NORTH SOUTH UNIVERSITY

MIS 480
E-Commerce and Web Management
Sec: 1

“Final Project on Daraz.com.bd“

Submitted To:
Dr. Samim Al Azad (SAA2)
Assistant Professor
Department of Management
School of Business and Economics

Submitted By:
1. Mahmudul Hasan Tonmoy ID: 1310576630
2. Neaz Mahmud ID: 1410104030
3. Lyric Hassan ID: 1330647630
4. Md. Mahmudul Hasan ID: 1410842030

Submission Date: 21st November, 2017

Letter of Transmittal

17th December, 2017

Dr. Samim Al Azad

Assistant Professor

Department of Management

School of Business and Economics (SBE),

North South University

Subject: Submission of Final Project on “Daraz.com.bd”

Dear Sir,

With due respect, I am a student of your MIS 480 (Sec: 1) course of fall ’17. According to your
provided guidelines, we have done our final project on Daraz.com.bd. The project is the
summary of all the knowledge and information we have gathered through our course as those
are the process we have used to analyze and prepare this final project.

We would like to thank you for the continuous guidance and feedbacks throughout the entirety
of the project. We express our sincere gratitude towards you and would be obliged if you would
kindly accept our final project.

Sincerely,

Mahmudul Hasan Tonmoy

ID: 1310576630

Course: MIS 480

Sec: 1

On behalf of my group members.

Executive Summary
Daraz Bangladesh Ltd. Is the first ever internet based mall style e-commerce site that follows
the similar e-business model pioneered by amazon.com where consumers can shop online and
find their desired product from a wide range of categories. Founded by the Rocket Internet
Group, Daraz Bangladesh started its operation back in 2013. Within a short span of time, it has
experienced a staggering growth of 350 to 400%. Daraz Bangladesh Ltd. is not only the first
ever e-commerce venture of our country but also the only multinational e-commerce website
that pioneered the idea of online shopping. Daraz is owned by Rocket Internet Group, a German
based startup incubator that invest heavily in countries outside the US and China and portrays
similarities of the popular e-business models. Apart from our country, Daraz.com is available
in Sri Lanka, Pakistan and Myanmar. Among these countries, the Pakistani version of Daraz
(Daraz.com.pk) is the most successful one. Besides Daraz.com, Rocket Internet Limited has 8
more ventures in Bangladesh such as – Kaymu, Lamudi, Carmudi, Foodpanda etc.
Table of Contents

Introduction 1

E-Business of Daraz 1

Context 1

Mission 1

Vision 1

Range of Services & Key Activities 2

No Fake Products 2

Safe and Secure Payment 2

Free and Easy Return Policy 2

E-Business Model 3

CANVAS 3

Drivers of E-Business Adoption at Daraz 3

Perceived Benefits 3

Perceived Cost 4

External Pressure 4

Management of Daraz 4

E-Business Revenue Model 5

Value Proposition 5

Revenue Model 5

Revenue Generating Strategy 5

Product Category 6

Market Segment 6

Demographic 6

Psychographic 6

Geographic 6

Market Structure 6

E-Business Platform/Infrastructure 7

E-Business Application Service 7

Enterprise Resource Planning (ERP) 7

Customer Relationship Management 8

Customer Touch Point 8

Data Stores & Data Mining 8

CRM Analysis 8

Supply Chain Management 8

Pick-up 8

Drop-off 8

Consignment 9

IT Use for E-Business Application 9

Internet 9

Extranet 9

Intranet 9

The Web Technology & Software 9

Facilitate Collaboration 10

Available at Anytime 10

Link to Variety of Media 10

Web Content Management Strategy 10

Digital Strategy for E-Business 10

E-Business Strategy 10

Digital Marketing 10

Mobile App 11

Friday Sell 11

Social Media 11

Website Design 11

Valuable 11

Enduring 11

Market Segment 11

E-Channel Structure 11

Analysis of E-Business Strategy 12

SWOT 12

Competitive Threat 13

E-Business Security 13
Five IT Security Risk 13

Corporate Data on Personal Device 13

Third Party Entry 13

Insider Employees 13

Smartphone Vulnerability 13

Retail Data Hacks 13

Conclusion 14

References 14

Appendix 15
 Introduction
Daraz offers the customers a true online shopping experience that is unmatched to anyone and
act as medium for both the seller and the customer. Daraz let the sellers to sell their products
on its website in exchange of a percentage margin thus portraying as a B2C online marketplace.
Since its beginning in 2013, Daraz has set a standard for e-commerce business model and
pioneered the idea of online shopping that encouraged a bunch of other local entrepreneurs to
seek opportunity in this field. Since its inception, Daraz also started strategic partnership with
other consumer products manufacturer specially with the first moving consumer goods –
FMCG manufacturers such as – Uniliver, Rackitt Benckiser, GlaxoSmithKline, ACI, Square
etc.

