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The biggest pitfall of e-commerce in South Asia

Delivery is the biggest problem faced by e-commerce players in South Asia, reports Tech in Asia

Junayed Mustafa / Tech in Asia 

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The e-commerce wave is moving fast in the South Asian region. We are seeing billion dollar and lot’s of funding in seed stage startups in this continent. Giants like Alibaba are investing in e-commerce market. e-commerce sites are moving from web presence to mobile. Every commodity is moving into online. Unlike India and Pakistan, other regions of this belt (ex: Nepal, Bangladesh, Myanmar, Cambodia) are experiencing the tip of the iceberg now. e-commerce were there a couple of years back, but now the entrance of MNC’s is creating competition with existing local players as well as building the market faster than the local ones resulting increase in order and delivery response rate.

I would like to point out the biggest problem the e-commerce players are facing in South Asia right now. Can you guess what this is?

It’s not an online payment gateway and access to credit cards. It’s not a widespread wifi network throughout the country. It’s not a fake customer order or high operation and marketing cost.

It’s delivery.

The biggest pitfall of e-commerce in South Asia

Cash on delivery changed the avenue of shipment method in India and Pakistan and it still accounts for 95% of delivery for online stores. I am not just explaining it from the experience collected from Bangladesh. But also from the similar experience gained through my conversation with the colleagues and friends in Nepal, Myanmar and other neighbouring countries.

Buyer may choose a mobile payment system offered by the Telco and banks, but still cash on delivery system is ruling over them. Customers are still not so savvy ordering product just by seeing pictures, rather they would want to check it first. At the same time sellers also prefer cash on delivery as it’s the most convenient method for closing orders and increase customer satisfaction.

The author, Junayed Mustafa, is Head of Sales for Kaymu Bangladesh Ltd. He is a tech business enthusiast, digital marketer and sales professional.

This is an excerpt from Tech in Asia. You can read the full article here.

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First Published: Fri, September 11 2015. 14:37 IST