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Daraz Nepal

Pratistha Sthapit

Westcliff University

MGT 303: Online Business

Professor Subedi

May 13, 2024

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Daraz Nepal

Daraz is a well-known e-commerce business platform in Nepal that sells a wide range of

products from different companies to customers. It was first established in Pakistan in 2012

A.D., by the German company Rocket Internet (Jajja & Jat, 2019). From 2012 to 2014, the

online platform only sold fashion products such as clothing, footwear, accessories, etc. In 2015,

it expanded its product offerings and started selling a wider range of products such as electronics,

health and beauty products, foods, baby products, groceries, etc. All the products were from

different companies. After the change in its business model, the company began operating in

different countries like: Bangladesh, Shri Lanka, Myanmar, and Nepal. Daraz started as an

online business in Nepal in 2016 AD. So, with the introduction of Daraz, people could now

easily shop for products from their homes without having to visit individual stores. Additionally,

they could compare prices for the same products from different companies on the Daraz app,

enabling them to choose based on their preferences, whether it be the lowest price or higher

quality from a particular company. This allowed people to make informed decisions based on the

terms and conditions of different companies and purchase products according to their preferences

through Daraz.

Business to Consumer (B2C) E-Commerce Platform

Business to Consumer (B2C) is a type of e-commerce that sells its products directly to

the consumers. It does not include any middleman like retailers. So, here, the business directly

sells its products to the hands of the consumers reducing the additional cost of the middleman

(Chen et al., 2019). Daraz is also a B2C e-commerce platform as the company connects directly

with the customers. For example: if someone wants to buy a camera from Daraz, they can use the
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Daraz app to find and order it. Customers need to provide their phone number and location for

easy delivery, choose a payment method, and Daraz informs them about the delivery day. Daraz

then delivers the product directly to the customer, without involving any middlemen.

Infographics Link

https://www.canva.com/design/DAGFC1qhJ-U/lhi0HK3NHZ0EV8XpDjlQ9w/edit

Features of Daraz

Wide Range of Products both for Purchasing and Selling

Daraz Nepal has provided a wide range of products to both the customers and the sellers.

So, customers could purchase any product, whether it be clothing, footwear, electronics, health

and beauty products, groceries, or anything from the Daraz app. Another main feature of the

company is that it allows any company to sell its products. So, this means that the products

available on Daraz are all sourced from external companies. Any company can sell its products

in the Daraz App except for a few. For example: if my company sells any products like frozen

foods, bakery, fresh produce, ice cream, walkie-talkies, etc., I won't be able to sell it in the Daraz

app. Companies could research the prohibited items of Daraz and if their company does not

include such products, they can sell their product in the Daraz app by following the process

required. So, Daraz Company provides a wide range of products for customers to purchase and

sellers to sell.
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Use of Azure OpenAI Service Model to Offer Personalized Shopping Assistant to the Users

Daraz Company utilizes Azure OpenAI service model to provide personalized shopping

assistance to its customers. This AI-powered personal assistant looks at the things that the

customer has browsed and it also looks at their purchasing behavior so that it can suggest

relevant products tailored to individual preferences (Daraz, 2023). So, this feature of Daraz helps

to make the shopping experience of customers more personal and convenient.

Comprehensive Product Information and Reviews

The app of Daraz has provided detailed information about products along with product

images and customer reviews. For example: If I need to purchase a raincoat from Daraz then I

can search for it in the app and it will show me lists of different raincoats of different companies

along with the product picture, ratings (given by the customers who have purchased the product),

pieces sold, price, and reviews. Now, looking at all these things, I can make the decision of

which piece to purchase. So, the company has provided detailed product information and reviews

through which customers can decide to purchase.

E-commerce Training on Daraz University

Daraz University offers training opportunities to sellers which helps them to use the

platform effectively. This training also helps the sellers to enhance their sales strategy and helps

to enhance the overall performance of Daraz.

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Successfully Cater to Target Audiences

Rating and Review System

Rating and review of products plays an important role. It is very crucial for every

business to know about the ratings and reviews of the target customer regarding the product they

purchased (Laudon & Traver, 2022). Daraz utilizes this system by closely monitoring reviews

and making sure that they take necessary action to provide the best quality and service to the

customers.

Quick Customer Service

Daraz provides quick customer service. If any customer has any question regarding any

products then the company replies to the queries within 24 hours.

