Kalithia Investment and Research Pvt Ltd, a market research consulting firm, conducted a brand perception survey focused on online retailers in Nepal to gain insights into Nepal’s emerging online shopping culture.
The introduction of new technologies and increasing internet penetration has facilitated the growth of the online shopping sector over the years. Decades ago, there were only a handful of online shopping sites, which were targeted towards Nepali buyers living abroad. However, with the growth in every industry (especially IT) and the gradual socioeconomic transformation, online portals and sites have mushroomed.
Despite the immense growth, online shopping sites seem to be struggling to win the trust of local stakeholders. One of the major reasons behind this is the unpleasant experiences of customers; oversight in delivering products, channel conflicts and complicated exchange policies. To understand the customers’ perception of online shopping in Nepal, we conducted a research.
The research was exploratory where a set of questionnaires were developed and posted on various social media platforms. Within two days, over 70 responses were received. It is presumed that the respondents frequently used online shopping sites. Out of the many online shopping sites, only a few can be positioned as being competitive in the market. Since its inception, Daraz has revolutionised the online shopping sector in Nepal. A wide product range, cost and time efficient shopping and a user-friendly interface are some reasons customers prefer Daraz.
However, respondents seem to look upon Sasto Deal as an alternate option. Established in 2011, the e-commerce portal has grown exponentially over the years. It has recently availed a significantamount of investment from Dolma Impact Fund to strengthen its market. With Nepal’s young and educated population having access to the internet, coupled with hectic lifestyles, traffic congestions and a growing middle-income population, online shopping has been a huge relief for many, especially for the population between 18 to 35 years.
Communication was found to be the key element to get ahead in the game. Most of the respondents felt that if they were informed well in advance about any delays in the delivery, they were less likely to be dissatisfied. It has been found the merchant switching tendency of buyers is high due to their expectations not being met. It was identified that there is a loyalty concern; if the customers feel they are not satisfied with the service, they do not mind shifting to an alternate option.
The cash culture is still prevalent, as ‘Cash on Delivery’ has proven to be the most preferred payment method in the digital shopping sphere. Despite several attempts from e-commerce sites for secured and frictionless payment via cards, most respondents are not comfortable using their cards online. They do not opt for pre-payment options due to the lack of confidence in the service delivery and the innate need to examine the product in person before making the payment. However, cash back offers may act as effective motivators to use digital wallets for smooth transactions, which has been observed as one of many factors for the advancement of E-sewa Pasal.
Even though there are many challenges that need to be addressed, companies need to be customer-centric. All online shopping sites are in the same playing field as they are trying to transform traditional purchase culture, which is a herculean task. The problems of one site are not only limited to the respective merchant but have implications for the whole industry.
* Results obtained from a small sample size and with time constraints may not represent the perception of the whole population.