In the last 8 years, I worked in 3 start-ups and also mentored 5 start-ups, and saw 100 other start-ups to start their operations. Unfortunately, most of them completely failed or just operating on a small scale or still trying to figuring out their revenue model. The most common reasons to fail are – run out of cash, couldn’t recruit the right team members due to budget, false traction leads to unnecessary expansion or no business model. This connects directly to the five startup myths that I am going to discuss today. So, let’s do it!
Myth#1 – You can raise money on an idea: This is 99% false. You need traction to raise money. Traction in the form of Revenue ideally or at least traction in the way of users the notion that you can raise capital to build the first version of your product or to recruit. You might be very lucky if you can raise even from an Angel investor with your idea only. So before raising money, try to achieve traction.
Myth#2 – CEO or Founder is the highest-paid employee: Shouldn’t be the CEO or founder/s the highest-paid employee in the company? Sorry but that’s not true. The founders may not be the highest-paid employee of the company, sometimes not even in the top 3 of the list. Company share value should be the motivation of the CEO/founder, not the salary.
Myth#3 – Fast Growth first, Profitibilty later: This is a classic one! All you’re worried about is scale and growth ratio. And the fact that you need to grow faster. As long as you have money in the bank and new investors are continuing to fund your operation. For the most part, if your company is growing fast, you will be able to raise more funding. ‘Fast’ has different definitions depending on the industry, but you are probably looking at tripling or quadrupling your revenue YoY.
But, what happens if you are growing at, say, 50% YoY. That’s not going to get investors excited and probably won’t get you that Series A or Series B funding. So what to do, well, two paths: A) Keep going full steam ahead until you win, or you die. B) Take a step back and get your company to a profitable state. The point is, the purpose of a company is to make money. Slow growth is better than dead. A challenge many startups comes when they’ve raised too much money. In that case, the pressure from investors to get an ROI on their capital might put you in a tight spot.
Myth#4 – You need to develop your own the tech solution: Until you are developing a business that absolutely needs a tech solution first to test the leap of faiths and/or hypothesis, don’t invest your all resources in it. For example, in Next Billion, when we were working in B2B retail eCommerce, we use Shopify to test the initial hypotheses and understand the core operations. Because our core hypothesis was whether the FMCG retailers will order from some company that is not an FMCG company and/or wholesaler. And then we use the call-center to test whether the FMCG retailers placed orders without seeing anyone in front of them. Because during the research period, we have identified that these 2 will be the huge behavioral change for them.
Myth#5 – Everyone is starting a Startup, I should start one too: Obviously you should start your own business but before that, you have to know why do you want to do it. As long as you know why do you want to do it, the rest will follow. But you have to be sure, why do you want to do it. The best reason to start a startup is to solve a problem you‘re passionate about. Passion leads to excitement, ownership, and the motivation to stick it out when it gets tough. It also makes it more likely that the problem you‘re solving is real and big enough.
Bottom line: If your gut tells you to go for it and there’s something you really believe in, then go for it. We need more startups, as they are the change agents that can save the world.
“Allah has already planed your life. If something goes wrong, it went wrong for a reason”.
In my whole life, I have noticed a pattern. Allah has granted almost all my wishes, but when the time is right for me, not when I wished for it. Now if I need anything, I ask to him and tell him to give me when he thinks that I am eligible for that. So far in my life, I am very much thankful to Allah (SWT) for his blessing. In 2020, there is also no exception.
When I left Jeeon in November 2018, I had no concrete plan what I will do in my career. I already had 10 years of experience and I am feeling that my growth is getting stagnant. I put myself in a silo, very comfortable with the position and I was very happy with that. I forgot that one has to be uncomfortable in order to be successful, in some ways. If one stays in his comfort zone! S/he would never do the things that one needs to do.Leaving Jeeon was the first step I had taken to break that comfort zone. Before leaving Jeeon, I had no full time opportunities in my hand, only a consultancy which can cover my 3 to 4 months cost. But I believe that the strength of an individual’s convictions in his/her own effectiveness determines whether he/she will even try to cope in difficult situations. And as I said, with the grace of Allah (SWT) I have joined Next Billion in March 2019, just after completing my 3 months assignment in Nathan Associates’ project BFP-B.
Achievement#1: B2B Retail eCommerce
At the end of 2019, we have launched B2B retail in Tangail. We launched the 1st prototype in 2 days. With 1 month learning, I have attended an accelerator event in Hong Kong. It was a great experience. Implementing B2B retail eCommerce was one of the challenging projects I have implemented in my life. Although due to unavoidable circumstances, we have to close the project for the time being but I have learned a lot from it. Some achievement of this projects is given below –
Establish the pilot operations of B2B Retail initiative with 1500+ rural retail outlets
Total revenue reach to $120,000 in 6 months, with an average basket size of around $60
Completed around 2000+ deliveries in 6 months
Designed a GPS based route plan for products delivery to last-mile retail shop in a cost-effective way
Designed both Online (eCommerce site) and Offline (call center) order management solution
In terms of learning –
Understood the buying pattern of rural retailers, specially union and below union market
Understood the smartphone using behaviour of these retailers
Understood the market dynamics like the alternative channels of procuring products, existing financial terms among wholesaler and retailer etc.
Understood the roles and value added by the existing market players. It’s really important because then you can plan and design your automated/semi-automated solution.
Achievement#2: Live Commerce
In 2020, I also got opportunities to implement couple of projects in Bangkok, Thailand and I have experienced the whole eCommerce ecosystem of South East Asia. Not only got the user experience but also met people from Lazada, Shopee, aCommerce and some eCommerce merchants. I am really amazed with the whole ecosystem, especially the return procedure and logistics facilities. After experiencing the whole ecosystem, my learnings plus realizations are –
We all know that if customers have to work too hard to find a way to contact the company to resolve their problem quickly, they will be dissatisfied and their frustration can go viral faster than lighting. However, if customers have issues resolved by customer service, you will see lower return rates, more positive motion of your companies on social media (even when there were problems), better online review and more customers.
The company should give enough authority to customer officer so that they can solve the problem for the customers, not just following some checklist and procedures.
The e-commerce marketplace should also be obsessed with this customer service. They should expects that their merchants will be similarly obsessed with the customers services to gain the confidence of the customers. For that, the e-com marketplace can incentivize their third party merchants who obliged that and can punish those who didn’t.
For marketplace third party merchants, it is critical for them to understand the company’s customer-service mindset to be successful.
Another thing really amazed me is the growth of Live Commerce in China and SEA. Live commerce is a combination of TVC or Asian Sky shop, plus Facebook live, plus an eCommerce platform, all rolled into 1 app. I wrote couple of articles on Live Commerce, and one of that was published in The Daily Star, the leading english newspaper in Bangladesh. You can find the article here.
Before 2020, I wrote few articles but in 2020, I have started it seriously. So far in 2020, I wrote 12 blog, and also I developed my own blog site, rashedunnabi.com. I have started my own blog site in May 2020. So far 1200+ visitors visited my site and all of these are organic flow. I didn’t do any SEO or Adwords or any social media marketing. 22 people also subscribe to my blog. In 2021, I am planning to post at least 1 blog weekly and promote my blog in social media. Apart from my own blog site, all of those articles are also published in other platform like Marketing in Asia, and Thrive Global.
Achievement#4: Active Networking in the time of Pandemic
Although due to COVID-19 we all were in lockdown and currently maintaining the social distancing, still I identify 2020 as the year of networking for me. Till 2019, my total LinkedIn connection was close to 2000 and 95% of my connections are from Bangladesh. And now at the end of 2020, total connections grows to just over 4000+ and 55% of them are from Bangladesh. I not only focus on the quantity, but also quality, like I actually met (obviously virtually) 80+ of my contacts in this year with whom I never met before. Mostly it was an intro call, knowing each other. I think I will continue this virtual networking activities in 2021 too.
I also joined Lunch Club and Cuppa Club. Both of the platform is actually is a super-connector that makes introductions for 1:1 video meetings. These platforms will get you connected smartly to professionals around the world based on your goals to help you form the personal connections you want. I also met very smart and passionate people through these platforms.
Since I left Jeeon, in last 2 years, the way I way I grew (also in terms of speed), I am really thankful to Almighty Allah and also to few of my friends (Tajdin, Chinmoy, and some junior friends), my colleagues (especially Oliver Gilbert, my mentor and boss) and some well wishers (especially Zahed Bhai, Rashed Bhai, Muhymin bhai, Sajid, Saif Bhai, Arafat and many more).