Refunding and Return Policy

If any of the customers are not satisfied with the product, do not need the product

anymore, or receive a defective piece, then the company has a refunding and return policy. The

refund and return should be done within 12 days of the purchase.

Mega Campaigns Providing Positive Customer Experience

Daraz hosts mega campaigns like Dashain Dhamaka and 11.11. In this campaign, the

company offers a huge amount of discounts. These campaigns prioritize providing a positive

customer experience by effectively handling large volumes of orders within a short time.
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Competitive Advantages

Wide Range of Products

Competitors of Daraz (like: SastoDeal, OkDam, Hamrobazar, etc.) may not have as

extensive a range of products as Daraz. Customers can purchase any product, whether it be

clothing, footwear, electronics, health and beauty products, groceries, or anything from the Daraz

app.

Use of Azure OpenAI Service Model

With the use of AI, the company provides suggestions of relevant products tailored to

individual preferences. This helps to make the shopping experience of customers more personal

and convenient.

Mega Campaigns

During mega campaigns like 11.11, Daraz offers huge amounts of profit which helps the

company to increase sales.

E-commerce Training at Daraz University

E-commerce training helps the sellers to effectively use the platform and enhance their

sales strategy. So, providing such training makes it easier for the seller to understand the system,

increasing the number of sellers.

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Unique Selling Point

Convenient Shopping Experience

Daraz enables customers to shop conveniently from their homes without having to visit

individual stores. Customers could also compare prices for the same products from different

companies on the Daraz app, enabling them to choose based on their preferences (Shakya, 2021).

This allowed people to make informed decisions based on the terms and conditions of different

companies and purchase products according to their preferences. It provides features such as AI

personalized shopping assistance and effective and quick customer service to make their

shopping experience more comprehensive.

Trusted Marketplace

Daraz is a trusted marketplace where customers can find high-quality products from

reputed companies. Every product is backed by ratings and reviews of the customers. It also

offers refund and return policies for any unsatisfied or damaged products.

Successful Business Strategies

Customer-Centric Approach

The company gives priority to the customer for the best selection of products, seamless

purchase experience, transparent pricing, convenient and fast delivery, and strong customer

service. This strategy aims to maintain and improve customer satisfaction.

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Prioritizing Expansion into New Cities

Daraz prioritizes the expansion of Daraz's services to new cities so that they can reach out

to all Nepalese. This strategy focuses on increasing market reach and accessibility to a wider

customer base (Ahmad et al., 2022). So, the company uses a market expansion strategy.

Enhancing Connectivity with Customers and Sellers

This strategy aims to strengthen relationships with stakeholders by fostering better

engagement and communication on the Daraz platform, leading the company to improve

relationships with all the stakeholders.

Emerging Technologies

Implement Virtual Reality (VR) and Augmented Reality (AR) Technologies

In this digital world, technologies have developed so much that people don't even need

books to read. They can easily use VR and AR to learn new things while experiencing them. VR

is a computer-generated environment whereas AR displays the physical world but overlays it

with digital information (Alkhamisi & Monowar, 2013). Businesses these days have started

using both of these technologies. For example: Gucci uses both AR and VR technology. Gucci

partnered with Snapchat to use AR shoe try-on lenses. So, the customers can select a pair of

shoes and point their camera on their feet and the virtual pair of shoes they selected will appear

on their feet (Li et al., 2021). Customers can now virtually see how the Gucci shoe will look on

them. The company uses VR technology for its marketing campaigns. For example: Gucci has

launched VR experiences that allow customers to eplore the brand history in a virtual
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environment. Similarly, Daraz can also use those technologies to provide a higher level of

experience to the customers.

Integrating Voice Commerce Capabilities

Daraz could integrate voice commerce capabilities where customers could interact with

the platform through their voice. If customers need to search for any products or place an order,

they will be able to use voice commands through virtual assistants like Alexa, Siri, or Google

Assistant instead of typing on the Daraz app or website. This would offer a more convenient

shopping experience to the users who prefer voice commands.

Changing Consumer Behavior

Investment in Advanced Data Analytics and Machine Learning

Daraz may invest more in advanced data analytics tools and machine learning in order to

gain a deeper understanding of customer preferences, behavior, and purchasing patterns at an

individual level.

