KARACHI: Pakistan’s online consumer economy is growing rapidly along with the diverse middle class and in three years the e-commerce sector is expected to surpass $1 billion.

Using Amazon as an inspirational example, this has created a growing trend in online shopping websites in Pakistan like Daraz.pk, Kaymu.pk and Yayvo.com.

These online marketplaces are tapping into the growing consumer market by providing customers with everything they could possibly need, ranging from beauty and electronic products, hotel bookings and home appliances and furniture to everyday groceries.

Daraz.pk Managing Director Zain Suharwardy told Dawn on Saturday that their web traffic had grown almost three times the amount vis a vis last year as well as online orders and last year Daraz and Kaymu merged, further expanding their customer outreach.

“There are certain categories that perform really well for us during Ramazan, starting off we have groceries because people need to stock up on the essentials and men’s fashion has been a big success for us this Eid. From the branded range to the cheaper range and this is because 50 per cent of our customer base is male,” said Mr Suharwardy.

With the use of 3G and 4G smartphones, the proportion of digital shoppers is expected to boost online shopping. Currently, over 75pc of the total order volume is through mobile devices. Karachi, Lahore and Islamabad are the main three cities generating online business but orders are placed from all over the country.

Second tier cities like Gujranwala, Multan or Sialkot where retailers do not have a physical presence and there are no mega malls; also account for high online traffic.

Head of Yayvo.com, Adam Dawood, told Dawn “E-commerce is growing incredibly fast right now, to give you an example of the fast growth rate in the industry we at Yayvo beat our 2015-16 revenue numbers in four months. At the moment we still have Ramazan and Eid campaigns going on but the figures are definitely going to be bigger than last year’s.”

“Fashion, ready-to-wear clothing is popular at Eid time to save the hassle of dealing with tailors in Ramazan. Groceries are also big sellers at this time,” said Mr Dawood.

With a 200 million population the growth of online is vast. At the moment, online retail is barely 0.2pc of the overall retail market. But this is only a time factor as the sector is relatively new in Pakistan and still growing. There are many hurdles that still need to be addressed.

For a start, trusting digital payments, online security issues as well as how the government will tax the online shopping basket. Eventually, a consortium might need to be created to bring everyone together to tackle these challenges.

With two growing companies aspiring to be Amazons in Pakistan, the long-term growth of online shopping is beneficial to consumers, retailers and vendors as well as creating new employment opportunities in logistics, vendors and fast delivery services.

The growth in online shopping will not completely replace offline shopping in Pakistan because people like the in-store experience as they need to touch, see and try on the product in ways that they can’t do online.

In the future, these online marketplaces will start to transform the online shopping journey where consumers will have the in-store retail experience with virtual shopping aisles.

Published in Dawn, June 25th, 2017