In last 1 year, the almighty has given me lots of opportunities to learn. In 2021, I will take a step back to make two steps forward. I will take a step back to reflect on my learnings, form ideas and courses of actions to attain my goals. I know that life is often unpredictable, so you have to be prepared even if things are going just fine at the moment. So I want to stay positive and have a clear focus on my goals. And Insha’Allah by the grace of almighty, I will reach my goals.
My father, Md. Muhitun Nabi! I lost him on February 9 ,2020 at 8:45 AM. He had no pre-existing condition except diabetics but it was also in control. But on night of February 8, he sudden stroked and we admitted to him hospital around 12:30 am and in the following morning, he left us all. It was a huge shock for all of us but in a sense I am happy, because he always wanted this type of sudden death.
My father may not be a highly successful man (in terms of materialistic wealth), but he lived his life fullest. He is my hero. He was a very religious man. He had a huge influence in my life. He always believe in me, he always told me that I will be very successful in my life (I guess every dad told this to his son/daughter). But the way he used to say that, it inspired me a lot. It also gave me strength to believe that yes, I can do it.
My dad retired as Principal of Government College of Commerce, Chittagong in 2004. He had lots of students who loved him for his guidance and honestly. With his limited income, he always tried to fulfil all our needs. In 1990 or 1991, I was 6/7 years old. We went to market and I saw a pair of cricket pads for kids (protective equipment used by batters in the sport of cricket). On that time, the price was around BDT 500, like BDT 5000+ in current time. I was a stubborn child, so when I demand anything, I need it, whatever it cost. My dad bought that for me after like I cried for 20-30 minutes. That was one of the best day in my childhood.
My dad was always serious about his job and responsibilities. He also loved to do gossiping with his student in the class and outside class. He used to tell me that his age is stuck between 16-22, as all his students in that age group. As he spend 6-8 hours a day with this group, so his age is stuck 16-22 years old. May be that’s the reason he was so progressive. I remember, at the age of 53-54, he learned how to operate computer and how to use MS word and type in Bangla bu using Bijoy (even still I don’t know how to type in Bijoy). He also loved to play Brian Lara 1998, desktop game. One of his favorite song is Habib’s “Din gelo”. He used to believe that it was a very religious song and I didn’t argue with him because actually it is if you think on that line.
From childhood, I was good in general knowledge and he was very proud of that. Interesting thing is, as a teacher’s child, he never pushed me or my elder brother to do good results. He was always concern about are we good in math and english. Even in my SSC or HSC, he never pushed me for distinction. He just told me to keep 1st class. Even in my BBA, he never pushed me for my grades but he was very happy that I had secured “performance based scholarship” in my BBA. Me and my elder brother, both of us graduated from private university. My dad completed his bachelors and masters from University of Dhaka, #1 university of Bangladesh. That’s why he used to say to me that I should try to University of Dhaka for my MBA, and I did it. On that day, he was more happy than myself.
From the beginning of my career, I have to travel a lot for official purpose. Every time before starting my journey, either I met him or called him for his blessing. Whenever I faced any hard times in my life, I used to talk to him and asked for his guidance. Most of the time, he told me to keep faith in Allah, Allah will show me the path. He was a very religious man, he hardly missed any prayers or even tahajjud prayer (also known as the “night prayer“, is a voluntary prayer performed by followers of Islam) since his teenage.
I gifted him a smartphone and within a week he learned how to use and he was a regular YouTube viewers. In September or October 2019, he called me one morning and told me that 2020 will be very successful year for me. I asked him why do you think that, he told me he saw a horoscope video in YouTube where an astrologer said that. We both laugh for a while on that. Today, I don’t know whether 2020 is successful for me or not but definitely the worst because I lost him.
I dont know whether I was a good son to him but definitely he was the best human, best friend and best dad to me. Please keep him in your prayers.
What is Live Commerce? Live commerce is a combination of TVC or Asian Sky shop, plus Facebook live, plus an eCommerce platform, all rolled into 1 app. Alibaba has started combining Livestream with eCommerce in 2016 and now it’s a USD 63 billion business in China.
In Bangladesh, sellers go on Facebook Live to promote items, respond to questions, and take instant orders. Some merchants/products attract larger crowds than others. On average, there are 100–200 live-streaming sessions performed in Bangladesh, which increased to 500+ during the festive season. Sometimes there are 1000–2000 viewers in each live session. Unfortunately, there is no reliable data on what amount of sales the merchant generated from each session.
Why Live Commerce is rising?
Human Elements: whenever you are visiting any eCommerce site, whether it’s Amazon, Best Buy, or Daraz, you will see all the information in the text (product info and reviews) or images. Live streaming has completely turned the way you can learn about a product online. Basically, it’s like a salesperson demonstrates all the features of the products, even sometimes in such a way that is not possible in a physical store. For example, in Live Streaming you can ask/see the host try 15–20 different colors of lipstick which is most of the time is not possible to do in physical shops. Moreover, you can also take advice from the expert (usually the host is an expert on the subject matters) directly.
Branding Ecosystem: Usually the brand needs to go to Google or Facebook or other social media platform to do digital marketing. However, Live streaming in eCommerce could be more effective than the current methods. In China, all types of brands have introduced live streaming in the eCommerce platforms. And the companies are giving more discounts to customers during live streaming to increase their viewers. So, more customers are watching live and buying products. As a result, more companies have started live streaming and more consumers have started watching live streaming to enjoy discounts and the cycle is going on and on.
Technology: Adoption of 4G increase the consumption of video content and the habit of mobile phone users. People now habituated to watch more videos than pictures and that’s why the rise of short video platforms like TikTok or Likee is on the rise.
Why Live Commerce Growth Will Continue and Brand should use it?
5G Technology: We all know that 5G enables a new kind of network that is designed to connect virtually everyone and everything together including machines, objects, and devices. 5G will make the internet more accessible, and an even smoother ride for those on mobile devices which lead to more consumption of video contents and also the introduction of augmented reality and visual reality in eCommerce.
More Product Categories Online: Live streaming will open the door for more product categories to become available online. In Bangladesh, items like furniture, jewelry (expensive one) car, and high-end electronics items are low selling items online because customers need more visual and experiential information to make a purchase decision and which is exactly Live steaming can offer. Live streaming is created the 3-dimensional aspect of online shopping — an interactive, mobile, and social shopping experience. The customer can say, I want to see the function of the TV or let me show how quickly the laptop/computer starts.
Supply Chain Efficiency: Live streaming will help to improve supply chain efficiency which will help to improve the product selling cycle too. Let’s assume, your store sells handbags, Today the product cycle might look like this — Design > Produce > Distribute > Display > and consumers make orders. From design to reach many users, probably it takes 1 to 3 months. And then you find out that the mass customers actually don’t like the products, or the products are not hit due to lack of some features. With Live Streaming, you can get the customers to feedback fast, what they like and what don’t, and what more they want, you can actually make the overall process very faster and efficient. You can also get a pretty good estimate of purchasing intent from the customer and estimate how many quantities you should produce.
Why eCommerce platform should include Livestreaming in their platform?
According to a survey conducted by wyzowl.com on online buyers, the majority expect to see an average of 6 photographs and 3 videos per product before deciding to buy. What’s more, 66% of users wishing to find information on products prefer to look at a short video. 84% of people say that they’ve been convinced to buy a product or service by watching a brand’s video. Moreover, People are twice as likely to share video content with their friends than any other type of content.
In May 2020, I have conducted a study on Factors Influencing Consumers’ Attitude Towards Online Shopping in Dhaka City, where the most 3 influential factors customers considered before purchasing from any online page/website are credibility and trustworthiness of the seller, clearly stated information on pricing and shipping and image and description of products followed by previous customers’ reviews and testimonials, clearly stated return policy and after-sales customer services. All of these factors can be addressed through Live Commerce. By showing the products live, providing information, and answering queries can increase the credibility of a seller. Moreover, during live, information like price, and shipping information can be explained properly to viewers and the viewers can ask if they have any queries. Moreover, there are more advantages to using video with eCommerce products –
It increases the amount of time the user spends on the page.
It increases the average amount spent per purchase.
It attracts new consumers with valuable content that answers questions.
It is taken into account by Google when determining search positioning.
It provides better click ratios and the content is shared more times.
Live Commerce can also help brands to –
Attract with a view behind the scenes. Behind-the-scenes live video is great for humanizing the business, but it also has an air of exclusivity, making it very engaging.
Close with a bang! Product launches are great events to stream if you want to boost sales. You can stream special programming in support of your flash sales, too.
Delight with extra valuable content. Provide that little extra to your customers with live-streamed training sessions or content centered around the community.
The worlds of eCommerce and live streaming are incredibly dynamic, especially where they overlap. Live streaming is great for e-commerce, even if the two are not a completely integrated solution in Bangladesh yet. So far, the overall live streaming in Bangladesh is still Facebook and Youtube focused and mostly used by Facebook merchants. Some brands are also doing live on Facebook but mostly for marketing and awareness purposes.
