Saturday, November 28, 2015

Black Friday in Pakistan?

Pakistan saw its first Black Friday sales this year. These retail sales were on at both brick-and-mortar stores and e-tailers like Daraz.pk. There were also media reports indicating similar sales in the UK and other countries as well.  For those unfamiliar with Black Friday, let me explain what it is.

Black Friday, a day of mega sales by retailers, follows Thanksgiving Day in America. Black Friday marks the start of the annual Christmas shopping season that accounts for about half the annual retail revenue and much of the profits earned by US retailers.

Thanksgiving is a quintessential American holiday that commemorates the arrival of European "Pilgrims" fleeing religious persecution across the Atlantic. It is celebrated with a dinner of turkey, cranberries and corn that made up the feast offered by native Americans, also known as American Indians, to welcome the hungry and tired Europeans in this continent of North America. President Barack Obama used the occasion to remind today's Americans of their duty to welcome those who are fleeing persecution in Syria and elsewhere in the Middle East. Here's what the President said:

“Nearly four centuries after the Mayflower set sail, the world is still full of pilgrims – men and women who want nothing more than the chance for a safer, better future for themselves and their families. What makes America America is that we offer that chance. We turn Lady Liberty’s light to the world, and widen our circle of concern to say that all God’s children are worthy of our compassion and care. That’s part of what makes this the greatest country on Earth.”

So what do many American shoppers do on Black Friday? They mob the shopping malls and the brick-and-mortar stores as they open very early on Friday morning following Thanksgiving holiday to snap up bargains. Overzealous shoppers are known to knock down and trample other shoppers as they race to take advantage of bargain basement prices on items such as new apparel, consumer electronics and toys. With the rise of e-commerce, many American shoppers now prefer to take advantage of Black Friday sales offered by popular e-tailers like Amazon.com. The e-commerce sites usually have such Black Friday sales continue beyond a single day.

This year, Pakistan's Daraz.pk e-tailer offered Black Friday bargains to Pakistani shoppers. Daraz.pk partnered with several companies including PTCL, Ponds, Mediatek, InnJoo and Easypay. EasyPay is the official payment partner, offering an additional 25 per cent discount on products to customers who use Easypay on Black Friday.  There were category discounts as high as 63 per cent on smartphones, 50 per cent on computers and 70 per cent on fashion and accessories on offer at Daraz, according to Express Tribune newspaper.

In addition to e-commerce sites, there was also a report in England's "The Daily Mirror" about "Lahori aunties going mad" on Black Friday at a fabric store in Lahore.

To the dismay of many, American style consumerism is finding broad acceptance among the middle class consumers across the world, including developing countries like Pakistan. Is this wise? Is it sustainable? How would it affect our future? I'll leave these questions for the readers to answer for themselves.


https://vimeo.com/147199858



Amir Khan Under Fire Over "Intolerance" in India; Black Friday in Pakistan; Russia-Turkey Conflict in Syria; PPP's Asim Husain C from WBT Productions on Vimeo.


https://youtu.be/_y07qQCtWXw





Related Links:

Haq's Musings

E-Commerce in Pakistan

High-Tech Investments in Pakistan

Upwardly Mobile Pakistan's Appetite For International Brands

Pakistan Middle Class Grows to 55%

South Asia's Rising Consumption; Depleting Resources

Syrians Flee Persecution


10 comments:

Riaz Haq said...

