Key Lessons From Successful Iranian Startup, Digikala with $12M monthly revenue.

Key Lessons From Successful Iranian Startup, Digikala with $12M monthly income.

My tweet about the amount of sales and income of Digikala, the most trusted Iranian online digital shop, went viral and attracts much attention.

Mr. Saeid Mohammadi, Digikala’s co-founder in a conference in February 2014 reported that they currently get more than 2000 orders with average of 6.000.000 Rials. With a simple calculation we get to the number of 12.000.000.000 Rials (~ 400.000 $) revenue in a day. This amount of sales and income is very noticeable in Iran, a developing country which faces many obstacles in its IT infrastructures as well as its economy.

Digikala was a startup founded in 2007 with a team of 5. Now it has more than 200 employees. In the first month of operation, this website started to sell computer peripherals and a small collection of printers. The rise in the number of internet users and also development of online payment systems in Iran eventually increased the level of trust to internet banking and online purchase which ultimately result in a better environment for doing online businesses.

Success Secrets of Digikala:

Two of the most important elements of success of Digikala are Comparison and User Review features of the website. In my opinion as a user and also as a professional in this field with years of experience there two features were some of the most important competitive advantages of Digikala.

There features are not new and they were not discovered by Digikala but their excellent implementation positioned Digikala as a source of user-based conversation and word of mouth marketing for digital goods especially the smart phones.
Solving the trust issue:

One of the important elements of success of Digikala is its ability to become a medium to provide specific and transparent information and price for its items. In this world of advertisements noise and dishonesty in the market, making decision and choosing something (e.g. a mobile phone) to buy is very stressful. And with the increase of options and different models and brands it is getting more complicated day by day. so people are eager for transparency and honesty.

No Big Competitors:

Amazon.com is 2012 sold 300 items per seconds and its income in 2013 is close to 75$ billion. So in a way the financial sanctions on Iran which prevent the international companies to have financial relations with Iran became golden opportunities for local businesses in Iran. While entering giant business to new markets always have bad impact on local businesses, with such sanctions there is no Amazon.com or ebay.com in Iran.

Market Disruption:

Digikala was able to disrupt the market of old brick and mortal digital shops. It is obvious that its operational costs are much lower than physical stores and it has country-wide access.
Other online markets in Iran:

The number of online shops in is increasing. Some of them had more exposure and are more famous such as chare.ir, Final.ir, varchin.com, zanbil.ir, tehrankala.com, etc. None of these famous online markets have the privilege of Digikala in minds of Iranian users.

Digikala in comparison to these e-shops has 3 important advantages:

  1. Focusing on niche market of digital products.
  2. Providing its own warranty.
  3. Better UI/UX.

 

Future of Digikala:

Digikala is in the path of growth and they want to recruit more than 500 personnel untill the end of 2014.

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Author: Sohail Abbasi
Hi, thanks for reading this. I am Sohail, an author, software engineer and startup mentor, who researches, practices and writes about Starting new ventures from innovative ideas. I am contributing to the entrepreneurial ecosystem and startup communities in Iran and Kurdistan.



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