Live commerce is still a very early stage in Bangladesh. Ajkerdeal.com recently has launched the “Video Shopping” feature in their app which is kind of a step towards Live Commerce. Now need to see when the eCommerce platforms in Bangladesh start taking steps towards it. Combining this with low foot traffic on shops, as consumers feel more comfortable shopping at home, Live Commerce will get more popularity in near future. Those who get ahead will realize the benefits.
My introduction to F-Commerce industry happened when my wife started her own F-Commerce initiative. She requested me to set up few things for her like design a logo, design a loyalty program and obviously boosting the page and products. She was involved with F-Commerce since 2016 but started her own venture on 2017, Shopping Glowrist. She imports different gift items, cloths and accessories from Thailand and India and sell it through her page. On that time, I saw she sometimes used to live from her group (which has around 40K members) and page (around 42K followers). And that’s the first time I got introduced myself with this live streaming thing. From her, I knew that its now a new trends among F-commerce merchants to show their products on live. Potential customers can also ask questions about the products during live session and it reminds me about TVC or Asian Sky Shops but with more interaction from viewers end.
E-Commerce in Bangladesh and Facebook Live
Statista, a German research firm said recently that Bangladesh’s e-commerce market stands at $1.6 billion currently and will double to $3 billion by 2023 on the back of a digital foundation laid down by the government and a young and tech-savvy population. According to the Statista report, the online fashion market in Bangladesh is currently worth $598 million and it has the prospect to reach up to $1.24 billion by 2023. Electronic products amounting to $457 million and furniture and appliances worth about $196 million are sold online. The online sales of furniture and appliances will would go up to $352 million after four years. Online sales of toys and hobby products stand at $260 million and it can almost be double to $442 million by 2023. Now as the online fashion market which also incorporates makeup and skincare is one of the growing e-commerce market in Bangladesh, so the popularity of the Live Commerce will also increase as selling this products demand live streaming.
In Bangladesh, sellers go on Facebook Live to promote items, respond to questions, and take instant orders. Some products attract larger crowds than others. On an average, there are 100-200 live-streaming session performed in Bangladesh, which increased to 500+ during festive season. Sometimes there are 1000-2000 viewers in each live session. Unfortunately there is no reliable data on what amount of sales the merchant generated from each session.
Growth of Live Commerce in China and South East Asia
Globally, the new trend for online retailers is livestreaming, In China, consumers on Pinduoduo are using it to break into the $200 billion market for impulse and everyday purchases. The China Internet Report predicts China’s livestreaming market will reach 613 million users in 2020. That makes live commerce big business in China, with more than 900 live-streaming sites now allowing consumers to interact and buy from brands in real-time – a market that, according to forecasts by iiMedia, will reach RMB 916bn by the end of 2020.
If you don’t know who Viya is, you should. She is an internet celebrity in China who sells via live streaming on Taobao. In 2019, she sold $2.8 billion worth of goods. That is more than $5,000 per minute, a number that even China’s No.1 luxury shopping center located in central Beijing can only wish for. Lipstick Brother, Taobao’s #1 live streamer, tests 300 lipstick in 7 hours long livestream and sells 100,000 lipsticks per live-streaming session.
Live Commerce and Shoppertainment, an exclusive combo of live streaming, entertainment and eCommerce, will transform the online shopping experience for both merchants and customers.
E-commerce companies in South East Asia are taking inspiration from China’s ‘shoppertainment’ trend to sell goods during live streams. Lazada and Shopee are among those that believe live stream e-commerce shopping can greatly help brands and sellers can connect with audiences in South East Asia. Currently I am in Thailand, come here to implement couple of projects, experiencing the growth of overall live commerce in Thailand. I had the opportunity to visit Shopee and Lazada and talk to them and both of the organisation believes that Live streaming helps to bridge the omnichannel retail gap as consumers no longer need to visit a physical store to see a product, speak to a store attendant and fulfill the order.
Lazada has its own live streaming feature in the app, named LazLive TV. They also launched LazTalent show, where they search for new livestream stars. This talent show has been launched in Thailand and Vietnam, and soon in other markets, to encourage talents who may be experts in a certain field to shine online. More than 3,000 grassroots livestreamers and brand promoters have onboarded LazLive during the contest period. Another innovative LazLive addition is the launch of virtual tourism in Thailand, which brings viewers to meet the elephants at the Elephant Nature Park.
Shopee launched its Great Shopee Sale where it unveiled its livestreaming feature called Shopee LIVE in Singapore. Like Lazada’s livestreaming feature, users are able to chat with sellers, learn about products, and ask questions in real-time before buying them without leaving the app.
Taobao launched the live streaming feature 4 years ago, now dominating the market with $28 billion in sales in 2019. This number grew 150% year-on-year between 2017 to 2019. Despite the staggering growth, it only counts for 3% of Taobao’s entire GMV. Less than 30% of its merchants have tried the new way of selling, according to an executive at a data company we interviewed. The huge potential of this market attracted more players to join the race. Two emerging formidable rivals are Kuaishou and Douyin, the most popular short video apps in China.
In India, an app called Bulbul launched in November 2018 where customers can watch hosts present products live, ask questions about the product, place orders, and pay on the app. There is also Pesopie and Simsim where users can watch short-videos produced in local languages by influencers and buy products. Flipkart is also piloting a new social commerce platform called 2GudSocial, with influencer-led video commerce. It is aimed at consumers from small towns and lower-income groups.
There are few third party social sales provider too. Shoplus is one of the most popular in Thailand. Shoplus, an artificial intelligence (AI) social sales provider from Taiwan. Shoplus offers AI live sales tools and chatbots for Facebook commerce including an order management system that integrates Facebook payment and logistics with Thailand Post and Flash Express. During the New Year’s holiday, live social sales events numbered about 2,000 per week, doubling to 4,000 in February. Under the Shoplus system, about 1,200 Facebook groups of Thai sellers engage in live selling events till April 2020.
Problems faced by Live-Streamer in Bangladesh
Although Facebook Livestreaming is very popular among online buyers and sellers, unfortunately no e-commerce or social commerce platform in Bangladesh hasn’t gave focus on this new concept. Still the merchants are doing it in very traditional way. They show different products to the viewers, explain the usability, materials etc and if any viewer wants to buy the products, then they have to sent the screen shots of the products and message it to merchant. After talking to several merchants who sell products through live stream, I have identified few problems they faced –
Bullying from the viewers – sometimes its way too much and personal
Viewers can’t take the screenshots in real time. Then they have to wait till the live end and scroll the video again to find the right product. That’s why around 20% sales the merchant loss.
Sometimes, from each session, 100-150+ viewers placed orders. After the end of the live, merchant needs to accumulate all the orders and then match it with the available stock. If the stock is not available, then sometimes they have to face misconduct from viewers which is bad for their brand.
As there is no formal order management system on Facebook live, so sometimes, merchants missed orders or send wrong products to customers.
Sometimes viewers placed the orders in live comments, which is completely ignored by the merchant, again an order management issue.
Why Live-Streaming should be used in eCommerce platform in Bangladesh?
The customers’ ever-increasing demand for easy and convenient shopping gave rise to live-commerce. The frequent change in their lifestyle and online habits have made brands and influencers take advantage of live-streaming to enhance their online presence and increase revenue. Live streaming is a great way to build community, storytelling and engage with others in real-time. It builds out that know, like, and trust factor at a super-accelerated rate.
Shoppers are eager to spend bucks on platforms that offer them easy, faster, and innovative ways to shop. With such technology penetrating the retail industry, Live Commerce will become the new face of shopping.
Moreover, if the e-commerce platform wants to attract more merchants in their platform, they should give more ways to present their products to customers. Sellers can instantly connect with their customers through live streams that require just a mobile phone and a decent Internet connection. Sellers are able to address queries through the live chat function in real-time, eliminating the hassle of going through individual questions on item listings.
Live-commerce is a phenomenon that is grabbing the attention of every corner in rest of the world. The technical barriers to live-streaming are lowered due to increasing smartphones penetration and affordable costs with high-resolution front cameras. Moreover, in-app beautification making it easier for retailers to make aesthetic videos for buyers globally.
The future of retail with live streaming can easily be predicted at this stage. Live streaming is no more a mere branding platform. It has become a vital digital property for various eCommerce platforms that allow customers to directly interact with sellers and purchase items in real-time. There is no surprise that companies, whether big or small, are trying to integrate the live-streaming platform in their eCommerce business.
Recently I read the Google Smart Shoppers Research Paper, where they have clearly stated the trends that will define retail strategy over the next 5 years. Here I have summarised the findings of the study and also put some data and thoughts in relation to Bangladesh market.
