MISSION STATEMENT”

“Make it Easy to do Business anywhere in the Era of Digital Economy”

INTRODUCTION:
Daraz was launched in 2012, by Muneeb
Maayr & Farees Shah at the based venture
builder, Rocket internet. Its an online fashion
E-commerce market place that offers diverse
assortment of products to online customers /
shoppers / & consumers. Daraz is also
functional in south Asian markets i.e.,
Bangladesh, Myanmar, Nepal & Sirilanka. Daraz an online marketplace / Mall offers a vast
variety of every product along with it is concentrated on superior customer satisfaction &
experience inclusive of a user – friendly interface that provides access to customers with
ease. Daraz offers a vast variety of products in different genre’s including Smartphone, TVs,
Home appliances, Computers, Gaming consoles, Cameras, Sporting goods, Men’s Fashion,
Women’s Fashion, Home – Living Furniture, Audio theatres & Video accessories. Daraz has
become a common brood name in the region with over 2 million products, 5 million
customers & 30,000 sellers. Daraz hosts over 300 brands & 500000 products. An average
taken by the study to analyze daily complaints registered in Daraz through calls are about ~
10,000. More over on peak days calls recorded are over 30,000+ for queries. Daraz offers a
nationwide delivery straight to customer’s place either office or home with payment methods
that are convenient to the customers.

Competitive dynamics & brand positioning

Daraz’s backend systems crashed due to rush of customers on the busiest sales campaign of
the year i.e., ― Black Friday ― & 11.11 sale. Due to over load of customers the website
crashed & the application became extremely slow &unresponsive. Customers were unable to
view product images. Although Daraz has a hybrid IT network, running its applications
virtually through a third-part data center. It all happened in November 2016, but various
complaints of the same nature occurred in recent years as well. An estimated traffic on
website calculated (24 Apr 2017) was worth of $ 3.3 million US Dollars. A study conducted
to calculate Daraz’s Monthly Revenue is around $ 100,000 & Daily Revenue is about $
3,333.
Creating, managing brand equity
Creating customer value & customer relationship.
As Daraz is focused on providing quality & superior customer service experience it is now
using AWS (Amazon Web Series) for cloud storage. Automated response for tracking order
& boost productivity. Studies shows that less time a customer has to wait to hear the order
status, the happier they are with the call. Head of customer service Gheerbrant says, “We
were able to shorten the duration of such calls by more than 40%.” Which ultimately had a
positive response on customer service. After each call, Daraz customers are asked to fill a
survey form which evaluates degree of satisfaction with the response of call from company.
He says that now he is able to train customer service agents on more complex issues that
would be the subject of remaining 20% calls.

Consumer perception
Daraz can improve its consumer’s perception & brand equity by increasing the cost of
infrastructure. By tracking & improving call center metrics for better performance. It can
automate the process of informing their customers about the delivery process. One of the
Daraz’s flaw which de-motivates their customers for shopping through them is that they do
not deliver various products ordered at one time synchronized. There are a lot of unwanted &
irrelevant advertisements on the website that irritates customers. Out of stock products are
also listed on the website, so when a customer order’s an item with high expectations & it’s
out of cost it disappoints & create a negative impact on consumer’s perception.

Analyzing consumer markets

Identifying market segments & targets
Daraz’s mainly targets on the people aged between 14 – 45+, it includes all type of customers
i.e., youth, children, adults & earners. It mainly focuses on literate people who are aware of
online shopping & internet users whom have access to the facility. Mostly urban residents are
targeted for easy delivery & logistics.
Customers buying behavior depends on some of the factors listed here. Psychological factors
i.e., motivation of customers to buy from Daraz based upon reviews, cost & highlighting or
hype of the product. In some cases, it may vary when the client settles on its own decision of
buying anything independently on its own understanding or something that he/she is used to
buy on personal factors. Socioeconomic factors also play a role in buyer’s conduct. At some
point a gathering of individuals or a loved one’s suggestion effect the decision of purchasing
in this web - based era of life, culture societal position. These all contribute to a customer’s
choice of purchasing any product.
Segmentation, targeting, & positioning.

