The online retail market’s share of the total retail transactions in Iran is a meager 4%, which is insignificant compared to other countries of the region, according to a report published annually.
In its report, Digikala examined the state of Iran's e-commerce and compared it with that of other countries.
“Although Iran was a pioneer in this field compared to regional countries, it is currently lagging behind. While online retailing has gained traction in Iran's e-commerce market over the past few years, its share is very small and only 4% of retailing are done online,” the report was cited as saying by IRNA.
According to the report, the main reasons behind this small share are the low amount of investment, lack of support for digital economy in terms of regulations and restrictions targeting the infrastructural needs of online businesses.
In addition, sanctions hindering the development of digital businesses, the absence of major international brands, import restrictions, soaring inflation and a decline in people’s purchasing power are among other reasons affecting online retail in Iran.
Digikala’s report indicates that the online retail share was the highest in China with 46%. It stood at 36% in Britain, 20% in Denmark, Turkey and Indonesia, 16% in the US, 15% in Finland, 14% in Sweden and Canada, and 5% in India.
Of the 4% share of online retailing from the entire Iranian retail market, 2% belonged to online stores and 2% to retail stores operating on social media.
Digikala, which accounts for 1% of the sales registered by online stores, also shared the results of a national survey themed "People's attitude toward Digikala” conducted by the Iranian Students Polling Agency in the 11th month of the previous fiscal year (Jan. 21-Feb. 19, 2023).
According to this survey, 31% of people have never made a purchase online and the rest have used an e-commerce outlet at least once.
When those who had never shopped online were asked the reason behind their reluctance, 49% said they want to see the product they are buying in person, 16% did not trust online stores and 35% admitted their lack of familiarity with online shopping.
In fact, those who did not trust online stores and needed to see the product first represented one-fifth of the Iranian population.
Asked about the main advantages of online shopping, 65% mentioned convenience, 58% cited time-saving, 47% referred to lower prices and 47% declared variety of products offered by shopping online.
Digikala’s national survey showed that clothing topped the list of products bought by respondents from online stores. It was followed by health and beauty products, books and stationery, home appliances and kitchen products, mobile phones and electronic products, sports gear and travel equipment, toys, industrial tools and grocery products.
Women were more inclined than men to buy grocery products, clothes, books, stationery, toys, health and beauty products, home appliances and kitchen products online. This is while men preferred to buy mobile phones, electronic products, industrial tools, sports gear and travel equipment through online stores.
The report noted that 36% of the respondents said the online shopping was undertaken by their children. This was threefold higher than those who said a parent made the online purchase.
Asked to specify the mode of payment, 66.8% of people paid online, 24.5% paid upon receiving their order, 3.6% used an electronic wallet (which system is charged by the user for making purchases) and less than 0.5% of customers paid with a gift card.
