The first half of 2023 has brought a drastic change in Iraq with the currency readjustment and the roll-out of new regulations for the finance sector, in particularly for online transactions, as well as new regulations for the local logistics sector.
Today, In Iraq, around 80-90% of online sales in Iraq are made by social sellers. This hasn’t stopped the market from organising itself during last 5 years to adapt to global trends and adopt tech-enabled solutions like Sandoog.
And since Sandoog is one of the change agents driving this progress for online sellers, In our case, clients who qualify for our services do so by responding to a simple, key message from us - Give us your products and we’ll do the rest.
However, we’re also seeing more and more modern aggregators, social-commerce startups, as well as Branded eCommerce platforms engaging with us to integrate with our 3PL service, and offering a more structured experience for consumers in Iraq. These merchants require from us local warehousing, fulfilment service, express delivery, cash-on-delivery (COD) handling, API integration, a local call centre and much more. These requirements are vastly different to that of the average online store - selling directly through social media pages without landing pages, websites or apps.
Is there a cultural shift happening now in Iraq's online shopping sector?
The short answer is; yes.
The caveat is, the traditional eCommerce platforms/apps culture is being adopted slowly - But it is seemingly growing.
So what does this mean?
Unlike more mature eCommerce sectors in the MENA region who are dominated by large multinational platforms and apps i.e. Amazon, Noon etc., and where social-selling is specifically filling in the gaps where these apps don’t target - eCommerce platforms in Iraq, on the other hand, are fighting to gain market share from the vast amount of social-sellers/resellers dominating the online shopping market.
More recently, In the MENA region, social-commerce startups are becoming an evolution of sort, organising the social selling market alongside the mature eCommerce market. - In Iraq, However, these social-commerce platforms, including aggregators and CPA marketing platforms, are entering the online shopping market and out-competing branded eCommerce apps and platforms. And they are doing this by capitalising on the large supply of social-selling culture dominating the online shopping market.
Case in point: For 3PL services like Sandoog, this evolution makes our work more streamlined - Social-commerce platforms house social-sellers and integrate with us and act as a representative or a mediatory of sort. They collect order requests from sellers - they systematically push the order requests to us - we fulfil the orders. This ultimately means we deal with one entity representing potentially thousands of small to medium sized sellers.
What factors have been driving this reality?
There are a number of infrastractural factors- Primarily, the fact that Iraq relies on Cash-On-Delivery for over 90% of online sales. And that’s a conservative estimate. Which ultimately means a lower order success rate overall compared to upfront card payments, of course.
As first movers in the tech-enabled 3PL space, Sandoog is attempting to catalyse the evolution of the online shopping experience. By providing the necessary operational services to the new generation of social-commerce and eCommerce service providers. Our message is still the same, as I mentioned in the beginning; Give us your products and we’ll do the rest. Focus on what you do best - Grow your brand, your customer base, and your sales funnels.
Do you have any questions or are you thinking of entering the Iraqi market? Send me an email: mustafa@sandoog.net
