Amazon CEO Jeff Bezos has had the upper hand for sales of online goods for the better part of a decade now in the US, and with their bonus services like Amazon Prime and Amazon Air, the company is taking no chances when it comes to losing its lead.
But Amazon isn’t the only company pushing its digital strategy and America is not the only region who has taken to online sales.
In fact, Iranian Amazon-style companies have fought ferociously in recent years to offer the lowest prices and claim to have the quickest delivery periods. One of these companies is Datis Online, an e-retailer outfit based in central Tehran.
Current Issues in E-Commerce
Hadi Zomorodi, the company’s director who has been running the low-margin enterprise over the past four years, told the Financial Tribune in an exclusive interview that he could not directly import laptops and mobile phones due to some companies’ practices, namely Sazgar Argam, Vista and Avazang, the large importers that he believes keep the profit margins on importations artificially low to stave off competition.
Another serious issue which hampers the progress of his industry he said is the online payments industry.
The main issues are customer trust with online payment technologies, especially in small cities.
“It’s going to take time for people in smaller cities to get used to using this method as up until a couple of years ago it was unheard of outside a small group of technology enthusiasts,” he said.
Many websites online fail to support industry standards in terms of secure online payment systems and do not participate in industry wide programs like e-Namad —the online payment guarantee system—which hampers trust in the industry, he noted.
The computer salesman added that online identity theft is slowly rising in Iran as many people refuse to comply with ID certificates when purchasing online. He went on to say that his company alone has had to foot the bill for three cases of identity theft this year, with insurance companies unwilling to pay out after the incidents.
He said banks are connected to National Organization for Civil Registration, helping them find information disparities. “It would be helpful if we could connect to the NOCR or have a better way to identify people before taking purchases through online payment methods,” he added.
The Online Market
“Many people have entered and then pulled out the online business scene in recent years as they couldn’t keep their overheads down with the fluctuating rial,” Zommoradi said during the interview. “Merchandise prices are announced around 14:00 daily. If Datis sells something bellow price (price changes after sale to customer but before purchase by us), then we pay the difference, and take the loss, to keep our customers satisfied.”
When asked about growing price comparison industry in Iran he replied, “I have a distrust of these online comparison sites; the reason for this is many of the sites list items they don’t have or won’t stock just to try and sell the customers another item.
“Retailers often quote low prices; which they are unable to offer. This put off consumers from trying other retailers like us, who actually offer better prices.”
He also explained about his company’s future plans and what he thought the trends were overall. Zomorodi said that content is an important part of retailing these days, and simply listing items doesn’t do it anymore for the tech savvy Iranian consumer.
“Content is King,” he said, adding that he plans to add news and forums on his site to keep a loyal base of purchasers and return business.
For the market trends, Zomoradi stated that tablets have outpaced traditional laptop sales in 2014 as the price of tablets has been dropped.
Laptop sales have leveled off through the past Iranian year, he said. “We’ve noticed that Android sales have leveled off and the traditional business and home purchaser is coming back to the Windows system after a long time of dropping sales.”