Businesses likely never going through a more tough time like this as a retailer. For many the focus has been on survival, though some retailers have seen huge growth as they responded to unprecedented demand in new and unexpected areas. In. Bangladesh, it is known that online sales have increased by 70 to 80 percent compared to the regular time. And while the reality is that we may not have moved completely out of crisis mode yet, the time has come to think beyond the current context to get your business ready for recovery and growth.
E-commerce has revolutionised during the COVID-19 Pandemic. However, buyers are not buying all kinds of products yet. They are buying more essential products. According to e-cab, the e-commerce or online shopping market across the country has crossed TK 6,000 crore during this pandemic. Consumers are now shopping for all kinds of products including medicines, clothes, food are done from different online platforms. Although economically marginalised and lower-middle income families are still market oriented, middle class or upper-middle people are shopping more online.
According to the e-Cab, shoppers are mainly city-centric. 80 percent of e-commerce buyers are from Dhaka, Gazipur and Chattogram. Of these, 35 percent are from Dhaka, 39 percent from Chittagong and 15 percent from Gazipur. The other two cities are Narayanganj and Sylhet. Eighty-five percent of e-commerce users are between the ages of 18-34.
Retailers with a strong digital offering will gain additional sales in the next five years
Google Trends Analysis
According to Google Trends Analysis, although the current crisis accelerated digital adoption and online sales are growing, it’s expected that most purchases will still be made offline by 2024 (78% versus 22% share online). However, it may be more helpful to think not just about which channels consumers will transact in, but which types of retailers they are choosing. The research shows that retailers with a strong digital offering will gain additional sales in the next five years, even if customers choose to buy in-store. This emphasises the importance of seamless and integrated retail experiences across online and offline.
Online food delivery service foodpanda, in collaboration with retail brand Shwapno, have officially launched an on-demand grocery delivery service through its app across the country. Customers will be able to get frozen food, dry food, fresh fruit, vegetables and daily household necessities like soap and shampoo from Shopno, which will be delivered at their doorsteps through foodpanda.
Meena Bazar, one of the country’s largest supermarket chains, along with their offline and online services, has also launched mobile shops in the capital. It will serve customers near their homes at reasonable prices, without having to pay value added tax (VAT) on their purchases. The mobile shop, selling basic grocery items as well as fresh vegetables and fruits, was launched on Wednesday, initially covering parts of Dhanmondi, Gulshan and Banani at specific times.
Multichannel and marketplaces formats will drive 86% of sales growth in the next 5 years
Google Trends Analysis
3 Consumers Behaviour Trends will shape retail strategy
Looking at how retailers can prepare for this shift in market share across retail formats, Google Trends Analysis Report has identified three key trends. These consumer behaviour insights can help retail companies to develop their marketing strategy to drive long-term success.
As consumers shop both online and in-store, multichannel (which includes physical-heavy and mixed retailers) and marketplace formats will drive 86% of the sales growth in the next five years. During the festive season in this year, we have also seen strong online presence by the fashion houses in Bangladesh.
The pandemic has made consumers more fluid about whether they buy online or offline, with 73% describing themselves as channel agnostic (up from 65% before the crisis). Consumers will expect a more blended and seamless experience as they continue spending across both channels.
As purchase decision-making becomes more messy, consumers also expect to have helpful information to make their own decisions, including competitive pricing, recommendations delivered in moderation, and helpful personalisation. I believe still Facebook merchants has a good contribution in the online sales due to the trust they have gained and also they provide more information like regular live stream and positive customers review, which actually help consumers to make informed decision.
How to prepare for the future of retail
In the next five years, retailers will need to bring together their digital and in-store experiences to make the biggest gains as consumers will continue spending offline but as online spend continues to grow. Consumers will favor retailers with a digital offering, even if they go on to transact in-store. As during this pandemic, we have learned that the only constant is change and retailers must be ready for what will come next. Here are a few of my thoughts –
1. Consumers have now a lot of choices. Retailers should help consumers make empowered decisions by providing helpful information to make their own decisions. This will increasingly become a key differentiator.
2. The future of retail is not about an either/or when it comes to physical or online presence. Retailers will need to move on from focusing on where the transaction is happening and refocus on integrating online and offline experiences.
3. Retailers need to meet rising consumer expectations and deliver seamless experiences. This means there is no going back from investing in digital transformation.
This current pandemic has increased the uses of online technology and lots of companies has introduce new online services to adapt with the crisis. While businesses that are not yet well adapted to the digital world may find it more difficult, it can offer the opportunity to make these necessary and fundamental changes to the way their businesses operate. There is still time to pivot, introduce new services based on technology and think big, but it is the time to transform and grow.
Currently, I am doing a course on Digital Business Model on Coursera. In one of the lectures, I encountered the term Asymmetric Business Model. The Asymmetric Business Model is a business model that crosses industries, by forcing profits to migrate from one industry into another. Asymmetric business models are based on the economics of complement. Let’s see how complements work. In economics, a compliment is a good that is dependent or requires the use of another product. Let’s see some examples. Home printers depend on ink cartridges to work. So, cartridges are a complement to printers and vice versa. Cars depend on gasoline fuel to work. So gas is a complement to cars and vice versa.
The economics of complements says that when you reduce the value of the complement, the demand for the product increases. When you reduce the value, that is the price of printers, more people will buy printers, and therefore, more people will buy cartridges. Similarly, when you reduce the value, that is the price of gas, more people will buy cars.
To understand the concept more clearly, let’s say that companies could grow their business either –
Diversify, which means branch out into new markets by investing their profits into that new market, and try to turn that new market into a source of profits in its own rights; or…
Grow asymmetrically, which means branching out into a new market with the intention of not turning huge profits within that new market, but rather to drive profit in the core market.
When the complement is commoditized, the demand for the product is increased. Let’s now see how companies use complements as part of their business model. To do that, we will overlay the architecture of a business model with three examples, using the economics of complements, Apple, Google, and Amazon.
Apple creates value by making it easy for software developers to create millions of apps. Apple has therefore commoditized apps by making it easy for anyone to build and distribute an app, and encouraging price competition among developers. In turn, these apps are the reason why users buy iPhones, iPads, Apple TVs and Apple watches. Therefore, reducing the value of apps drives the demand for its core product, which is devices.
Google creates value by making it easy for handset and tablet makers to build smart devices. The open-source license version of Android is distributed at no cost to the handset makers. Therefore, by commoditizing Android, Google is effectively driving the demand for its core advertising business.
Amazon creates value by making hardware such as Kindle Fire tablets and Echo devices available at cost. In turn, these devices are bundled, which is locked to Amazon e-commerce services. Effectively by commoditizing Kindle Fire and Echo, Amazon is driving the demand for its core e-commerce business.
In a nutshell, the Asymmetric business model consists of 3 major components –
A company identifies a complement in a different industry.
Value is created by commoditizing that complement.
The complements are bundled with a core product of the company, ie where profits are generated.
If you think about business strategy for your company, I recommend testing this model. Let me know what you think!
According to a german research firm, Bangladesh’s e-commerce market stands at $1.6 billion currently and will double to $3 billion by 2023 on the back of a digital foundation laid down by the government and a young and tech-savvy population. The knowledge on the factors affecting buyers’ behavior, the relationships between these factors and the type of online buyers would give assistance to the e-marketers in evolving their marketing strategies which will ultimately help to grow the industry.
This paper focuses on factors influencing online buyers’ attitude based on the evidence from buyers of Dhaka city. It also investigates how different types of online buyers perceive different important factors before buying anything from online and also their spending amount on online shopping. Data used in this study was obtained using an interviewer-administered structured questionnaire on 128 respondents, selected randomly having experience in online purchasing. According to Facebook users data April, 2020, 77% of users in Bangladesh lies between 18-34 years age group. That’s why this survey also focus on the people between 18 to 40 years old age group. The data was collected from May 5 to May 16, 2020.
Around 90% of the respondents from 23 to 37 years old age group. Around 50% of the male respondents belongs to 33-37 years old age group and around 45% of the female respondents belongs to 23-27 years old age group. The majority occupational group is private job holder followed by graduate students. These 2 groups hold around 75% of the total respondents.
Around 96% of the respondents has responded that they have purchased at least once from Facebook based business or from an E-Commerce website in last 3 months. Among those 96%, around 41% are men and 59% are female.
Around 23% respondents purchased regularly and frequently from online in last 3 months. However, only 17% of male respondents purchased regularly and frequently. On the other hand, 28% of female respondents purchased regularly and frequently. Around 80% of the male respondents purchased occasionally or rarely from online. On the other hand, around 68% of the female respondents purchased occasionally or rarely from online.