Daraz considered all internet users in the region as their potential customers. While majority
of the customers are located in big cities & of urban sector. The proportion of gender-based
target audience vary as women have a higher proportion of fashion – related items / products
while men’s show more interest in electronics & sports gears.
Convenience is the biggest factor that customers are towards E – commerce or online
shopping trends. Daraz actively monitors the listed prices of products to ensure that prices are
up to the mark of products & its quality. Customers are easily able to compare the prices of
different sellers of the same product on the website. Daraz has about 13 major categories of
product including 1200 subcategories, it is seen as a virtual mall.

Consumer learning/ consumer attitude formation

In this era when daily approximately 250+ new ventures make their way in the market, Daraz
has to follow a strategy that will not affect its reputability or customers with a new entrant.
Daraz needs to create loyal yet regular & happy / satisfied customers by increasing service
quality. Some of the factors that are serving as barriers to Daraz’s growth & establishments
are listed below.

Quality:
They really need to work on product quality & ensure customers about it. Even if they have
lower number of sellers but the product quality is good customer will shop from them longer
and will not switch to other ecommerce sites easily. In order to achieve this their products
must be of good quality, matching their brand’s image &n goal.

Faster delivery time & logistics:

Being Daraz not having their own delivery team, they are scuffling to deliver faster on
emergency deliveries. As the company has grown bigger with time it needs to create a strong
personal delivery team and better follow-up teams to ensure timely deliveries. Customer buy
from online to save their time. If that purpose is not served it becomes pointless for them to
shop from Daraz.

Fixing any complaint registered sooner to build customer’s trust:

After complaining and returning default product, if customers will get prompt service action
and the mistakes are fixed effectively than there is a high chance that they will repurchase.
More over, they will trust the company that it cares about their problem and always willing to
fix it, in order to fulfill their need. They will feel valued and will stay loyal to the brand
which ultimately result in a positive feedback from the customers.

Product strategy, services & pricing

For pricing strategy, company should be aware that their prices of the product should match
the current market prices. The pricing should be competitive enough to persue customers for
purchasing from Daraz. If the price of a certain product is high, there should be a valid
reasoning to it. Such as the quality of the product must be high though for this quality
assurance is mandatory.
Services
Massive complaints are registered from customers that they are unsatisfied with the customer
service, which means that the customer service representative (CSR) was not available,
follow – ups for the order were not done properly, prompt replies were not given to the
customers in response to their problems. Enough information about the products is not
provided. More over the product delivery status is often not provided swiftly from the
outbound team of Daraz supply chain as a result, the service is delayed. A large sum of calls
and queries are received every day. So, to resolve this problem the number agents should be
increased to ensure effective and prompt service from the department.
Product strategy:
Another way of acquiring loyal customer base is offering unique products & offers in the
market. Offers & deals should be one of a kind so that customers will automatically be
attracted towards Daraz like that the
one they offered 11.11 sale.
In addition to these offers Daraz has a
new category launched recently other
than electronics & apparels, i.e.,
FMCGs. It has launched DFresh,
where customers can buy fresh
vegetables & fruits online at
discounted prices. This service now is
only functional in some cities i.e., Karachi, Lahore & Islamabad. It provides Express delivery
in which products get delivered the very next day fresh & ripened. Daraz through this facility
offers items that are not readily available in local markets i.e., Avocados, colored peppers &
berries in export quality.
Daraz mall an official channel of Daraz, offers a flagship store collection of branded
authorized sellers. It added 20 Turkish apparel brands to it so that consumers can browse
foreign fashion trends from the comfort of their homes.
Marketing Strategy:
Daraz offers membership ID to the customers for purchase above 100k & up to 10 %
discounts on Eid, Black Friday sales and other regional events. Every company / brand has a
plan to enter the market with an innovative strategy, Daraz launched online campaigns,
vouchers, Discount cards & promotions on different social networking sites to enter the E-
commerce industry.

