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What is the biggest challenge of e-commerce in Bangladesh?



What is the biggest challenge of e-commerce in Bangladesh?

There are an increasing number of E-commerce shops in Bangladesh due to rapid digitization. But the success rate is lower in comparison to that.

Here are some of the major changes that are slowing down a profitable sector like E-commerce.

Top 8 Challenges of E-commerce in Bangladesh

You might think that less internet access is the only reason for that. Of course, it’s a big issue, but many more issues are related to business operations, trustworthiness, etc.

Let’s find out the details.

Customers avoid online transaction

One of the biggest problems for E-commerce businesses in Bangladesh is that customers are unwilling to pay online. Even if they buy frequently, online payment is hardly a primary option.

Additionally, our country has around 5 million debit and credit cards in use. But only 1% of card users use them to do online transactions. And the rest of the people take cash-on-delivery.

This is a noticeable problem because the online transaction process is a building block of successful E-commerces.

Difficulty in product sourcing

Product sourcing in Bangladesh is relatively unsmooth. Heard of Amazon or eBay? These are the two biggest E-commerce businesses.

From these platforms, you can order bulk amounts online. And it’s hard to tell that getting your products online is an advantage as you will also save a lot of shipping costs and time.

However, we don’t have this option, so we need to travel to places to stock products. As a result, it increases the prices of the products.

Although we have a local drop shipping option, most of the time, that affects the product quality. Consequently, it will ruin a brand’s reputation.

Identifying the target market

People under 30 are most comfortable with online shopping in relation to people older than that. So does this mean everyone under 30 is your target customer? Certainly NOT.

Since your product will have a specific customer group, you need to identify that group. Unfortunately, it’s hard to figure out your customer base in Bangladesh. And you already know the reason—offline shopping.

Therefore if your customers are purchasing online, you can sell online. So, this is another big challenge for E-commerce businesses.

Online payment systems are unreliable

You have learned that most people take in-person payment systems. One reason for that is that E-commerce businesses needed to provide secure and easy online payment options at the beginning.

For that, people can trust online payment gateways. This is why even if people gradually favor online payment, a lack of security stops people from buying online.

Lower conversion rate

One of the advantages of running an E-commerce business is that you can operate it in multiple places nationally. And there is a 2% conversion rate for successful E-commerces.

This means you can expect a higher conversion rate with the help of the right marketing strategies.

But that’s rather uncommon for Bangladesh. And we have a lower than 0.2% conversion rate! This is mainly because of the prevalent disliking of online shopping.

Low customer retention

E-commerce giants like Amazon have an amazing 93% of customer retention rate. Other globally established E-commerces have a minimum of 30% customer retention.

On the other hand, Bangladesh can’t even retain 10% of its E-commerce customers. One of the reasons for this is poor post-purchase service and ineffective marketing strategies.

Too many E-commerces cause market saturation

You must have noticed that there are countless online shops. Furthermore, we have some established E-commerce businesses too, such as,,, and a few others.

These two factors make the market highly competitive for new E-commerce ventures. Hence, if you plan to launch an E-commerce, consider these two market aspects and take steps accordingly.

If not, your E-commerce venture will be unsuccessful. Many E-commerces have already failed. So, this is another problem for starting an E-commerce in Bangladesh.

Unethical business policy

When the E-commerce business idea got introduced in Bangladesh, people opted for deceitfulness. As they were doing business over the internet, it was easier for dishonest people to take over the industry.

There are so many examples of people getting scammed. Also, some businesses didn’t have a return or refund policy, which is heartbreaking.

As a result, people lost trust in this industry after a while. This made the path to success way more difficult for E-commerce businesses.

To sum-up

Seemingly, it’s a chain reaction because it all started with bad E-commerce service. Other than these, people still aren’t comfortable with online shopping.

Nevertheless, many E-commerces have seen success despite these obstacles. If you are planning to start an E-commerce, you must approach with the right marketing strategies and business policies.

Read Also: Why Do Banks Need ERP Systems?

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