Age group from 23-27 years old respondents purchased most regularly from online followed by the age group of 33-37 years old. On the other hand, age group 33-37 years old purchased most occasionally followed by age group of 23-27 years old. Although only 5 respondents responded that they didn’t purchased anything from online in last 3 months, there is no respondents from age group 18-22 and 23-27 years old in this category of respondents.
Two major groups of respondents are graduate students and private job holders. These two groups consist around 75% of total respondents. 71% graduate student respondents responded that at least one a month, they purchased from online. Around 85% of the graduate students lies in 23-27 years of old age group and around 71% of the respondents of graduate student group are female.
On the other hand, 45% of the respondents from private job holder group responded that they purchased rarely, once or twice in last 3 months from online. It is important to mention that around 60% of the private job holder group respondents are male and total around 38% male respondents responded that they purchase rarely from online.
The respondents were asked that whether they have purchased from online (either from e-com websites or facebook pages) in last 3 months, which means during January 2020 to March 2020. In terms of gender distribution, there is no visible differences between the responses from male and female, around 96% of both male and female responded that they purchased at least once in last 3 months.
Around 62.5% respondents responded that they purchased at least once in a month in last 3 months. Around 68% of the age range from 23-37 years old responded that they have purchased at least once in a month in last 3 months. It seems like graduate students and private job holders, 23-37 years old respondents are more consistent purchaser from online than other groups. According to Facebook users data April, 2020, 77% of users in Bangladesh lies between 18-34 years age group which complies with the findings from the study that these age groups of people are regular users of internet in Bangladesh.
Fashion accessories, Clothing and Groceries are the top 3 preferences of products while the respondents were asked about the preference of products they usually purchase from online.
Fashion accessories (incorporates shoe, watch, sandals, sunglasses, bags etc) is the most preferencial products among the respondents for online shopping followed by clothing and groceries. There is a very marginal difference between Groceries and Cosmetics items. So, it may conclude that Fashion Accessories, Clothing, Groceries and Cosmetics items are the top 4 categories among the consumers for online shopping.
However, if we look into the gender wise preference, male respondents top 3 preference products are Fashion Accessories, Groceries and Gadgets. On the other hand, female respondents top 3 preference products are Cosmetics, Fashion Accessories and Clothing. Online shopping tends to grow in the coming years as consumers want to buy more in the future. Merchants should bring out innovative ways so that there is a growth in other categories of goods and services.
Around 75% of the respondents responded that they have spent maximum BDT 15,000 on online shopping in last 3 months. The majority respondents, around 41% spent maximum BDT 5000 in last months.
Around 70% of the male respondents spent maximum BDT 15,000 in last 3 months and around 80% of the female respondents spent maximum BDT 15,000 in last 3 months. Around 15% of the male respondents and 13.33% female respondents spent BDT 25,000 in last 3 months. So it might be concluded that women spent more money in online shopping compare to male.
50% of the respondents who responded that they purchased from online on regular basis, spent more than BDT 25,000+ in last 3 months. There is no significant difference in responses from the respondents who responded that they purchased from online at least once in 2 weeks. Around 75% of the respondents who respond they do online shopping rarely (1 or 2 times in quarter) spend maximum BDT 5000. It is evident that the spending on online shopping is directly related with the frequency of shopping. It also evident that perceived ease of use which comes from experience helps to adopt the online shopping.
There are some respondents from occasionally and rarely group (6.25% of total respondents), who spent more than BDT 25000+ in online shopping, mainly purchased gadgets like mobile or electronics goods like TV. As fashion accessories (incorporates shoe, watch, sandals, sunglasses, bags etc) is the most preferencial products among the respondents for online shopping, might have a positive relationship with the spending amount.
The most 3 influential factors customers considered before purchasing from any online page/website are credibility and trustworthiness of seller, clearly stated information on pricing and shipping and image and description of products followed by previous customers’ reviews and testimonials, clearly stated return policy and after sales customer services.
Interestingly, only around 6% respondents respond that they also consider website’s visual appeal and free delivery before making any purchase.
Among the male and female respondents, the top 2 influential factors are same, credibility and trustworthiness of seller and clearly stated information on pricing and shipping. The 3rd most important influential factors for male are images and description of the products. For female respondents, the 3rd most important influential factor is customers’ reviews and testimonials.
The top 3 factors for not buying from any Facebook page or E-commerce site are Unavailability of Product Description, Poor Communication System with Seller and Advance Payment for the products. The customers don’t want to pay advance as they want to be sure about the products quality and condition. Also if the communication methodology with the seller is not easy, then customers also decide not to buy from that seller.
For men, poor communication system with seller is the prime factor. On the other hand, advance payment for products is the biggest factors for not purchasing products from facebook page or e-com website.
Around 52% of the respondents respond that they have very good experience with the online shopping so far. However, 43% of the male respondents told that they have very good experience. On the other hand, 58% of the female respondents responded they have very good experience.
Around 15% of the male respondents have below average or very poor experience, where only 1.33% of female respondents have the same experience. It’s need to mention that male respondents mostly buy products from e-commerce website than facebook based seller. The reasons for poor experiences are related to delayed delivery, physical product is not matched with the picture and got totally wrong product.
As stated earlier that this paper focuses on factors influencing online buyers’ attitude based on the evidence from buyers of Dhaka city. The findings of this paper provide a guideline to merchants about the areas they need to be focused and the attributes they need to be incorporated in their services. If the companies and merchants consider these factors, they might have a competitive advantage in the market.
Based on the findings from this paper, the author will published few other articles on how the e-commerce companies and Facebook merchants can design their services accordingly and what are the international best practices considering these findings.
In this moment of crisis, when going to hospitals are potential spreaders and the inability to physically consult doctors has emerged as a crucial obstacle for patients seeking medical assistance. The need for “Telemedicine” is very essential now more than ever. I am really happy to see that organizations like Pathao, Shohoz, Prava Health, Pulse One, Digital Healthcare Solution, etc, and private hospitals like Square and United have also come with telemedicine/tele-consultation solutions to solve this problem.
From October 2015 to November 2018, I worked for Jeeon Bangladesh Limited. At that time, Jeeon had a telemedicine platform that bridges the divide between rural patients and quality healthcare by providing local intermediaries with the training and equipment to facilitate meaningful consultations with remote doctors. I was the Head of Operations of that Telemedicine Program till 2017. Jeeon had stopped the telemedicine program due to numerous implementation challenges that can’t be solved by Jeeon itself. Moreover, the readiness of the market is also an important factor in that time too. In this article, I am going to share the challenges that we faced during the time of implementation.
To take the service of the Jeeon Telemedicine program (under the brand name of Projotno), a patient only had to come to the nearest drug-shop-cum-Projotno-centre in his/her nearest bazaar. Then the rural pharmacist of that center took his/her problem, history, and some primary vitals like weight, blood pressure, blood glucose, etc and send that information to a doctor by using Projotno Telemedicine App and requested an appointment with a relevant doctor. For example, if the patient come with a skin related problem, then within minutes, s/he was connected to a dermatologist sitting in Dhaka, who after reviewing his/her symptoms and pictures of his/her skin and talking to his/her, sent his/her a prescription over the internet. The prescription was printed out with the doctor’s e-signature, and she could walk away with the required medicines within 30 minutes.
We deployed 42 franchisees of Doctor-in-a-Tab across 4 Upazilas (subdistricts) in Northern Bangladesh (Netrokona and Kishoreganj) over the course of two years of experimentation, and through them served nearly 10,000 telemedicine patients. We chose unions that have a minimum population threshold of 20,000; thus 36 centers had a catchment population of ~700,000+. The pharmacies were located in the well-established middle to large scale markets with at least 50 shops and >=5 pharmacies, ensuring they were frequented by patients from all neighboring villages, there were strong network and road connectivity, and relatively stable electricity.
The price of each conversation is nearly USD 4, which expectedly was beyond the reach of the poorest income quintile of the population, but it served other underserved segments like children, elderly and female patients (60%+). Our target clients were patients in rural Bangladesh that reside at least 20 KM / 1 hour away from a major urban or medical hub, thus without direct access to qualified doctors, and earning between USD 64-260 per month per household (not the extreme poor). All of our selected centers were in Bazaars that were 10-35 kilometers from the nearest urban hub. In the typical setting patients in these areas incurred large opportunity costs such as transportation cost, doctor’s fee, prescription costs, diagnostic costs, etc. traveling to towns (amounting to upwards of USD 25), hence we expected that they would prefer an alternative of visiting a “Dhaka Doctor” at their next-door pharmacy for <USD 10 per visit (including prescriptions). This assumption was partially validated since we have been able to serve ~10,000 patients in the course of the last 2.5 years.
