According to Chris G Christopher Jr., contributor at the Supply Chain Quarterly, the economic and social impact of e-commerce activities in a country can be defined as “E-commerce has altered the practice, timing, and technology of B2B and B2C markets, affecting everything from transportation patterns to consumer behaviour.”
As the Head of Performance Marketing at Daraz Asia, Alibaba’s newest South Asian e-commerce venture, I can only attest to the power of e-commerce in shaping the economic, social and even cultural outlook of a country.
However, as cliched as it may sound, establishing an e-commerce presence in a country and getting it off the ground is easier said than done. The level of marketing and customer understanding required is a mammoth task to undertake. It is an uphill task but the rewards are exceptional.
You must be wondering why my words should be given any importance, right? Do 7 years of core Digital Marketing experience across international e-commerce startups change your opinion?
I’m not flaunting my acumen for digital marketing here. I’m trying to prove a point: I’ve seen the transformation of the digital landscape first-hand, in Pakistan as well as abroad, especially the growth of e-commerce, catapulted by Daraz Asia. No wonder it attracted Mr Ma’s attention.
So how did we make Daraz a success – something worthy of Alibaba’s investment? Well, today I will discuss what factors determine an e-commerce startup’s success.
Daraz started out as a humble online “fashion” store in Pakistan, back in 2013. After a couple of years, it branched out into electronics and held the country’s “first” Black Friday, amid much religious controversy. Since then, Daraz Black Friday has virtually become sort of a national event, heavily anticipated by people across the country, from large metros to sub-urban towns and even rural areas.
Case in point: The 2017 Daraz Black Friday became Pakistan’s first billion-rupee e-commerce sales event. The number of searches related to Black Friday, as per Google Trends, has grown exponentially.
So, how has Daraz’s marketing strategy evolved over the years to support continued growth year over year? Well, let’s have a look
E-commerce in Mature vs Immature Markets
Even in mature markets like China, initially, it had only one big event to its name: Black Friday. This was a one-off marketing blast that resulted in a huge spike in traffic, orders and daily active users, as shown in the graph below.
However, as the Chinese market became more and more mature, it realized that continued growth cannot be sustained in the long-term through single blasts like Black Friday. The reason for this logic was fairly simple one: Marketing blasts or events, such as Black Friday, used to feature discounts by prominent banks and payment gateways. This, in turn, encouraged the general population to take that “first plunge” into e-commerce and getting a taste of it.
That’s why Daraz started adding an increasing number of events to its portfolio, such as Pakistan Day, Fashion Week, Mobile Week, Independence Sale, Great Online Shopping Festival, HBL Shopping Gala, New Year Sale and Black Friday. This expansion of events scattered evenly across the calendar year helped Daraz achieve sustainable growth in orders and new users over time. A similar event calendar of China’s e-commerce market is shown in the graph below.
The Marketing Factor
Since the various aforementioned marketing blasts/events were a necessity for Daraz’s growth, the marketing team started putting a greater and greater budget behind these blasts. For example, the biggest event of Daraz, Black Friday, registered a 4x budget growth from 2015 to 2018.
On the other hand, the Pakistan Day Sale registered a budget growth of almost 8x from 2016 to 2018. This goes to show how much each marketing blast is being converted into a stand-alone event to ensure continued growth throughout the year.
The Not-So-Secret Weapon
We extensively used Google’s entire suite of Advertising solutions to enhance our reach and ROI. Check out the stats below that highlight Google’s potential.
Some of the targeting techniques we used for marketing blasts at Daraz were:
Using affinities and consumption patterns to target generate awareness among people based on their interests and habits – this has increased 15% accuracy now that Google has integrated data from PlayStore, Maps and Search Engine
Using past google searches of consumers to determine their e-commerce intent
Using remarketing and similar audiences to reach people who were most likely to make a purchase
The Campaign Marketing Plan
As we got more adept at our game, we devised three stages in which we used to divide all our marketing efforts
Awareness Creation – This is the phase where we created hype about the upcoming marketing campaign using YouTube bumper ads as well as display and search ads
Capturing Intent – These are actual campaign days where we used YouTube TruView for Action Ads, Google Display Campaigns, Dynamic Remarketing & Prospecting, and extensive Search Ads
Harvesting Momentum – This is the part that we internally referred to as the “Milking” phase, whereby the campaign has ended but the hype is still there so we used Dynamic retargeting and Search ads to target people who are already aware of Daraz and have the intent to convert
Special care was taken to develop segmented marketing strategies for both genders. As 80% of Daraz’s audience is M/F under 35 years, with a nearly 40-60 female-to-male split, we developed separate ad campaigns for both, complete with their appropriate budgets.
For example, Daraz’s female audience is more in-market for Apparels and Accessories while the male audience focuses more on Phones and Electronics. Therefore, appropriate affinity categories were created to target these segments accordingly.
The Next Phase
The culmination of all these marketing strategies has come in the form of an outright acquisition by Alibaba. The e-commerce industry of Pakistan is embarking on a new journey where better prices, wider assortment and faster delivery times will become a reality. We are expecting even more marketing blasts this year, especially focusing on the relatively untapped but substantial suburban and rural population.
E-commerce has already taken the country by storm, changing consumer buying behaviour in the process. The acquisition of Daraz by Alibaba has made a significant economic impact as well. These very promising times for Pakistan’s e-commerce industry!