E-Business of Daraz.com.bd

Context
E-Commerce is the trading of products and services using internet technologies that brought
about revolutionary changes in traditional brick and mortar business culture. Daraz is heavily
depended and invested on online technologies (e. g. – the mobile internet) and unique feature
such as – home delivery, cash on delivery, easy return policy, flexible and secure online
payment systems etc.

Mission
Daraz’s mission is to provide an enjoyable shopping experience for its customers and to grow
together with its sellers. It will continue building a vast loyal customer base by having the
broadest selection of products, unbeatable prices, 100% reliable fulfillment process and
relentless focus on customer experience.

Vision
Daraz has a vision to be the most reliable marketplace and offer the best services to their
customers: Consumers and sellers.

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Range of Service & Key Business Focus
Daraz sells a wide assortment of products on its website and these products has been
categorized systematically in a way that a customer can easily find his/her product. These
categories are –

1. Men’s fashion
2. Women’s fashion
3. Phones & Gadgets
4. TVs, Audio & Cameras
5. Computer & Gaming
6. Appliances
7. Home & living
8. Sports & Travel
9. Beauty & Health
10. Baby, Kids & Toys
11. Grocery
12. Miscellaneous

Daraz is leading as the front-runner in e-commerce sector in Bangladesh and they strickly
follow some rules to be at the top all the time. Such as –

No Fake Products:
Daraz offers its customers with the largest selection of authentic and brand new products at
the highest quality. Fake and duplicate products do not have entrants at its web store.
According to them, it has become their mission to offer only 100% genuine products in the
original packaging to the consumer.

Safe & Secure Payments:

Whether the customer wants to pay cash on delivery or conveniently with one of Daraz’s pre-
payment methods e. g. – credit/debit card/Easypay or JazzCash – customers’ privacy is the
most important factor to them and they keep the cusomers’ data confidential.

Free & Easy Return Policy:

Returns and replacements are easy and free of charge. Although there are few or no
dependable data to back this statement.

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 E-Business Model
Daraz’s e-business model is depicted below on a business model canvas –

Figure: Daraz.com.bd e-business model CANVAS.

Drivers of E-Business adoption at Daraz.com.bd

There are several factors that are working as the driving force to adopt the e-business among
organization. These can be described as:

Perceived Benefit:

The internet usage is rising more and more in the market forcing organization to adopt
internet technology to tap that market where users are looking for products or services that
are easily accessible and convenient to consume.Daraz.com takes this benefit into
consideration and now they are trying to expand their business.

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Perceived Cost:

The cost for starting an e-business basically depends on the different software and its
installation cost. Since Daraz is an online-only venture, its main investments are focused on
implementing e-business solution into its business.

External Pressure:

External pressure involves factors such as political condition, government rule and
regulations. While starting the business, Daraz had it on their mind.

Management of Daraz.com.bd

Daraz has its first ever Bangladeshi country manager, Mr. Mustahidal Haque – serving as the
managing director of Daraz Bangladesh Ltd. Their organizational hierarchy is depicted below

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 E-Business Revenue Model
As e-commerce is becoming very popular in Bangladesh, many international and national
platforms are emerging in the online marketplace. Daraz is one of the most popular sites in
many countries including Bangladesh, Myanmar and Pakistan. Below we can see the Business
Model CANVAS of Daraz.com.bd:

Value Proposition:

 Daraz is the biggest online shopping platform in Bangladesh.

 They ensure the fastest delivery system
 Easy and safe shopping environment
 They have a very competitive pricing strategy
 They provide 7-days return policy for their products.
 Variety of products and services are available.
 They use most advanced technology for maintaining their business.

Revenue Model:

 Their revenue model is a mixture of Sales and Advertising

 They accept cash on delivery, bKash, credit cards as their payment method.
 Their biggest revenue stream comes from sales. They do not produce products but get
sellers commission from the partner companies.
 They have both B2C and B2B customers.
 They use Google AdSense, OpenX and Yahoo for advertising.