The billionaire Samwer brothers want to help introduce Pakistan’s shoppers to a local version of Black Friday, the November sales binge that kicks off the year-end holiday retail season in the U.S.
It doesn’t matter that Black Friday is an American invention, said Bjarke Mikkelsen, co-chief executive officer of Daraz, the online retailer backed by the brothers’ incubator Rocket Internet SE. Daraz -- operating in Pakistan, Myanmar and Bangladesh -- will team with brands and advertisers to offer “hundreds of deals” on Nov. 27, he said. It will partner with Easypay, the mobile payment service offered in Pakistan by Norwegian wireless carrier Telenor ASA.
“It’s a shopping event that was created in the Western world,” Mikkelsen, a former Goldman Sachs Group Inc. investment banker, said in an interview. “It’s a way of attracting many people with great deals and big marketing.”
Daraz, a three-year-old company, is getting more funding to bankroll that effort. On Tuesday, Daraz said it raised 50 million euros ($56 million), including 20 million euros from CDC Group, a British government-owned investor trying to create jobs in Africa and South Asia. The rest came from Asia Pacific Internet Group, Rocket’s joint venture with Qatar mobile carrier Ooredoo QSC.
Daraz is taking a page from Amazon.com Inc. and Alibaba Group Holding Ltd., which have demonstrated how hefty one-time discounts and exclusive merchandise can get American and Chinese bargain-hunters to spend billions of dollars. Daraz also plans its own version of Cyber Monday, the online shopping event held three days after Thanksgiving, which occurs in the U.S. on the fourth Thursday of November.
$20 Smartphones
The plans are in the making even though Pakistan currently has only about 30 million Internet users. Neighboring India has 10 times as many, according to the lobby group Internet and Mobile Association of India, yet Pakistan’s $232 billion economy is on track for its fastest pace of annual expansion since 2008.
Daraz draws 6 million visitors a month spending a combined 1 million euros on exclusive offers for Chinese-made smartphones, TVs and clothes, Mikkelsen said. It sells via websites and mobile apps and almost half its deliveries venture beyond major cities, with smartphones as cheap as $20 being a top seller.
Building buzz will be key for a company that started out as a fashion retailer before expanding its wares in November 2014. It partnered with Google Inc. to host Tech Mela, a 10-day online shopping event that preceded this month’s Islamic Eid al-Adha holiday.
There’s little point advertising online when Internet penetration is so low, Mikkelsen said. Instead, Daraz is recruiting taxi drivers and college students to become “brand ambassadors,” or a sales force paid on commission.
“By tapping into a global shopping phenomenon we will create a more powerful event than if we made up a new concept from scratch,” he said.

http://www.bloomberg.com/news/articles/2015-09-22/billionaires-startup-brings-black-friday-to-pakistan-s-shoppers

faiz said...

Is the human development index for 2016 out yet? Have you looked at the data?

Riaz Haq said...

faiz: "Is the human development index for 2016 out yet? Have you looked at the data? "


No, I haven't. It's irrelevant for the subject of this post because the merchants know who their main target is: Pakistan's urban middle class consumers who have rising incomes and fairly high levels of human development.

Read the following to learn about it:

http://www.riazhaq.com/2013/04/upwardly-mobile-pakistans-growing.html

Ashraful said...

Per Multinational Professional Service auditor PwC, in nominal GDP Bangladesh economy will surpass Pakistan in 25 years or 2040. In per capita terms Bangladesh will surpass Pakistan in 15 years. The poor dark Bengali Pakistanis of 1947-1971 will be ahead of their richer lighter western Pakistanis or just Pakistanis today.

Riaz Haq said...

Asharful: "Per Multinational Professional Service auditor PwC, in nominal GDP Bangladesh economy will surpass Pakistan in 25 years or 2040. In per capita terms Bangladesh will surpass Pakistan in 15 years."

Extrapolating current trends to forecast the future may work for short periods but it has never worked over such long periods.

It's hard to believe Bangladesh can do in15-20 years what it has failed to achieve in the last 40 years since independence.

We all know Pakistan's natural advantages: Larger population, younger demographics, more human capital, bigger natural resources and significantly greater landmass.

Majumdar said...

Faiz sb,

Is the human development index for 2016 out yet? Have you looked at the data?

The HDI report will be out on December 14. In all probability it will show India continuing to be 2-3 positions ahead of Pakiland. That being the case, it is unlikely that Prof Riazul Haq sb will at all be interested in this piece of data.

Meanwhile, the access to Internet report is out and India at #131 beats Pakiland #142 by 11 ranks.

Regards

Riaz Haq said...

Majumdar: "The HDI report will be out on December 14. In all probability it will show India continuing to be 2-3 positions ahead of Pakiland. That being the case, it is unlikely that Prof Riazul Haq sb will at all be interested in this piece of data."


Just do a search for HDI on my blog to see for yourself how wrong you are:

http://www.riazhaq.com/search?q=HDI

Majumdar: " Meanwhile, the access to Internet report is out and India at #131 beats Pakiland #142 by 11 ranks."


Internet penetration is rising rapidly now, much faster than India, since the launch of 3G and 4G late last year. There was 33% increase in subscriptions in the last quarter alone.

http://www.riazhaq.com/search?q=3G+4G


Riaz Haq said...