We also initially assumed that because RMPs are invariably male, we would serve a mainly male clientele. However, to our surprise, we found that a majority of our patients were female. We attribute this unexpected finding to the fact that male patients have more freedom of movement and mobility and hence can visit the town for care by themselves, whereas female and other less mobile customers (children & adolescents – 24%, elderly – 20%) tend to rely on the pharmacy for all kinds of care in the absence of financial means and mobility to travel. Therefore, this intervention was reaching the most marginalized and underserved segments of the population except the extreme poor.
Challenges: Difficult and expensive to deliver results consistently with telemedicine
When we launched, we expected remote consultations with doctors to solve the key challenge of rural primary care – bridging the quality gap inaccurate diagnosis and treatment. In reality, we found that delivering a consistently accurate diagnosis and treatment was extremely challenging.
First of all, doctors required more diagnostic tests than usual to diagnose problems accurately because of the inability to touch and examine the patient themselves. But due to the lack of diagnostic facilities nearby, patients would often not follow up with a diagnostic test. Moreover, if they have to go to the city to do the diagnostics test, then they can also take doctor consultation from there. So the lack of diagnostics facilities in rural areas was a huge challenge we faced.
Secondly, even when a patient was diagnosed accurately, sometimes the medicines were not available at the pharmacy due to poor supply chains or inadequate prior demand. Our field staff went out of their way to deliver uncommon medicines to our centers, but it became unmanageable and costly to sustain that long term and at scale.
Thirdly, many patients required treatment beyond just medicines, such as procedures and surgeries. We chose not to charge these patients for the referral advice we gave them, but because there were very few quality hospitals and clinics nearby, we could not endorse any particular referral facility which disappointed patients. Patients also did not like to be told to go to the town after coming to our pharmacies with the hope that the problem would be resolved locally.
So, ensuring only good doctor consultation is not the only verticle that needs to be solved. To launch successful telemedicine, other verticals like diagnostics tests, availability of medicine, and referral services should be formed.
There was also some demand-side barriers like due to a lack of health awareness and education, there is very little understanding of the concept of “quality” in healthcare. If a patient feels better from a stomach ache after taking a high-dose painkiller, they often would prefer that service over a doctor who diagnoses it as simple indigestion and asks the patient to sleep it off. Therefore, it was a huge behavior change for people to opt for an expensive doctor consultation when they could spend one-fifth of the amount on a few low-quality pills. Moreover, by the time a patient delayed care-seeking and self-medicated a few times with no results, the problem had often escalated beyond the ability of doctors to treat remotely, and referral was the only option, which was in turn highly unpopular with patients.
What we have attempted to adapt to the challenges?
Diagnostic sample delivery:In order to mitigate the challenge of diagnostics, we initiated a pilot in partnership with a diagnostic center in Kishoreganj called Health Aid. Under this pilot, patients would deposit their samples (blood, urine and stool) in the center and a representative from the diagnostic center would pick them up at a specific time of the week. When the samples were taken and reports were generated, the reports will be delivered back to the same pharmacies. This also would include a discount for patients.
What we found in practice was that in most prescriptions, blood/urine tests were accompanied by radiological investigations like Ultrasound or X-ray, which meant that the patient had to travel in person anyway.
Dermatology specialization:We had found from the first few months of the pilot that dermatology as a specialization was generating much better Positive Patient-Reported Outcome (PPRO) measures than general practice cases. This was due to the fact that dermatology is a largely visual illness, and can be diagnosed with a high degree of confidence from pictures alone without relying on a lot of diagnostic tests. We decided to hire more dermatology specialists and market the service as a dermatology specialty service. We were trying to see if we could get a higher patient flow per-center if we did that. We found that while we got a bigger share of dermatology patients after the marketing, the total patient volume did not increase by much, which indicated that we had already saturated the limited demand for telemedicine in the market.
I am really happy to see that in the last couple of years now lots of organization is coming with a solution for remote consultation. Moreover, the whole process expedites due to the Covid-19 situation. However, most of the solution is focused mostly on urban or only doctor consultation part. However, if someone wants to build a robust remote doctor consultation, s/he also needs to focus on the other 3 important verticles – diagnostics test, medicine availability and also referral services.
Yesterday I have completed a course on LinkedIn Learning on Personal Branding. There was a topic on how to develop your personal brand website which I really enjoyed and learned a lot. I just want to share some gist of that chapter with you all.
Before starting the topic, it is important to know that Everyone, in any industry, and in any stage of their life or career can benefit from a website. Why? Because creating your own website allows you to take control of your image and message online. And now it’s easier than ever, thanks to tools like WordPress, Squarespace and Weebly to create your own website. You just need to pick a template and know the right things to add to your site to make it pop, drive traffic, and convert leads.
Now here are the six important things you need to incorporate in your personal brand website –
1. A well-branded home page: Means when people land on your site, you want them to understand who you are, what you do, and where to click next. Your homepage could be the only opportunity you have to hook someone, so be sure to include an image of you, establish credibility, and insert a call to action. That call to action could be to join your mailing list, to watch a media segment, to register for your webinar, or maybe to book a discovery call with you.
2. Samples of your best work: Think of your website like it’s your living resume, where clients, agencies, and followers can view your best work. If you’re a writer, publish clips to articles that have been published, photos of print articles, or links to books you co-authored or wrote. If you are a marketer, include information about your achievements, the projects you have launched, or the video of the campaign you have designed or implemented.
3. Your Social Channels: Your personal website isn’t the only real estate you have on the web. Most of you probably have another profile or multiple accounts on either LinkedIn, Twitter, Instagram, or Facebook. Ultimately, you’ll want to link all of your active and branded social media channels back to your personal website, especially which are relevant to your professional life.
4. Blog: A blog allows you to further establish your voice as a thought leader, engage with your audience, and, it’s a great way to drive traffic to all of your channels. A blog can also have benefits far beyond brand awareness. It could help you land a job, a partnership opportunity, an interview request, or new clients.
5. Testimonials: Testimonials prove your worth, your credibility to others, and your personal brand value to others. Having positive testimonials in either written or video format can absolutely increase trust, interest, and sales.
6. Contact Form: A contact form can automate many of the functions that would otherwise need to be done manually, like adding subscribers to an email list, responding to a new lead with the right information, or forwarding a message to you. Don’t miss out on the opportunity to connect with a new lead, or partnership by not having a contact form optimized on your website.
After completing the course, I couldn’t resist myself to develop my own personal website. You can check it and give your feedback – rashedunnabi.wordpress.com
In Bangladesh, financial exclusion is widespread. According to the World Bank’s Global Findex database, only 50% of Bangladeshi individuals above the age of 25 have a bank account and only 13% borrow from a formal financial institution. Emphasis placed on financial inclusion by the United Nations has motivated many developing countries in Asia to facilitate and develop their microfinance sectors. Bangladesh, Pakistan, and India are known to have large, inclusive, and vibrant microfinance sectors. In Bangladesh, loan amounts up to Tk. 50,000 ($637) are usually considered as microcredit by Microcredit Regulatory Authority (MRA), and loans more than this amount are considered microenterprise loans. Both types of loans may be provided by microfinance providers.
Although the lowest ceiling of ME loan is BDT 50,000 set by Bangladesh Bank, the average size of ME loan disbursed by Banks is BDT 680,643 (Bangladesh Bank Category wise Quarterly CMSME loan Disbursement Statement, January 2018 to September 2018). The gap between the lowest ceiling and average size of the loan is due to several reasons like banks do not have the requisite information and systems in place to quantify risk and differentiate between SMEs. Moreover, banks need more organized and granular information of the MSE to understand its business and creditworthiness but most of the MSEs have lacked in terms of this information. Another factor is the issue of moral hazard, wherein SMEs are perceived to take higher risks than larger companies with funds borrowed from banks.
MRA defines MEs on the basis of loan size. Any microloan of more than Tk. 50,000 is termed as micro-enterprise loans. Usually, ME loans are considered for those ‘graduates’ from microfinance programme who want a higher amount of loans to run their own informal businesses for which traditional microfinance does not have provisions. Although there is no general consensus about the upper limit of the loan, however, it can reach up to Tk. 1,000,000. The average size of ME loan disbursed by MFIs is BDT 135,577 (according to the data of MRA publication, NGO-MFIs in Bangladesh 2016). The main reason behind this is that there is no standard definition of ME loan for MFI which needs to be revised. Moreover, the high cost of funds from commercial sources also hampering the growth of the ME loan portfolio for MFIs.