Revenue Generating Strategy:

Daraz’s main strategy and also their USP that sets them apart from their direct competitors is
that where they sell and buy from. They buy products in a bulk so their each items cost is
lower than typical retailers and they also source their products from third party vendors. They

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do not always keep the products in their own inventory rather use suppliers inventory and
collect products form them when needed.

 Product Categories:
o Electronics
o Gadgets
o Cell Phones
o Televisions
o Fashion Accessories
o Clothing
o Household items
o FMCG Products

 Market Segmentations:
o Demographic Segments: They have products for men, women and children.
Their products are differentiated by price and brands to attract as much
customers as they can.

o Psychographic Segments: Products are based on the lifestyles of the

customers. Like: Computer and Gaming, Sports and Fitness, Home and Living
etc.

o Geographic Segments: They deliver products to most part of Bangladesh.

Most orders are delivered within 3-5days in Dhaka and 5-8 days for outside of
Dhaka.

o Market Structure: Daraz is a joint venture of Rocket Internet and GMBH

which is situated in Germany. They are the largest venture incubator outside
USA and China.

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 E-business Platform/Infrastructure
Today in digital Bangladesh, Daraza.com now has one of largest E-commerce platform which
connects a large portion of buyers and seller in a single platform. Daraz is a mall-style online
business which doesn’t sell its own product rather they work as an intermediary between
buyer and seller. In a mall, customers can visit different shops and buy different things from
different shops. Daraz has virtualized this Mall-style business where customers can visit to
their preferred shops. So now customers don’t need to walkthrough different shops to find
their desire product, they can now buy their desire products sitting at home by visiting
daraz.com.

E-business Application services

Draz.com is providing a large online business platform for its suppliers and consumers so
obviously its use several application and soft-wares to manage its inventory, contact with
suppliers and to keep relationship with its customer. But as daraz.com is a fully web-based
business, the soft-wares it uses for its business is a crucial part of its business. So they were
unwilling to disclose most of the name of the soft-wares they use for their online business. But
they have disclosed the name of the few soft-wares to us and described how their software
helped them to continue their daily operation.

Enterprise resource planning (ERP):

Daraz.com basically use oracle E-business software application in most of its operation
such as for its finance and portfolio management activities .To integrates all of the software
including CRM and SCM, Daraz.com use oracle Enterprise Resource Planning Cloud as an
enterprise resource planning software.

In a following way ERP helps Daraz.com:

 It makes daily operation more flexible and less time consuming.

 It’s make inventory management more efficient
 It helps to make effective relationship with suppliers and consumer
 It helps to create a more relevant financial data and ensure better portfolio
management.

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Customer Relationship Management
In an online business there is little direct interaction between customers and the business
organization. That’s why online business like Dara.com needs different types of software to
keep track of their customer activity and maintain relationship with them. Daraz.com is always
concern about their customer satisfaction. So CRM activity of daraz .com is explained below:

1. Customer touch point: customers can easily communicate with daraz.com by visiting
their websites. In their website there is contact information given including their phone
number, Email address and their face book page. Customers can also send their message
via messenger and they are very responsive.
2. Data stores and data mining: to keep information of customers they use Microsoft
access which is very popular software to record and retrieve data. Microsoft access
helps them to record data about a customer order. They can also retrieve data about
customer order any time through Microsoft access.
3. CRM analysis: To track and analyze customer activity daraz.com use Google
analytics. Goggle analytics is software developed by Google it track and provide reports
about particular websites traffic. By Google analytics, Daraz can know how often a
customer visits their website and how long they stayed on the websites. They can also
know which web page or shop is performing poor through Google analytics and based
on that they can focus on the shop which is performing well and formulate their
strategy. Google analytics is a free of charge; it also takes charge for additional features.

Supply Chain Management

Daraz.com has several suppliers for its mall business. Most often they directly approach
to supplier to make contract or deal. Daraz.com basically has three ways to deal with
suppliers:

 Pick-up: In this way Daraz.com make a contract with its supplier for a certain
volumes of product to be displayed on their websites. When the customers ordered
those products, Daraz will informed the supplier and the supplier will deliver their
own product. For this service daraz will charge some commissions.
 Drop-off: Drop-off is almost similar like Pick-up. But in here the product of
supplier’s temporality stayed on the Daraz ware house and its daraz who deliver its
supplier product. For this Daraz charge certain delivery fee.

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  Consignment: Consignment is where Daraz buys a bulk of product from its supplier
and then resale it to the end user. Most of the products that they buy in bulk are
cosmetics products like soap, shampoo, and lipstick and skin lotion. They also buy
toilet cleaner and dishwasher in a large volume.

