The (Potential) Role of E-Commerce Data In Nepal’s Development

Author: Shuvam Rizal
The (Potential) Role of E-Commerce Data In Nepal’s Development
Image Credit: Meghraj Neupane, Unspash; @megh1995

It has been stated to the point of almost sounding cliché — but it remains true nonetheless. The key to a smooth transition into the digital and quasi-digital markets that does, and will more so in the near future, occupy most of the world’s trade volumes is big data. As is the rest of the developing world, Nepal is currently at a crucial stage in its history as a country — and the time to capitalize on strong data infrastructure is now. From private enterprise engagement to long-standing issues of the development process, high volume-consumer data hold information that datasets used by research and multi-lateral organizations simply lack in nature and insight. How we use this information, or if we even use it at all, is being determined by a handful of companies now.

Upon the announcement of the first lockdown in early 2020, some countries in the world were naturally better positioned to take advantage of its digital marketplace than others. While we did have e-commerce outlets, many of which were confined to exchanges in social media private message threads, the boost in overall online retail demand is unprecedented. What is most interesting in the Kathmandu context, however, is that a sizable portion of the adult population were learning how to use social media as they adapted themselves to the digital marketplace. Unfortunately, because outlets are privately owned, we haven’t been able to see actual sales trends as we have in publicly traded companies across the world. Still, if anecdotal evidence is anything to go by — people are shopping online more today than ever before. And if global trends are anything to go by — this is only the beginning.

At a global scale, the online-shopping demand spike is unprecedented. Karen Weise, for the New York Times, reported recently that the world’s largest e-commerce platform, Amazon, has been on a hiring spree estimated at ~1,400 workers a day. As online shopping becomes more entrenched in the average city-dweller’s life in the COVID-19 era, the company’s stock has soared, its CEO now positioned as the richest and, by many accounts, one of the most powerful men in the world. A hiring spree of this sort has only been previously recorded during wartime scenarios; Weise reflects.

Naturally, the Nepali context is radically different. The e-commerce sector is scattered, there is little sales accountability on both the customers and the providers side (not to mention the many middle-entities that exist, particularly delivery companies), and there has been hotly contested pushback from the government in the last few years to even institute a marketplace that empowers entrepreneurs — thus sparking an ongoing infrastructure argument between stakeholders involved. Still, the data angle is worth exploring. Every time a customer adds an item to the Cart and then decides otherwise, or checks the price on their favorite online-shopping app just to compare with in-store prices, new datapoints are generated. Companies like Daraz, SastoDeal, Muncha, and the like now have previously non-existent insights into the minds of the Kathmandu consumer — from click rates and engagement tendencies, to items/bulks most popular at different times of the month, or day.

For many years, Nepal’s data world revolved around survey results conducted by national and international entities for research or multi-lateral donor-backed project purposes. It is worth noting that government ministry and organization websites, particularly post 2015 Federal-constitution, have been sharing statistics in a much more easily accessible way. However, the mind of city-dwelling individual consumers and how they engage with the market has been rather mysterious, and in fact, many business-owners to this day tend to rely on word-of-mouth popularity, anecdotal evidence to determine if a product is appropriately presented and/or priced. This need not be the case anymore. The global datasphere is projected to reach 175 zettabytes by 2050, as forecasted by the IDC. A small sliver of this sphere includes data collected in Nepal, quickly migrating the cloud and left for eternity with the rest of the world’s data-dump.

Any insight into the mind of the customer-base in a country as understudied as ours is valuable — but datasets exploring Kathmandu-based household’s shopping habits at a time when in-store transactions were literally impossible is a unique opportunity to understand our population. If we are to position ourselves to benefit from such an opportunity in a development note, this information needs to be shared. Unfortunately, the problem is multi-prong since infrastructure itself is lacking. E-Commerce business owners express that the government can make their lives much easier by simply removing blockades meant to regulate but left unenforced in the digital space. It is thus imperative that the digital marketplace is supported (and of course, effectively regulated — the key word being effectively here) as much as possible. With growing data literacy in Kathmandu, and indeed, in the global workplace — more accessible remotely now than ever — data scientists and experts can then be engaged to make sense of the complex information and the scientific/social-scientific community will be the first to jump on using the newly uncovered insights to better understand Nepal’s development process.

The views and opinions expressed in the piece above are solely those of the original author(s) and contributor(s). They do not necessarily represent the views of Governance Monitoring Centre Nepal and/or Centre for Social Change.