As most of the ME loan borrowers are graduating from micro-credit and eventually they grow more and now in a place where their financials need are not fulfilling by both Banks and MFIs. As mentioned above, the average size of the Bank ME loan is BDT 680,643 and the average size of ME loan provided by MFI is BDT 135,577. The MSEs who need loans between Tk. 200,000 to Tk.600,000 are addressed neither by MFIs nor by banks and these MSEs fall under the ‘missing middle’ category. To address the ‘missing middle’ MFIs need to upscale and banks need to downscale their ME lending. The study conducted by BFP-B ‘Diagnostics of Micro-enterprise Lending by MFIs in Bangladesh: Opportunities and Challenges’; estimates that total demand for ME loans in 2015 was Tk. 737 billion. Total ME loan outstanding by MFIs was Tk. 123.27 billion and that of banks was Tk. 176.65 billion. So, the total loan supply to MEs was Tk.299.92 billion and therefore the demand-supply gap was Tk. 437.39 billion in 2015. The demand-supply gaps exist because MFIs are unable to upscale and increase ME lending because of MRA Rules and banks are unable to downscale and increase ME lending because of inadequate outreach and human resources in the rural areas.
MEs loan requirement from the banks and financial institutions is contradictory by characteristics – one is MEs’ requirement for the loan is considered too high compared to traditional microcredit offered by the MFIs; secondly, MEs’ loan demand is too small for the conventional banks and financial institutions which requires collateral and referral. MFIs can play a pivotal role in supporting MEs in rural areas. Though scaling-up microcredit to support growing MEs with diversified loan package has not been forthcoming as expected. However, under the current policy framework, MFIs are still the major collateral and referral free loan providers to MEs. In this backdrop, MFIs are also facing multiple difficulties in providing loans to MEs because of the definition of ME loans by MRA, and restriction on saving mobilization and ME loan outstanding by MRA. In addition to this, the absence of comprehensive and harmonized policy guidelines, legal framework, and ecosystem building among regulators restricts MFIs to support progressive MEs.
According to MRA Rules 2010, the ME loan outstanding of a MFI cannot exit more than 50 percent of the total microcredit loan outstanding of that MFI. The MFI especially the top 10 are unable to increase their ME loan portfolio because of MRA restriction. Moreover, MFIs are unable to mobilize deposits from their members through voluntary and term deposit products because of MRA restriction on savings mobilization.
Note: This is a gist of the article I co-written with Former Senior Secretary, FID, Md Eunusur Rahman for BFP-B.
I hope that the coronavirus situation is certainly not going to change the world forever, but it is going to change quite a few things, in some cases, the change might be forever. Below I have predicted 3 of those changes in retail, food and real estate industry.
In urban areas, online shopping was already slowly killing retail shops. The lockdown/self-quarantine will force people who rarely or never shop online to do it all the time. Once customers get used to shopping online, most of them won’t go back, so retail jobs will be disappearing twice as fast. And now lots of businesses are coming to the retail delivery business, Priyoshop, an e-commerce platform that starts delivering daily necessity goods and healthcare products. Pathao has also introduced grocery and medicine delivery. A couple of days back I run a poll in my wife’s e-commerce Facebook group (which has 40K+ members) where I found that around 38% of people (around 500 people participated the survey) start buying groceries online during this lockdown period.
For restaurants, it will be more take-aways and home deliveries, fewer people on seats. Habits will change, and a lot of people won’t come back afterward. Food sold out the door generates much less cash flow than food served at the table, and half of the waiters’ jobs are gone. There will be a severe cull of restaurants and the rise of the ghost kitchen. In Thailand, the food delivery industry has been riding a wave since last year. KResearch (a division of Kasikorn Bank) reported the food delivery business in 2019 was worth 33-35 billion baht, up 14% from the previous year. Most delivery operators interviewed by the Bangkok Post say their work has increased at least 100% since the COVID-19 executive decree came into effect on March 26 which bans sit-in dining but allows restaurants to sell takeaway food.
Once it becomes clear that remote working actually works for most jobs, it will start to seem normal for people not to go in to work most days. So a steep drop in commuting, lower greenhouse-gas emissions, and eventually a lot of empty office space in city centers. Read an article in Forbes that nearly three out of four finance leaders surveyed earlier this week by Gartner, a research and advisory firm, said they plan to move at least 5% of their workforce that had previously reported to an office to a full-time, remote schedule.
Let me know what’s your thought on these changes that I anticipated.
From the very beginning of my career I tried to become as much organized as possible. And that’s why I have read a lots of books, articles and blogs related to personal productivity and efficiency. Based on all the learning I got from these books, articles and blogs, I have developed my own recipe to be more productive in the work. Yes, I also maintain a daily To-Do list and reflect in the end of the day and again focus on the preparing the To-Do list for next day but the most of my plan is depended on the plan I developed on Saturday night (Yes, in Bangladesh Saturday is the Sunday!).
The following steps I follow to make the Saturday Night, most productive night of the week –
Usually around 9 or 9:30pm of Saturday night, I grab a cup of coffee and sit in my desk. Before that I make sure my desk is clean and tell my family members not to disturb me for next 30-40 minutes.
Gather my notebook and open my calendar and Evernote. I am big fan of physical notebook but I also use Evernote for quick thoughts and notes.
I write down the overall goal of the week. Make sure you also put not only your professional goals, but also your personal goals. If you done have any goals, no problem. You can focus on the projects you are planning to do in coming week.
Fill in the specific tasks under each of the projects. Please note that there might be some projects which were carried forward from last week. Please also considered those projects and the unfinished tasks.
After listing down all the tasks, decide which tasks need to be done on Monday, Tuesday etc. If possible, highlight the each day with different color highlighters.
Then open my calendar and Microsoft To-Do app to list down all the tasks and reminders. I also send meeting requests which I need to do in the coming week.
Then review the tasks and the goals and make sure those are aligned.
I hope my way of planning the week will help you all. Don’t forget to account your personal projects / tasks in this plan, else your overall plan might get hampered.
Please feel free to share your planning process too so that I can learn from your too.
The term Business Development is difficult to define as companies tend to modify the scope of work of that role based on their unique needs. In some companies, business development means sales, but more often, business development means a bunch of activities to generate leads to fill the pipeline for the salespeople. Among those bunch of activities, partnership development is one of the best ways for a business development person to generate enough leads to impact that pipeline. Sometimes it takes time to develop partnership but the time invested in developing the partnership pays off in spades over time.
Business partnership is important for all companies but it is really important for those companies who has launched new products in the market or really need to increase the efficiency in the processes like in operations or growth. Through partnerships with companies that have the tools and audience to help you grow, you can create much more impact in a shorter period of time. These organizations have spent years building their reputation. Aligning with them in a smart way will enable you to tap into that reputation and give you the tools you need to thrive in a new market or operates more efficiently in new market.
I worked as a Head of Business Development at JITA Social Business (a micro-distribution company, which developed a network of sales ladies in last mile) from 2013 to 2015. During that time, we have developed a partnership with SHISEIDO, a premium japanese cosmetics company developed a partnership to test and launch one of their product in the rural Bangladesh, Les Divas. It was the first products line that has developed by SHISEIDO for the BOP market. As JITA has already presence in the last mile and have an established distribution in hard to reach areas, it was beneficial for SHISEIDO to use that network rather than built their own. Through this partnership, SHISEIDO is not only expand its product distribution to last mile, but also with the help of brand value that JITA has, it has created a lasting impact in consumers mind. And on the other hand, JITA has also introduced a new quality skin care product line in its distribution network which has increased the value of its product baskets and Aparajitas (Sales Ladies of JITA) were also able to generate a moderate income from this.
In Jeeon, recently we have launched an e-learning platform for Informal Healthcare Providers like village doctor, chemist, community paramedics, Community Health Workers and others. This app can play a catalytic role in this integration. It can be used to upskill village doctors at scale through interactive educational and knowledge content and long term testing of learning and retention. It can also be used to connect village doctors and their patients to qualified physicians, through telemedicine, for diagnosis and treatment of a wide range of medical issues that are common in rural Bangladesh. Finally, it can play a transformative role in tracking and managing the referral network, minimizing patient exploitation and inconvenience, and formalizing the chain of escalation. Finally, it can play a transformative role in tracking and managing the referral network, minimizing patient exploitation and inconvenience, and formalizing the chain of escalation.
One of the challenges we have faced during launching the product was identifying the right segments of our products. Initially we have tried this with our own workforce and it was good. However the cost of identifying a right users was very high, around BDT 300 and cost of engaged users was around BDT 900/-, which means in every 3 users, 1 was converted to engaged users. And if we go like this then to reach 1000 engaged users, we have to expend around BDT 100K which was not operationally viable. Along with the digital marketing we have also developed some partnership. Initially we have a partnership with ASTHA, a project of Swiss Contact.