IT use for E-business application

 Internet: Daraz is an online business organization so there is no doubt that internet
connection is most important thing for its business. Like many other company it has
its own server to run its website. Daraz is fully internet based business. Most often
it interacts with its customer and supplier through internet. Daraz has its own
Facebook page, twitter to broad its internet world. According to BTRC there is 80
million internet users in Bangladesh so internet is a great source to grab a large
number of consumer and Rocket internet has seized the opportunity by establishing
daraz.com which provide opportunity to the general public to receive mall style
services through internet.
 Extranet: Daraz warehouses and offices are located in different places across the
country. To connect with other offices and its headquarter Daraz use extranet
connection. Extranet also help to connect with its supplier and consumer. The
extranet is used by LAN along with fiber optic cable. Through extranet daraz can
transfer its information about inventory, financial data and market data to its other
offices and its suppliers.
 Intranet: To foster communication among the employees Daraz also use intranet
within the organization. Intranet software like Microsoft SharePoint helps the
employees of the organization to work efficiently while continuously
communicating with each other. Some of the employee also use share it or blue
tooth connection to transfer small files,

The web technology and software applications:

Daraz.com is a modern and innovative web business which is not just a information
portal used by web.1 technology but a modern websites where sellers and buyer could interact,
buyer could purchase by choosing any payment method and any one could open an account in
daraz.com. So obviously daraz.com has used web 2.0 technologies which allow its website to
be more flexible and user friendly among the consumers.

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The advantages for daraz.com using web 2 technologies:

a) Facilitate collaboration: Web 2.0 technology not only allows the users of daraz.com
to obtain information from the webpage but also able to send message and purchase
items from the website. It has given more flexibility to end users.
b) Available at any time at any place: because of web.2 technology daraz.com is
available at any time at any place. A customer can access to the web page of daraz.com
at anytime from anywhere and purchase the desire item.
c) Link to variety of media: Through web 2.0 technology daraz.com was able to create
a link to its website to other social network like Facebook, twitter and Instagram. People
can find its contact information and link of Facebook page by entering into the website.

Web content management strategy:

Daraz.com is now most popular online mall-shop in Bangladesh. A great number of
people purchase their desire product from daraz.com daily and A great number of supplier
deliver their products to daraz.com on daily bases. That’s why they have to update their web
content daily. To manage the web content daily, there is a special team who update the
content daily on the bases of customer and supplier preference and this team is called D-
force. When a contract is made with a supplier or a product is delivered to Daraz warehouse,
the D force team immediately updates the information to Dares websites. The team is also
concerned about the speed and responsiveness of the website.

Digital Strategy for E-Business

E-Business Strategy:

Strategies are the techniques to run or accomplish some properly. In the context of
business, each and every business needs proper strategies to accomplish their specific goad in
a right way. Like that Daraz is a online business. There is a huge difference between the
strategies of an online business and a physical business. This online business is called E-
Business and in the sector of E-Business Daraz have some different strategies. These are:

Digital Marketing: As an online business the first and foremost strategy to marking
the products Daraz adopts digital marketing where they use different online platforms

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 like google ads, Facebook, YouTube and other popular platforms. They regularly
update the information about their product and other deals on these platforms to let
their customer updated.
Mobile Apps: They have a specific mobile app. This app is useful for both the sellers
and the buyers. By installing this app customer can get all the updated information on
their hand at any time at any place and sellers can know about the demand of their
products which are sold through daraz and manage their inventory based on the
demand.
Friday Sell: Daraz organizes a different campaign on some specific Fridays where
they offer some specific items of products with a huge discount to the customer. Their
main purpose of this campaign is to attract the customer and make them loyal to their
services by providing them good quality products with a low price.
Social Media: Most of the people in Bangladesh are familiar with the social media.
Daraz use these social media like Facebook, YouTube etc. to target the customer and
make their strategies by knowing the trends of their customer.
Website Design: The website of Daraz is fully responsive. They have designed their
website in such a way so that the users can easily get all the things they are searching
in the easiest way. In their website they have put both the options for Bengali and
English languages. They have made the categories in their website user friendly and
attractive to their customer.
Valuable: Building brand value, trust, and loyalty among the consumer and seller
makes Daraz more valuable than other e-business in Bangladesh.
Enduring: Most of the time Daraz focuses on long term goal. They ensure that each
and every customer of Daraz will be their loyal customer. They ensure this long term
goal by providing quality goods, goods with longevity, and service after sells.
Market Segment: Market segment is the most important matter which should be
considered at the time of any kind of product marketing decisions. If a firm can
segment their products properly that firm can easily reach to their goals. Daraz can
successfully segment their selling products according to brand, age, income, usage,
location etc.