Post-#BlackFriday: In #Pakistan, #ecommerce entering a new era with big-ticket items sales to rural customers http://tribune.com.pk/story/1009343/post-black-friday-in-pakistan-e-commerce-entering-a-new-era/ …

Not long ago, e-commerce in Pakistan was primarily related to online sales of smartphones, laptops and fashion apparel and almost all online retail sales were generated from Karachi, Lahore and Islamabad – the largest urban centres constituting major markets for e-commerce even today.

Fast forward to 2015, Pakistan’s e-commerce sector held the country’s first ever ‘Black Friday’ in the last week of November. The industry noticed people buying washing machines and televisions online with orders coming from as far as Tando Allahyar. The rural town, as opposed to a daily average of one, placed 50 orders on Homeshopping.pk, a major player, which had 40,000 people on its website when the deal started at midnight (the night between Thursday and Friday).

According to major market players, one-third of the total Black Friday transactions were online – a major shift in the consumer habit from cash-on-delivery (CoD), which still accounts for more than 95% of Pakistan’s e-commerce that has already surpassed the $100 million milestone. These Black Friday trends indicate e-commerce in Pakistan is certainly picking up.

According to industry experts, e-commerce follows a four-phase growth cycle from infancy to maturity in any new region. Some say China has entered the third phase while India is close to finishing the second.

However, when it comes to Pakistan, many say the country’s e-commerce is still in its infancy. But a successful Black Friday, which received an overwhelming response from consumers across Pakistan, certainly merits a question: is the country’s e-commerce entering level two?

“Absolutely, Pakistan’s ecommerce is entering the second phase,” says Saman Javed, Head of Communications and PR at Daraz, which started Black Friday sales and invested heavily in its marketing for consumer awareness.

“One-third of the payments were online, which indicates a shift in consumers’ attitude who now trust online payment system,” Javed said, adding the response was beyond the company’s expectations, which shows the demand people have here is almost similar to elsewhere in the world.

Though it didn’t disclose sales figures, Daraz said it offered Rs132 million in discounts during Black Friday sales when 1.5 million people visited its website.

Another factor indicating an overwhelming consumer response was the websites of Daraz.pk and Homeshopping.pk – which attracted almost all the traffic on November 27 – went down immediately after the sale began.

“We witnessed something we have never seen before,” Shayaan Tahir of Homeshopping said, adding there were 1,000 people on their page at a single point in time. “It will be even bigger next year.”

Homeshopping sold Rs5.6 million worth of iPhones at more than one phone per minute during the first hour of its ‘White Friday’ sale before running out of stock. The company sold 45 units iPhone 6 Plus and 25 units of iPhone 6. This is in addition to 100 units of smartwatch sold by the online retailer.

By contrast, iPhone deal on Daraz was sold out within minutes and many consumers complained over being left out. The traffic was insane and not everyone could get what they wanted, says Javed. It’s a global trend where people fight for the best deals that sell out in minutes, she added.

While smartphones remained the top-selling category on all major platforms, other sectors were also impressive. Daraz says it had record-breaking sales for fashion while home appliances brands, such as Kenwood and Dawlance were also amongst the top sellers. On the other hand, TVs were among top selling categories at Homeshopping.

Riaz Haq said...

Samwers Peddle iPhones in #Pakistan for Emerging Market Lead. #BlackFriday #ecommerce http://bloom.bg/1QpyUhP via @technology

When Rocket’s shopping site Daraz held a Black Friday sale in Pakistan, orders jumped 55-fold compared to regular days, with rebated Apple Inc. Iphone 6s handsets selling out in five minutes. The same day, Rocket’s African shopping site Jumia had 35,000 orders mainly from Nigerian customers, with one in four of them new to the platform.
Rocket, which has already built up online retailers in countries including Indonesia, Nigeria and Pakistan, plans to expand further in Africa and Southeast Asia in a bet that young and growing populations, rising Internet and smartphone use and a widening middle class will fuel revenue growth and eventually profit. The Berlin-based company -- founded by Oliver, Marc and Alexander Samwer -- needs these regions to grow because unlike Amazon.com Inc. in the U.S. and Alibaba Group Holding Ltd. in China, Rocket doesn’t dominate one large home market.

Faisal waqas said...

Friday Bazaar is better than Black Friday in Pakistan

http://www.ishopping.pk/friday-bazaar.html