Pakistan - eCommercePakistan - eCommerce
Pakistan is still largely a cash-based, informal economy. The majority of transactions are conducted in cash, except for those that are very large and require a bank draft or pay order. Several studies suggest that up to 60% of the economy is informal, with the majority of local companies, particularly SMEs, undocumented and outside the tax net.
A number of government departments have started to offer services via the Internet. In the private sector, 3 Pakistani airlines now offer e-ticketing and almost all local banks offer online banking services. This segment of the economy is expected to grow steadily as there are approximately 40 million Internet subscribers in Pakistan and this figure is expected double during the next five years.
There are also more than 20 million Facebook subscribers in Pakistan and several local companies now use social media to promote their products and services. Pakistan has one of the highest rates of mobile penetration in South Asia at nearly 72%, and mobile banking is an area with some promise.
Current Market Trends
E-commerce trends across Pakistan pertaining to in-market segment have remained much inclined towards electronics and mobile phones lately. Since mobile devices such as smartphones and tablets have made a vast number of choices and plenty of information available at fingertips, online customers in Pakistan are mostly interested in searching about and purchasing Consumer Electronics & Mobile Phones, followed by Employment Queries, Online Education & Counseling, Sale / Purchase & Information Gathering for Autos & Vehicles, Computers & Accessories, Financial Services, Laptops & Notebooks, Motor Vehicles by Brand, Test Preparation & Tutoring and last but not the least, Apparel & Accessories.
The e-commerce industry is profoundly impacted by the rise of social networks and the proliferation of mobile devices at an enormously large scale. Since mobile devices such as smartphones and tablets have made a vast number of choices and plenty of information available at fingertips, consumers are leaving behind traces and records of their behaviors, preferences and interests; and this report aims to capture and analyze all these trends.
With rapid evolution of technology and the advent of new and advanced software, people make use of different internet browsers to surf the World Wide Web. Different research reveal that Google Chrome is the most popular internet browser in Pakistan with 58% of the total e-commerce visitors using this software, followed by Mozilla Firefox at second place with 17% of total e-commerce visitors in Pakistan. The rest of the 25% e-commerce traffic in Pakistan comes via Android Browser, Internet Explorer, Safari, Opera, Opera Mini, UC Browser, Safari (inn-app) and Maxthon respectively. Moreover, Google Chrome, Mozilla Firefox and Android Browser also lead the list of the average session duration of e-commerce users, respectively.
Popular E-Commerce Website
Some leading e-Commerce websites in Pakistan are;
According to reports 95pc of e-companies get payments for their orders on cash-on-delivery model. This increases the liquidity requirements for e-commerce companies and also forces them to have dedicated teams that manage cash receipts for the company, thereby raising operational costs. The larger players in the e-commerce space have started to crack the code around digital payments, and are optimistic that the industry will come together to coax consumers into moving away from cash-on-deliver to online payments. Digital payments also represent a hurdle for Pakistan’s e-commerce sector. While a number of products like EasyPaisa, EasyPay, etc – mobile banks - are available today, none of them have high market penetration. This, coupled with the fact that only 16pc of the country’s population has a bank account, vastly raises the cost of doing business for e-commerce companies.
With the introduction of 3G/4G services, internet penetration has risen rapidly. Internet subscriber growth in Pakistan is averaging over 10pc per year and total subscribers crossing the 30 million mark in 2016. Cheap smartphones, low cost of 3G/4G services and a consumer-goods obsessed middle class has meant that Pakistan’s e-commerce sector is ‘mobile first’: a number of e-commerce start-ups interviewed said that over 75pc of their total order volume was through mobile devices.
Major Buying Holidays
Just like seasons have their impact on the e-commerce transactions around the world, the special occasions also greatly boost up the sales. The special occasions in Pakistan such as Eid-ul-Adha, Eid-ul-Fitr, Black Friday, New Year and Wedding Season provide great opportunities to e-commerce entrepreneurs across Pakistan for generating adequate profits and sales. The wedding season in Pakistan is usually during the months between October and April.
Similarly, during cricket world cup 2015 (end of first quarter and start of second quarter), there was larger number of sales for Pakistan cricket t-shirts, cricket bats, balls, cricket kits and accessories. Also, sales of football related products started to grow by the end of second quarter of 2014, owing to the upcoming FIFA World Cup.
Social media has been gaining vast popularity among the masses in Pakistan mainly due to Facebook, Twitter, Skype, Instagram etc. The introduction of mobile broadband coupled with the influx of affordable smartphones had a catalytic effect on the use of social media in Pakistan. People turn towards social media to voice their opinions, experiences, suggestions and feedback on any topic or constituent of the society.
Among the most popular social platforms, Facebook leads the way with more than 3 billion connections per day. It is by far the most popular social media platform in Pakistan as more than 17.2 million user accounts are estimated to be from Pakistan. Twitter is also fast becoming the preferred social media portal with more than 280 million connections per day. Google, You Tube and Instagram are also among the toppers in the list of most online hits per day.
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