E-Channel Structure: Daraz is running their business on the basis of e-mall strategy
where there are different kinds of virtual store fronts. Different kinds of sellers or product
suppliers use those store fronts to sell their product through Daraz. Daraz gets
commission by becoming the medium between the seller and the supplier of different

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 brand. Daraz conducts their business through their websites, Facebook page, telephone
etc. They have physical offices in different locations to conduct other operation related to
their business and 19 warehouses to maintain their inventory.

Daraz adopts multi-channel process for the payment method and receiving order.
They take order through Facebook, websites. After receiving the delivery they confirm
the deliver over the telephone. Customer can pay the product cost through credit card,
debit card, bkash, and delivery on cash. Daraz has a contact with a courier service called
Pathao to deliver their products to the customer.

Analysis of E-Business Strategy:

SWOT Analysis

Strengths Weakness
• Energetic Workforce • Backend delivery time.
• Number one multinational • Don't have personal
online platform delivery channel
• Superior Performance • Unawareness of rural
• Strong customer and consumers
supplier base.

Opportunities Threats
• 350-400% growth rate • Chances of reputation crisis
within 2-3 years. for simple fault.
• First internation online • Lots of online business are
market imarging with strong
• E-busiess as an emerging competition.
sector in Bangladesh. •kikhsa, bagdoom,
priyoshop, clickbd.

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Competitive Threat:

As Daraz is the first international online market platform, it has a small range of threats.
Till now Daraz doesn’t get any strong customer base from the rural area. They are try to
reach to them they have formed some specialized team to educate the rural people on how
to use their app, website and order products. The teams also educate the suppliers on how
to sell their products by using Daraz’s online platform. They are thinking their present
delivery time as their threat because they think other online market platforms are
delivering their products less than 3 days. Now Daraz is trying to lessen their delivery
time to 1-2 days.

E-Business Security:
Five IT Security Risk:

Corporate Data on Personal Devices: Whether an association disperses

corporate telephones or not, classified information is as yet being gotten to on
individual gadgets. Versatile administration instruments exist to constrain
usefulness yet securing the provisos has not influenced it to the need to list for
some associations.
Third-party Entry: Cybercriminals prefer the path of least resistance. Target is
the poster child of a major network attack through third-party entry points.
Insider Employees: Daraz has its own IT team. This IT team can be a threat for
their data base and overall IT system. They can involve in any kind of fraudulent
for the benefit.
Smartphone Vulnerability Threat: These days, representatives utilize a cell
phone to impart business data and direct employment-related exercises. Daraz
workers are the same as them. They have their own worker portable application
from which they can lead their business-related exercises.
Retail Data Hacks: Now a days’ online hacking is increasing. Cybercriminals
bring out customers from the websites by phishing technique and sell that
information in the black market. Daraz has surveillance team who always look
after their website so that no cybercriminals can attack their website.

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 Conclusion

It was a great experience for us to be able to visit an office dedicated to e-commerce

operations. We were greeted with people who are graduated from the same business school
that we belong, and the manager with whom we have spoken to – also graduated from NSU
School of Business & economics. The D-Force team employed by Daraz to educate their
stakeholders (e. g. – customers, suppliers etc.) regarding how to use the internet to shop
online - is truly remarkable. In a third world country like ours – where 67.245 million*
people use the internet or has accessibility to the internet, campaign like D-Force is
revolutionary and appropriate steps that aligns the idea of familiarizing the mass people with
the true potential of the internet and technology.

References
How Daraz BD has revolutionized purchasing habits. (2017, September 25). Retrieved
December 10, 2017, from https://www.daraz.com.bd/blog/2017/09/13/daraz-bd-
revolutionizes-online-shopping-habits/
An inner look at e-commerce giant: Daraz. (2015, November 23). Retrieved December 10,
2017, from http://www.thedailystar.net/lifestyle/check-it-out/inner-look-e-commerce-giant-
daraz-176806
Pakistan's first FMCG e-commerce solution with daraz.pk. (n.d.). Retrieved December 10,
2017, from https://www.unilever.pk/news/press-releases/2014/unilever-launches-
pakistans-first-fmcg-ecommerce-solution-with-daraz-pk.html

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Appendix

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