• Friday, Sep 24, 2021
  • Last Update : 08:39 am

In a recovering economy, Daraz is betting consumers will spend tens of crores on its platform in a single day

  • Published at 10:48 pm November 10th, 2020
Daraz 11.11 poster 2020
An advertisement of Daraz’s 11.11 sales extravaganza on a building’s façade in Dhaka Courtesy

The Alibaba-owned e-commerce site has elaborate plans for its 11.11 sales extravaganza

A decade ago, the date ’11.11’ was just a numerical alliteration for much of the world outside of China. 

But thanks to Chinese e-commerce behemoth Alibaba, the 11th day of the month of November has gone on to become the world’s biggest shopping event, drawing in hundreds of millions of people across the globe.

Since 2018, that day is fêted in Bangladesh too thanks to Alibaba’s acquisition of Daraz in May that year.

This year, Daraz has upped its ambitions from the occasion: it has put up billboards all over Dhaka city to publicise the shopping extravaganza and is holding out for sales in the neighbourhood of Tk 25 crore in the first hour alone and upwards of half a million deliveries that day, said its Managing Director Syed Mostahidal Hoq.

To put Daraz’s expectations into perspective centring on that day, the e-commerce platform makes about 50,000 deliveries a day normally at present.

“We started our preparations early this year -- in July,” he told Dhaka Tribune yesterday.

This year, the platform will have 1 crore products from 33,000 sellers, up from 40 lakh from about 18,000 sellers last year. 

On November 11, customers will be able to avail large discounts on the 1 crore products showcased on Daraz’s marketplace.

There will be pre-paid discounts, a “Tk 11 Mystery Box”, an undisclosed item one can purchase at the cut-price of Tk 11, and free delivery on specific brands and products.

A 15 per cent discount will be available for cardholders of Brac Bank, City Bank, Eastern Bank, Mercantile Bank and Standard Chartered Bank and a 15 per cent cashback on payments made through bKash.

Home appliances, smartphones, televisions and fashion products are expected to sell well this year, according to Hoq.

Keeping that in mind, Daraz has tied up with Motorola, which will make its re-entry to the Bangladesh market after a gap of 10 years with the Moto G8 Power Lite model, a smartphone that got great ratings globally for its long battery life, aesthetics and affordability. 

The phone will be available exclusively on Daraz from Wednesday at Tk 14,999. 

Daraz will also launch affordable handsets from Realme, while there would be discounts on Samsung mobile phones.

Customers will also have the chance to win a Toyota Aqua when they play a “1 Taka Game”.

To drum up excitement for the sales extravaganza, Daraz has been running a pre-sale campaign from November 4 to November 10, when select products would be available at prices lower than what it would be on November 11.

Last year, Daraz’s sales soared 12-13 times from that on normal days, according to Hoq.

“This is big for a country where only less than one per cent retail sales come from e-commerce.” 

Daraz, whose previous financier was Germany’s Rocket Internet, does not disclose its sales figures as part of its current company policy. Alibaba’s 11.11 sales figures, which is said to have totalled $38 billion last year, includes the sales of its subsidiaries, including Daraz.

“We got a good response in 2018. And last year, it was better. But this year, it would be the best.” 

In 2019, sales amounting to about Tk 13 crore was made in the first hour of the 11.11 campaign, up from about Tk 6 crore in 2018, according to Hoq, who has been with Daraz since 2015.

This year, sales would be three-and-a-half times more than last year’s 11.11 campaign, which started out as a quirky celebration of Chinese singlehood in 2009.

As he began building Alibaba, co-founder Jack Ma harboured designs of having a shopping promotion centring around a holiday, drawing inspiration from the tradition of US retailers offering mega-discounts on the day after Thanksgiving, known as Black Friday. 

He zeroed in on 11.11, a day that was celebrated in Chinese university campuses from the 1990s as a toast to being single in a culture where young people face heavy parental pressure to get married -- an antidote to Valentine’s Day.

Early on, consumers were urged to treat themselves in celebration of being single. Soon, China’s rising middle-class turned that into a phenomenon. Now, all demographics are being targeted.

Whether this year’s event logs in even higher sales remains a big doubt seeing the country, like the rest of the world, is very much in the thick of the global coronavirus pandemic, which has curbed the spending power of a large chunk of the population.

But the Daraz Bangladesh MD is optimistic.

His logic being, people would be more interested in bargains given their reduced purchasing power now.

Besides, the enforced switch to online sales thanks to the countrywide shutdown between March 26 and May 30 has led to a huge growth in e-commerce, with people turning to online marketplaces for groceries and kitchen items, which they did not do before.

Last year, Daraz, which was set up in 2014 and traces its roots to Pakistan, made deliveries of 20,000-25,000 a day on average. That number doubled to 50,000 this year.

Not that Daraz was not put in a tight spot by the countrywide shutdown and the disruption in the international supply chain to flatten the curve on coronavirus.

Deliveries were tricky and many people saw their income reduced for pay cuts and job losses. It lost many import-dependent merchants, which it compensated by bringing on board more than 10,000 local retailers in May.

“Bangladesh has more than 10 crore internet users, so there is an immense opportunity for the e-commerce platform to grow and expand.”

Keeping that in mind, earlier in June, Daraz announced its plans to invest Tk 500 crore by 2021 to set up logistics infrastructure and hubs that would help expand its footprint to all 64 districts.

As part of that plan, Daraz is transforming 150 villages in all 64 districts into e-commerce hubs in the line of Alibaba’s Taobao Villages in China.

The Taobao Villages are rural e-commerce hubs that feature Alibaba's logistics, service and training to encourage farmers to engage in online sales of farm produce and local specialities.

“Our challenge is to ensure that the Daraz Villages get broadband internet connections as village people don’t use smartphones,” Hoq said, adding that Daraz is also building warehouses and ramping up its collection points across the country from the existing 130 to 300.

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