25] [26] Sales growth: 50% [25] 300-400% growth in every six month. [26] Membership: E-cab Member.

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Rokomari.com: Rokomari.com is an e-commerce venture of “Onnorokom Group Web Services Ltd”, a sister concern of Onnorokom Group.

Founded: January 19, 2012 Founder & CEO: Mahmudul Hasan Sohag Category: Book Total Customer: Around 15k [32] Total Sell: 60 lakh [32] Total Product: More than 30K [31] Focused Category: Book (local & foreign) Alexa ranking in BD: 190 [33] Alexa ranking in Global: 49,759 [33] Daily Page view: 46,106 [34] Advertisement cost per Day: $138 [34] Advertisement cost per month: $4150 [34] Traffic source: 83.8% [33] Negative Traffic Growth: 11.94% [34] Website page loading time: 90% page load at 2 sec [34] Facebook like: 1,950,667 Age Purchase Ratio: All ages people Rokomari Facebook Statistics: [35] Membership: E-cab Member.

Some Important Facts in e-commerce & f-commerce [36]:        

49.3 % people are very positive to purchase product from e-commerce 72.0% people go online using mobile phone & wifi connection. Age groups between 19-24 & 25-40 spend highest amount of time online. The people of Dhanmondi spends more time than Uttara,mirpur & Gulshan. About 70.8% visit e-commerce sites between one & five times a month. Higher income groups and Dhanmondi respondents are the most likely to visit ecommerce sites compared to respondents in other locations. 69.3% purchasing products online one or two times a month. Transaction sizes for e-commerce purchases are still relatively small. About 70.5% of ecommerce users spend less than BDT 5,000 a month. Page | 15

 

29.3% people using a website compared to 43.5% who used a Facebook Page for purchasing products online. 16% order counting as a fraud in this business. [Survey research on 400 people]

Age group & Gender Fact in e-commerce /f-commerce: All 424 respondents [Survey research on 424 people] within the target age group of 20-35 years answered to the Yes/No question of online shopping. Among them 247 (58.3%) were male and 177 (41.5%) were female. Total 281 (66.3%) participants have already shopped online and only one-third of the surveyed population (143 people, 33.7%) has not done any online shopping at the time of the data collection. Total 262 respondents were from the age group of 20-25 years and 68.3% (176) have shopped online. On the other hand 63.5% (129 out of 203) people in the higher age group of 26-35 have already shopped online. The number of non-online shopper is higher in the higher age group, 36.5% compared to 31.7% in 20-25 years of age group. This ratio supports an argument that upcoming credit holders in Bangladesh are more perceived towards online shopping. In terms of gender, more male (37.1%) are shopping compared to female (29.1%).

Suggestion: As we already know most of the big big company already run their own e-commerce so it is very difficult to survive in these sector. But e-commerce is a very profitable & long lasting business. So in B2C model like us there are so many competitor we have they are Amikinee(BTI),Othoba(Pran-Rfl),Daraz(Rocket Internet), Ajkerdeal(Bdjobs),Rokomari(Onnorokom group),Kiksha(Ananto group) & so on. If we look at B2B there are only one well known e-commerce company named Sindabad.com (concern of Ananto group). There is also another market leader named Pickaboo.com (concern of Symphony) they only sell electronics, Onnorokom.com (concern of onnorokom group) they only sell book. So if we choose to select one item to sell so that we can easily target our targeted audience & make our own brand identity like pickaboo, chaldal, onnorokom.

Limitation: E-commerce is a new era for our country so it’s a matter of sorrow that I got few data in web & the other e-commerce company employee are not ready to publish any company data to their competitor. So that I tried to level my best to complete the analysis of E-commerce overview in Bangladesh. I hope you pardon my mistakes & realize the scarcity of data collection. As per you know there is a time limitation so it is very tough to collect exact data within a short period of time.

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References: [1] The Daily Star: http://www.thedailystar.net/business/tradeshi-ties-alibaba-e-commerce-1291180 [2] Dhaka Tribune: http://archive.dhakatribune.com/business/2016/jan/31/e-commerce-bangladesh [3] Alexa: http://www.alexa.com/siteinfo/daraz.com.bd#?sites=daraz.com.bd [4] Free website report: http://www.freewebsitereport.org/www.daraz.com.bd#est-dtl [5] Prothom alo: http://en.prothom-alo.com/economy/news/71583/Youths-mostly-active-in-Bangladeshe-commerce [6] Payza Blog: https://blog.payza.com/e-commerce/country-spotlight/country-spotlight-understandingconsumers-cross-border-e-commerce-bangladesh/ [7] Payza Blog: https://blog.payza.com/e-commerce/industry-trends/10-trending-products-sell-online2017/ [8] Future online/

startup:

http://futurestartup.com/2016/07/20/only-23-of-bangladeshi-internet-users-shop-

[9] Banik Barta: http://bonikbarta.net/bangla/news/2016-10-07/89883/%E0%A6%87%E0%A6%95%E0%A6%AE%E0%A6%BE%E0%A6%B0%E0%A7%8D%E0%A6%B8%E0%A6%96%E0%A6%BE%E0%A6%A4%E0%A6%A8%E0%A6%BF%E0%A7%9F%E0%A6%AE%E0%A6%A4%E0%A6%BE%E0%A6%A8 %E0%A7%8D%E0%A6%A4%E0%A7%8D%E0%A6%B0%E0%A6%BF%E0%A6%95%E0%A6%89%E0%A6%AA%E0%A6%BE%E0%A7%9F%E0%A7%87%E0%A6%9A%E0%A6%B2%E0%A6%9B%E0%A7%87-%E0%A6%A8%E0%A6%BE/ [10] News39: http://news39.net/%E0%A6%AC%E0%A6%BE%E0%A6%82%E0%A6%B2%E0%A6%BE%E0%A6% A6%E0%A7%87%E0%A6%B6%E0%A7%87%E0%A6%B0%E0%A6%85%E0%A6%A8%E0%A6%B2%E0%A6%BE%E0%A6%87%E0%A6%A8%E0%A6%B6%E0%A6%AA-%E0%A6%AC%E0%A6%BE-%E0%A6%87/ [11] e-cab blog: http://blog.ecab.net/%E0%A6%AC%E0%A6%BE%E0%A6%82%E0%A6%B2%E0%A6%BE%E0%A6%A6%E0% A7%87%E0%A6%B6%E0%A7%87-%E0%A6%87%E0%A6%95%E0%A6%AE%E0%A6%BE%E0%A6%B0%E0%A7%8D%E0%A6%B8%E0%A6%83%E0%A6%8F%E0%A6%95-%E0%A6%A8%E0%A6%A4/ [12] e-cab blog: http://blog.e-cab.net/ecommerce-orthonitike-aro-canga-korbe/ [13] Alexa: http://www.alexa.com/siteinfo/ajkerdeal.com#?sites=ajkerdeal.com [14] Free website report: http://www.freewebsitereport.org/www.ajkerdeal.com

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[15] Future Startup: http://futurestartup.com/2015/12/06/fenox-venture-capital-launches-in-dhakaannounces-200-million-fund-for-local-internet-startups/ [16] Future financing/

Startup:

http://futurestartup.com/2016/06/27/ajkerdeal-raises-undisclosed-amount-new-

[17] Future startup: http://futurestartup.com/2016/07/30/fahim-mashroor-on-ajkerdeal-ecommerce-andinternet/ [18] Future Startup: http://futurestartup.com/2016/12/19/inside-ajkderdeals-big-plan-take-e-commercebeyond-dhaka/ [19] Future Startup: http://futurestartup.com/2012/02/19/fahim-mashroor/ [20] Social bakers: https://www.socialbakers.com/statistics/facebook/pages/detail/1501510493482910ajkerdeal [21] Pitchbook: https://pitchbook.com/profiles/ajkerdeal-profile-investors-funding-valuation-and-analysis [22] Social bakers: https://www.socialbakers.com/statistics/facebook/pages/detail/193946357317792bagdoom-com?country=bangladesh [23] Alexa: http://www.alexa.com/siteinfo/bagdoom.com#?sites=bagdoom.com&sites=ajkerdeal.com [24] Free website report: http://www.freewebsitereport.org/www.bagdoom.com [25] Daily sun: http://www.daily-sun.com/post/147214/ecommerce-in-Bangladesh-has-enormous-growthpotentials [26] Future startup: http://futurestartup.com/2016/06/07/waseem-alim-of-chaldal-part-one/ [27] Fsindex: https://fsindex.co/organizations/chaldal-com [28] Alexa: http://www.alexa.com/siteinfo/chaldal.com#?sites=chaldal.com [29] Free website report: http://www.freewebsitereport.org/www.chaldal.com [30] Social Bakers: https://www.socialbakers.com/statistics/facebook/pages/detail/138658759653540chaldal?country=bangladesh [31] Prezi: https://prezi.com/v--5dybpvp5x/rokomaricom/ [32] Dhaka courier: http://www.dhakacourier.com.bd/rokomari-com-making-a-difference-for-books-inbangladeshi-e-commerce/ [33] Alexa : http://www.alexa.com/siteinfo/rokomari.com#?sites=rokomari.com [34] Free report: http://www.freewebsitereport.org/www.rokomari.com

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[35] Social Baker: https://www.socialbakers.com/statistics/facebook/pages/detail/164315863670362rokomari-com [36] Financial express: http://www.thefinancialexpress-bd.com/2017/02/06/61136/A-closer-look-at-ecommerce-in-Bangladesh/print [37] Alexa: http://www.alexa.com/siteinfo/quickbuy.com.bd#?sites=quickbuy.com.bd [38] Free website report: http://www.freewebsitereport.org/www.quickbuy.com.bd

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