Integrated marketing channels, managing retailing wholesale:

Social marketing strategies are different than normal marketing strategies where customers
are attracted to buy the product through various modes of marketing. For social media
marketing certain strategies are built to engage customer with the brand & create a
communication level with the consumers. Daraz has apps in play store where buyers can get
all sorts of information & purchases. Daraz also uses Facebook, Twitter & YouTube as their
social media platform to promote their brand. They interact with customers on these
platforms & answers their queries regarding products.

For example:
Daraz created a poll for the price of a brand-new product launched to assume the price from
customers & whoever gives the right answer will get a certain discount on that product or
vouchers.
Through agent marketing Daraz is creating a social network chain between customers & the
brand, where agents place orders on behalf of the customers inclusive of commission.

Main part of social media marketing is engagement process. Customers should stay engage
to the brand to create a long run relationship & trust with it. For this strategy Daraz shares
various pictures of products & asks opinion from customers.
Amplifying customers is another way of marketing. Daraz offers discounts, deals & vouchers
to the audience if they like or share the content of their page & promote it among their
friends. It’s a new way of gathering new customers / visitors & creating a large social
network for the brand.

Logistics Management
Daraz offers a nationwide delivery services straight to customers place either at home or
office with payments methods that are convenient to customers. Umer gul the head of
Daraz’s Logistics said, ‘We are the marketplace for 3PL providers. Daraz’s logistical
operations are managed by AIGx, an RI company. It’s an integrated network of logistics
which provides e – commerce companies order fulfillments with time tracking for the orders.
The transportation is conducted by Daraz’s own supple of forty-five riders, deployed only
in Tier 1 cities, or through courier services (TCS), Leopard and Overseas courier service
(OCS), employing around 4,000, 3,000 and 700 couriers with having more or less the same
regional coverage. Daraz has warehouses in Tier 1 cities which were Karachi, Lahore and
Islamabad; Hence, maintaining two categories of seller owned inventories: fast-moving
products, which Daraz wanted to stock at the warehouses to achieve shorter delivery lead-
times and second, the inventory maintained as a foremost service for the strategic sellers who
were unwilling to take up a substantial role in the delivery process.

Out of the integral, 80 % of the inventory is sustained in Karachi & 15 % in Lahore,

leaving Islamabad’s proportion to nominal. None of the items were kept at the warehouses
for more than 45 days, so that items not sold within 45 days were returned to the sellers.

The warehouse operations are divided into four

functions:
Receiving (responsible for offloading)
Inbound (responsible for barcoding)
Inventory (responsible for storage)
Outbound (responsible for order preparation
and dispatching).
Daraz has different models of delivering & preparing customers orders in the ware houses,
The cross - dock model is for the sellers who are not yet designated as the trusted sellers &
for those who are either new or have negative reviews. When an order is placed, the item has
to be picked up from the seller’s warehouse and underwent an extended operational cycle
involving inspection, packaging and sealing at Daraz’s warehouse by its team before the
delivery.

The drop-ship model is for the trusted sellers, who got verified for this status based on their
past working history with Daraz, prepared and packed the ordered items on their own. The
vendor operations team coordinate with the sellers and AIGx to ensure that the orders are
packed and delivered as required. Once the seller had notified that the ordered item is ready, a
rider from Daraz or a 3PL provider o pick up that item in a sealed form for direct customer
delivery.
Returning/Rejected Orders
If the customer did not open the package at the point of delivery and refused to accept, the
item is taken back by the rider and returned to the source warehouse through the delivery
cycle in reverse. Other than that, the customer will have a 7-day time scale to return the
purchased item by informing the customer service. The item to be returned has to be picked
up by a Daraz rider in Tier 1 cities, whereas in other cities, the customer has to deliver the
item itself at one of the 800 TCS outlets for TCS to return it to Daraz Warehouse & handle it.