What exactly is e-commerce in Bangladesh?
E-commerce is the purchase and sale of goods and services by businesses and customers via an electronic medium. E-commerce is broadly grouped into four categories: business-to-business or B2B (Cisco), business-to-consumer or B2C (Amazon), consumer-to-consumer or C2C (eBay), and business-to-Employees or B2E (Bdjobs).
Overview of of E-commerce Industry in Bangladesh
Since the early 2000s, when Bangladesh lacked extensive internet access and a stable online transaction system, the e-Commerce sector has grown dramatically. The Bangladesh Bank, the country’s national bank, began allowing internet transactions in 2009. The Bangladesh Bank also legalized the buying and sale of goods and services online using international credit cards in 2013.
According to the International Telecommunication Union (ITU), internet users have nearly tripled from 6.5 percent of the population in 2013 to 18.2 percent in 2017, and this trend is continuing.
According to the eCommerce Association of Bangladesh (e-Cab), the country’s trade group, there are 700 eCommerce sites and 8,000 eCommerce pages on Facebook. Facebook continues to be a popular platform for promoting and selling things, to the point where many businesses have abandoned their websites. According to a 2017 e-Cab research, eCommerce sites handle ten billion taka in transactions each year.
Trends in the Market in BD
The four main types of e-commerce prevalent in Bangladesh today are :
1. Business-to-Business (B2B)
2. Business-to-Consumer (B2C)
3. Consumer-to-Consumer (C2C)
4. Business-to-Employees (B2E)
1. Business-to-Business (B2B) :
Several Bangladeshi B2B websites specialize in manufacturing and supply-chain solutions. For example, the Bangladesh Garment Manufacturers Employee Association (BGMEA) and other significant ready-made garment companies have implemented B2B e-commerce systems for international RMG orders and procurement. There are additional B2B websites like BDBusinessFinder and Address Bazar that include business directories, trade deals, and information about suppliers.
2. Business-to-Consumer (B2C) :
B2C websites have grown in popularity in large urban areas, as indicated by the expansion of online Food delivery companies such as HungryNaki, FoodPanda and efood. Congested highways and adverse driving conditions have also fueled demand for home delivery services. Other examples of B2C initiatives include Facebook-based commerce platforms enable Bangladeshi customers to purchase products from leading online shopping sites in the United States, United Kingdom, India, and China, such as Amazon.com, eBay.co.uk, Amazon.in, and Alibaba.
3. Consumer-to-Consumer (C2C) :
C2C businesses are expanding. Bikroy, Ekhanei, and ClickBd are the leaders in this category. Similar to eBay, these services are auction-based internet markets. It is also increasing in the private sector. bdjobs.com, prothom-alojobs.com, and jobsA1.com are popular online employment boards.
4. Business-to-Employees (B2E) :
Business-to-employee (B2E) marketing refers to techniques implemented by a corporation that are geared toward employees rather than customers. B2E (Business to Employee) is an abbreviation for Business to Employee. In Bangladesh, there are a large number of companies that host job search websites. Bdjobs.com, for example, is a job-search website in the country of Bangladesh.
The Enactment of the ICT Act for E-commerce :
The goal of the ICT Act, 2006 is to make it easier for e-commerce to develop and to promote the expansion of information technology. The ICT Act (amended in 2013) stipulated that those found guilty of computer-related offenses could be sentenced to prison and/or fined. E-commerce and mobile commerce in Bangladesh will be significantly impacted by the passage of the ICT Act.
Bangladesh Central Bank’s Contribution :
Credit and debit cards are rarely used (cash is still the preferred payment option) and big online transaction sites like PayPal are unavailable or restricted. In March 2017, Bangladesh’s central bank authorized Sonali Bank to offer PayPal-based (Xoom) online money transfers.
E-commerce Services in Bangladesh :
Many Bangladeshi businesses provide eCommerce services such as web design, domain name purchase, secure hosting, digital marketing and advertising, app development, and payment gateways, among other things. Many of these businesses serve clientele from other countries, particularly those in North America. According to e-Cab, there are roughly 550,000 freelancers in Bangladesh who offer eCommerce or similar services. Payments from abroad into Bangladesh are normally not a problem. Payoneer, established in the United States, is a popular service for processing online payments among freelancers in Bangladesh.
Popular Online Shopping Websites or E-commerce in Bangladesh
The followings are some of the most popular e-commerce websites in Bangladesh :
Online Payment System in BD :
As a result of increasing internet/mobile phone penetration, gridlocked traffic that discourages in-person buying and rising per-capita income levels, online payment is developing in Bangladesh. According to e-Cab research, more than 90% of Bangladeshi eCommerce users prefer the cash-on-delivery payment option. To simplify credit card transactions, most eCommerce company portals in Bangladesh have integrated merchant accounts.
Almost all eCommerce websites, however, provide a variety of additional payment options. Only a small percentage of eCommerce enterprises operate on the basis of only delivering products after obtaining payment by wire or bank transfer.
The Bangladesh Bank launched an online payment system in 2009, allowing for fund transfers and credit card payments for utilities bills. Since 2011, significant advancements in both financial transaction legislation (mobile payments, digital wallets, and smart cards) and transaction infrastructure have occurred (e.g., electronic funds transfer payment gateways). This sector of electronic payment processing services has already attracted both domestic and international investment.
Mobile E-commerce in BD :
According to the ITU, 88.1 percent of Bangladesh’s population has a mobile phone subscription. In Bangladesh, the country’s top mobile operators and banks enabled utility bill payment and remittance transfers by mobile phone in 2006 and 2010.
The government also granted mobile operators permission to sell train and bus tickets, as well as cricket event tickets. At the moment, 28 banks have received approval to provide mobile financial services. Cash-in, cash-out, merchant payments, utility payments, salary distribution, overseas remittances, and fund transfers are all available through mobile banking in Bangladesh.
Digital Marketing and Social Media in BD :
Digital media, in particular, has emerged as a powerful instrument for small and medium-sized businesses seeking to increase their brand recognition. Younger generations are more likely to use digital media. With rising mobile internet customers and digital infrastructure, more Bangladeshi businesses are engaging in digital marketing. The most popular services provided by digital companies are content creation and social media marketing. As video platforms mature, online advertising is gradually expanding. Restaurants, fashion stores, gadget shops, and lifestyle pages increasingly use digital marketing. Digital marketing has recently exploded in Bangladesh. How to engage consumers and achieve brand conversions using digital channels.
Again, social media is popular in Bangladesh. Facebook has about 29 million users in Bangladesh. In Bangladesh, over 8,000 e-commerce Facebook accounts are purely used to market and sell their products. YouTube is becoming increasingly popular in Bangladesh.