Optimization of Mobile App and Website for Better Shopping Experience

As people these days prefer online shopping over visiting the store, Daraz could focus on

optimizing its mobile app and website to ensure a seamless and user-friendly mobile shopping

experience. Making the features more user-friendly, improving site performance, etc., could be

done to improve customer shopping experiences.

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Market Trends

Increasing Promotion of Eco-Friendly Products

As we know, these days’ sustainability conscious people have increased a lot. With the

increase in sustainable-conscious people, demand for sustainable products also increased. So,

Daraz might introduce initiatives to promote eco-friendly and socially responsible products on its

platform. To do this, the company could partner with sustainable brands, implement eco-friendly

packaging instead of plastic packaging, and launch campaigns focusing on raising awareness

about environmental degradation.

Expansion in Offerings of Niche Markets

Daraz offers products from a wide range of companies, but some product categories may

have high demand but low competition. Such markets are known as niche markets. So, Daraz

could identify such niche markets and expand its offerings in these areas. This could be done by

partnering with niche sellers and launching target marketing campaigns to attract customers who

are interested in such niche market products.

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Conclusion

Daraz is a well-known e-commerce business platform in Nepal that sells a wide range of

products from different companies to customers. Daraz started as an online business in Nepal in

2016 AD. Daraz is a B2C e-commerce platform as the company connects directly with the

customers without involving any middlemen. Daraz provides various features like a wide range

of products, the use of Azure Open AI Service Model to offer personalized shopping assistance,

comprehensive product information and review, and e-commerce training at Daraz University.

With all these features, it is easier for the user and the seller to effectively use the website. Daraz

follows a rating and review system, provides quick customer service, a refunding and return

policy, and mega campaigns in order to ensure the customer experience. It has competitive

advantages of a wide range of products, use of Azure OpenAI Service Model, mega campaigns,

and e-commerce training at Daraz University. It follows different business strategies like: a

customer-centric approach, prioritizing expansion into new cities, and enhancing connectivity

with customers and sellers. The company can implement AR and VR, voice commerce

capabilities, optimize mobile apps and websites, and increase the use of eco-friendly products to

evolve in response to emerging technologies, changing consumer behavior, and market trends.
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References

Ahmad, S. M. A., Iqbal, M. M., Ray, K., & Rahman, S. (2022). Identifying Strategies and

Procedures of Seller Engagement of Daraz. Daffodil International University Journal of

Business and Entrepreneurship, 15(1), 64-77.

https://www.researchgate.net/publication/362733175_Identifying_Strategies_and_Proced

ures_of_Seller_Engagement_of_Daraz

Alkhamisi, A. O., & Monowar, M. M. (2013). Rise of Augmented Reality: Current and Future

Application Areas. International Journal of Internet and Distributed Systems/International

Journal of Internet and Distributed System, 01(04), 25–34.

https://doi.org/10.4236/ijids.2013.14005

Chen, J., Guo, Z., & Tang, Y. (2019). Research on B2C E-Commerce Business Model Based on

System Dynamics. American Journal of Industrial and Business Management, 09(04),

854-874. 10.4236/ajibm.2019.94058

Daraz. (2023, July 28). Daraz to empower South Asian users’ shopping experience with

Microsoft Azure OpenAI Service — Daraz. https://daraz.com/newsroom/daraz-to-

empower-south-asian-users-shopping-experience-with-microsoft-azure-openai-service/

Jajja, M. S. S., & Jat, M. N. (2019). Daraz.PK: Online marketplace’s value chain. Asian Journal

of Management Cases, 16(1), 21–37. https://doi.org/10.1177/0972820119825976

Laudon, K. C., & Traver, C. G. (2022). E-Commerce 2021-2022: Business. Technology. Pearson

Education. file:///C:/Users/dell/Documents/Online%20Business/MGT%20303%20E-
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%20C.%20Laudon%20Carol%20Guercio%20Traver.pdf

Li, Q., Zhu, C., & Shi, T. (2021). Augmented Reality Advertising in an e-commerce Model with

Competition. Electronic Commerce Research and Applications, 49, 101092.

https://doi.org/10.1016/j.elerap.2021.101092

Shakya, V. (2021). Network Security and Its Impact on Business Strategy: A Case Study on E-

Commerce Site Daraz.Com. LBEF Research Journal of Science, Technology and

Management, 3(1), 45-60. https://www.lbef.org/journal/3-1/download/3-1-45-60.pdf