ASTHA (January 2015 – December 2018) has been designed to facilitate the development and integration of Community Paramedic services in rural Bangladesh, particularly in Nilphamari, Patuakhali and Sunamganj districts. Its focus is to improve access to healthcare service in rural areas, with special attention to Maternal and Child Health, Family Planning and basic primary healthcare services. Under this projects they have around 800+ CP who got the CP training and now working as a healthcare providers in different institution or their native village. Jeeon has developed the partnership with ASTHA to disseminate its app to these CP so that they can also increase their skills and knowledge and can involved in the platform to provide other types of services. It will not only enhance their knowledge base but also will create new income sources by providing different types services in his/her community. There is around 100 CPs who are engaged with the app on weekly basis and the cost of per engaged users is only around BDT 54/-. We have reached them through digitally. Eventually we are going to approach all the 800+ CPs by end of this quarter.
Jeeon signed a MoU with DMF Platform, a platform of DMF medical professionals of Bangladesh. The objective of the MoU is to ensure the free access to all DMF medical professionals in Projotno E-Learning App where they can improve their medical knowledge by reading different contents and also solving different types of medical cases.
Clarify Your Goals: Before your partner can help you grow, they need to know what type of growth you’d like to see. Without clarifying your goals, you make it difficult for your partner to help you. Make it clear what you’re trying to accomplish. This will guide your partner to know how and when to talk about your business. Clarify your goals and show your partner how they fit in. The better you can do this, the better help they’ll be to your overall growth.
Make Your Partner’s Job Easy: Your partner has their own business to grow. They cannot focus on growing yours in addition to their own. Although they’re happy to help and look forward to positioning their company with yours, you must make it as easy as possible for them to help you. Give your partner marketing materials they can use to promote your products. Offer demos to their customers to make it easier to close the sale. No matter what you do, make the job of your partner as easy and straightforward as possible. Doing this will ensure you get the maximum exposure.
Make it Worthwhile: In the end, every partnership should benefit both parties. Focus on how your business will help your partner’s growth too. The more you can show your business partner that you’re watching out for their success, the stronger your relationship will be.
From my last 5 years of experience in business development, the team should on strategic partnership like a plant seeds, that requires some time and intensive care in initial period so that it can give you fruits for years to come. And treat your partners with the mutual respect (whether it’s a big corporation or a small business) and that you would bring to any healthy relationship to boost your lead generation efforts and your bottom line.
Currently in Jeeon, we are looking forward for new partnership opportunities which will help us to grow our users base and create access to different types of referral services in the last mile. On the other hand, through these partnerships, our partner can also develop a distribution of their services in the last mile and also can create a sustainable learning methods for its beneficiaries/users/employees.
From August 2013 to September 2015, I worked as Head of Business Development at Jita Social Business Limited (a joint venture of CARE International and Dannone Communities). During that period, I had lead to lead lots of varieties projects, like from rural market activation to health entrepreneurs development to establish micro franchisee development in Ethiopia. Due to work in diversified projects, I have gathered lots of learning and stories during that time. Today I would like to one of those stories with you.
One of the major projects of mine in JITA was CARE-GSK CHW Initiative project. The main objective of the project was to improve health outcomes of women and children below two years of age in under served and poor communities. The project was funded by GlaxoSmithKline. To make this initiative more sustainable, CARE has signed a partnership agreement with JITA with an objective to develop sustainable and economically viable business for 56 P-CSBAs (Private Community Skilled Birth Attendant) through introducing new and innovative sources of revenues, contextualization of services offered and individualized business development support. Initially we had provided a 3 days long entrepreneurship development training to all 168 P-CSBA, but in this term, we worked with only 56 P-CSBAs.
P-CSBA Rehana was one of the 56 P-CSBA with whom JITA will work. Rehana Begum lives in Dowarabazaar Upzila, she was 32 year old. She got training from CARE on how to provide MNCH services and started working as a P-CSBA from November, 2013. She is a widow and mother of 2 children. Her target customer is women in reproductive age (15 to 49 years old). In her working area, the around 1700 women were in that age limit. From the initial market assessment conduced by JITA, we found that it was quite possible to earn BDT 8000 to BDT 10000 for her. However, her income per month was only around BDT 1300/- per month. As a part of internal and external assessment of PCSBA, JITA dig down the reasons to identify why her income is not up to the minimum mark (BDT 5000). Even when we have asked her for the first time why her income is such low, she didn’t share any concrete reason with us. She just told her that its not possible for her to make more money than this. We found her really demotivated and depressed.
May be on that time, it was pretty easy for me to say that she doesn’t has the materials to become an entrepreneur. But as a development practitioner, I know there are some hidden reasons. It was true to almost all 56 P-CSBAs. To find out those reasons, I designed an external and internal assessment tools to assess their personal motivation to supporting environment along with external environment assessment.
After the assessment, we have found the following reasons –
As she has 2 child of age, one is 3 years old and another was 6 years old that time, so it was not possible for her to go out of her house for more than 2 hours. Her Brother-in-Law and his family lived to the next house but they didn’t supported her in this regards. That’s why she spend only 2 hours in this work.
There are around 12 villages in her working area. However, she is a widow, so she feels insecure to visit new areas. She can cover upto 4-5 villages which were nearby to her house, but to cover the other villages, she need to cross the market and she was not comfortable to cross the market. That’s why she always visit those 4-5 villages, only 30% of her market.
As she was not roaming around her target areas and talk to people of community about the safe motherhood, so her community people are not well aware about her presence in the community and also what services she provides. She also felt shy as she didn’t do anything like this in her whole life.
After finding the above reasons, me and one of my team member Mr. Salahuddin sit together and developed an action plan for Rehana. We both have agreed that before taking any business intervention, we had to take some social mobilization interventions first to break the barriers. So we had taken the following actions to break the social barriers –
Talked to her extended family members and motivate them to support her. We have engaged her family members in a way that they will provide the support willingly. Mainly the support she needs to arrange lunch for her children when she will be in service. It helped her to give 4-5 hours in her job daily instead of 2 hours only.
Discussed the insecurity issue with her family members and also local elite persons and they ensured us that they will provide necessary support and protection to her. Moreover, Mr. Salahuddin went door to door with her for 1 week to ensure that she feel secure to move in her working areas.
We arranged small yard meeting in her working areas to ensure that community members know her and the services she is providing. These yard meetings create an access to community for Rehana and also create a credibility of the her as P-CSBA. During these sessions, the local elite persons were also participated.
With the help of local elite and local CARE staffs, we have developed community volunteer in her working areas who had informed Rehana if any women get pregnant or any households face any MNCH problems or anyone need delivery support. The volunteers were also worked as a spoke person for Rehana in the community.
We also helped her to plan what sorts of health, hygiene and nutritional products she can sell apart from providing the services. We developed a root plan for her, so that her customers know when she will come in that area.
We had linked her with the local pharmaceuticals wholesaler so that she can buy OTC drugs, health and hygiene products in a discounted prices and sell those products in her community.
As I mentioned, before taking this initiatives, Rehana’s average income was around BDT 1,300/-. After implementing the above mentioned actions, her brother-in-law and his family gave her full support she needs, and the local elite also gave their full support so that she can move around the community without any hesitation. And if possible, they also attended her yard meeting to introduce her to the community.
Due to the social mobilization activities, the community people now know her and as a result now she is more confident to move alone in her working areas. After intensive support of 2 weeks, she has earned around BDT 3,300/- and at the end of the month, she earned around BDT 8000/-. In next 2 months she earned around BDT 9500/- and BDT 11000/- consecutively. She had more confident that she can earn around BDT 15000/- per month if she also started selling some health and hygiene goods in that area. So she started accumulate some capital to invest in her product selling interventions and within 3-4 months, she started selling health and hygiene products like oral saline, women hygiene products in that community and earned around BDT 15000/- as she targeted.
I still remember what Mr. Salahuddin said when I talked with him about Rehana for the first time. He told me that Rehana can’t do it, as she had lacked of motivation and interest and she was happy with her current income. After 1 month of intervention, I asked Mr. Salahuddin whats his feeling right now and he told me, “Bhai the whole situation was like an iceberg. It was pretty easy to say that its not possible for Rehana. But exploring the whole problems, I understood that if I was in her position, I might not earned that BDT 1300/- even”.
From this project, one of my key learning is that providing capacity building and financial support is not enough to develop an entrepreneur (whether a micro entrepreneur or a million dollar entrepreneur). To guide him/her to develop the plan, to coach him/her to solve the problems an entrepreneur faced and mentoring him/her to develop specific skills and knowledge is ultimately help an entrepreneur to develop his/her business and shoot for his/her vision to achieve.