With talks of AliBaba entering Pakistan, the hype around e-commerce is reaching fever pitch. According to projections, the industry will cross $1 billion by 2020. However, there are significant challenges that must be overcome if it is to reach that milestone. We’ve documented them quite well on this publication in the past.
Today, however, we’ll be talking about opportunities and one in particular: events.
Black Friday, Cyber Monday and others are familiar terms for most of us now. Celebrated mostly in the West, these shopping festivals offer incredible discounts for shoppers. Last year, Pakistani e-commerce stores also followed suit and spent millions on marketing – and conducting – Black Friday. We also saw the mega Google backed Online Shopping Festival and smaller events throughout the year.
So it’s pretty clear that online retailers are aware of the potential of events and want to take advantage. However, their current strategy is flawed. The problems are two pronged: one is of execution and the other is of localization. Let’s discuss them and then take a look at how to do it right from neighboring India and China.
The Problem with Shopping Events in Pakistan
To start off, discounts on any shopping festival in Pakistan have never rivaled those offered in the West. You might be able to snag a good deal but you’d be in the minority. Naturally, that creates friction between the stores and customers. Black Friday in Pakistan last year was subject to a lot of criticism with people lambasting all stores for unimpressive discounts, limited inventory and sluggish site performance. Clearly, there needs to be more planning and a coherent strategy in place to satisfy a significant number of shoppers on events like these. “Underestimated the response” isn’t an excuse that can be used more than once or twice.
Next comes localization. How many Pakistanis were aware of Black Friday before millions were spent on creating awareness for it? Even those who were familiar with it were bemused at online stores copying the exact lingo since Friday is a holy day for Muslims and calling it ‘Black’, which is a cultural byproduct of the events’ history in the US, carries a negative connotation.
All the awareness created for the event, all the marketing and hype was in essence, reinventing the wheel. Why? Because in absence of the hype for Christmas, which is why Black Friday became popular in the first place in the West, it’s just another day for everyone in Pakistan. Retailers could have picked literally any day of the year and it would have received the same response.
The mistake was ignoring our culture, our heritage and the festivals we do celebrate. E-commerce stores need to evaluate consumer behavior patterns in Pakistan and take advantage of the ebbs and flows and sync them with their own sales timings. It’s not even a hard thing to do since literally every kid above five knows when their family always shops. Eid-ul-Fitr sees Pakistanis spend billions of rupees each year. Ramzan is celebrated with great zeal in this country. Aside from these, seasonal promotions for when schools start and weddings are being arranged, are only some of the possibilities that exist and are ripe for the taking.
Taking a Page Out of China & India’s E-Commerce Playbook
If I am being honest, the failure of e-commerce stores in getting this right is baffling. India and China are the largest e-commerce markets in the world and some of their most successful events aren’t Black Friday or Cyber Monday, they’re based around local and cultural festivals.
In India last year, Flipkart’s Big Billion Sale and Amazon’s Great Indian Festival Sale were organized around the Navratri festival in India. Similarly, Snapdeal promoted one category each day for a week and even named its shopping festival after the Indian festival of Diwali. The logic is that people are naturally going out and spending record amounts of money on these occasions so why not take advantage of the this easily identifiable spending pattern instead of promoting a day that holds no significance to the local populace?
Similarly, in China, Singles’ Day has become famous for breaking e-commerce records each year with tens of billions of dollars in sales. The origins of the its name and the date it occurs, 11/11, are as follows. The number 1 represents a single person and Chinese youth use the 11th of November to celebrate their bachelorhood, sort of like an anti-Valentine’s Day. Chinese retailers took this opportunity and marketed 11/11 as a day when single people could take advantage of massive discounts and treat the most important person: themselves. The result? Singles’ Day is the largest shopping festival in the world and its sales last year surpassed $17 billion in 24 hours.
What E-Commerce Stores Need to Do
The solution is simple enough. We already have a culturally diverse population, festivals that bring us together irrespective of our beliefs and a burgeoning and upwardly mobile middle-class that is poised to ensure e-commerce becomes a billion dollar industry in the coming years. So instead of promoting festivals and sales on days that mean literally nothing to us, use those that do.
Organize sales around Eid-ul-Fitr. Do it on 14th August. Drop discounts on 23rd March. Offer irresistible prices when school season starts. Tempt the bride and groom during events in wedding season in Pakistan. The operating keyword is localization.
I am certain that if e-commerce stores start to take advantage of this opportunity that’s untapped till now, they’ll be well on their way to higher sales, better customer perception and all the good press that goes alongside it all.