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Pakistan’s e-commerce trade wooing global investors

Pakistan’s e-commerce trade wooing global investors

The Pakistani e-commerce market is alluring the interest of international investors. and are some of the most successful and popular Pakistani ecommerce websites developed by Rocket Internet (GmbH), the world’s leading online venture builder. Pakistan recently signed a Memorandum of Understanding (MoU) with the world’s largest e-commerce company, Alibaba, to promote the country’s exports worldwide by Small and Medium Enterprises (SMEs) through e-commerce. Under the deal, Alibaba, Ant Financial and the Trade Development Authority of Pakistan (TDAP). TDAP agreed to foster growth of worldwide exports of products by SMEs in Pakistan through e-commerce. The trend to use internet has been growing fast in Pakistan for the last one decade. As the trend grows faster, traditional business is being converted into internet business where all transactions are done online, from selection of product to payment of bills. The business on the internet is less costly and more beneficial. It is becoming very popular mode of trading around the world particularly in the West.

E-commerce is actually the business done through the internet in the present era of modernization and technology. The rapidly growing usage of internet is shifting the world towards the e-commerce. Phenomenal advancement in Information and Communication Technology (ICT) has not only brought a revolution in the life styles of the people but also in the business and marketing strategies of the people. Today, a company creates, maintains and optimizes business relations with consumers and other businesses using tools and practices involving internet technologies. This is precisely e-commerce, which is an information technology trend developing fast in the business world. It includes selling, buying, advertising and contacting buyers with credit card or digital cash, by transfer of data between different companies using internet through online facility.

With a population of around 200 million individuals, Pakistan has the potential to become next major internet market in terms of number of connected people in the next few years. According to one estimate, 9 percent of the country’s population went online during last year while another 30 percent are likely to get connected to internet in next three to five years. Presently, there are roughly 30 million internet users, who are the focus of entrepreneurs in Pakistan. The arrival of 3G and 4G mobile networks is further strengthening the trend towards e-commerce in the country. According to one estimate, the total volume of online sales was around $35 million last year. A race seems to have started among young Pakistani entrepreneurs market share pushing sites to offer better services and driving up the number of customers.

Though Pakistan has a lot of scope for growth of e-commerce, yet it still faces enormous challenges. There is lack of awareness among the masses regarding e-commerce. Most of the people consider online transactions as a risky activity. Some people strongly believe in physical dealing. People are accustomed to the traditional mode of shopping – they go to the market, visit shops, bargain to get a good deal, and return home with the product. A change in this trend is slowly taking place. The customers and businesses have begun to switch to e-commerce, providing new experience of shopping. The people seem to be adopting e-commerce trend. Online transactions have had an impact in the past few years, convincing more consumers to digitize their shopping experience. The country’s e-commerce industry must be regulated in order to provide a set of defined rules to the corporate sector and the local business community for carrying out e-commerce business processes. The government must announce a comprehensive policy to promote e-commerce in the country. The government should make taxation rules for e-commerce.



The officials claim that e-commerce may surpass $1 billion in 2020 due to exponential growth in mobile broadband access. Pakistan is leading in mobile banking transactions in South Asia with 11% of citizens using mobile phones for financial transactions. The country’s e-commerce industry is estimated at $100 million with about 30 million internet users. The digital platforms have not only changed the economics of doing business across borders by reducing costs of international transactions enabling Micro, Small and Medium Enterprises to connect with customers and suppliers around the world but has also promoted inclusive economic growth and have provided livelihood for the marginalized segments of the society.

The e-commerce industry has high growth prospects in Pakistan. The industry is set to flourish at a faster pace if the government takes serious measures to remove barriers hindering its growth and expansion. Presently, customer satisfaction is gradually gaining trust amongst customers. Pakistan needs to place ICT on its priority list to keep pace with the advancement in technology and minimize digital divide. The government needs to take measures for creating a conducive environment for technological innovation and its effective use in trade and commerce.

Co-founded by three individuals Usama Arjumand, Akhter and Saad, Shopsy is a ‘Google for online shopping. The co-founders with a diverse combination of specialties are active to change how Pakistani people shop online. Shopsy presents a customer with various versions of a product they’re looking for available on multiple online stores in Pakistan. At the backend the website is essentially a web crawler which scrapes data from Shopsy’s partner sites and displays to the user relevant search results. A customer can search a product, adjust the price range, compare products and then be directed to the actual online store which sells the product.

Presently, Shopsy claims to have the fastest-performing search engine in Pakistan and its database currently includes over 100,000 products of 20 partner sites with which they work via affiliate marketing. Every time a customer directed from Shopsy buys a product from one of its partner sites Shopsy gets a cut. Their stint at Telenor Velocity has given them access to Telenor’s 40 million subscribers and data analytics highly suited for customer profiling and targeted marketing. In the five months since joining Telenor Velocity the startup has witnessed a considerable increase in their site activity. In the last few months, Shopsy was able to get exclusive deals advertised via SMS and on Telenor’s very own Wowbox, which is a lifestyle application for all Telenor Pakistan users. Shopsy’s monthly visitor count has increased considerably from an initial 10,000 monthly visitors. It is currently focusing on increasing its user base. It is making efforts to become a marketing channel and support system for local e-commerce stores. Shopsy could be well on their way to become a go-to place for avid Pakistani shoppers.

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