Two e-commerce marketplaces, Kaymu and Daraz, have been merged into a single entity across Asia by Rocket Internet; a German powerhouse startup announced it on Friday. Both the companies will be bearing same brand names. However, their operations will integrate under new entity, Daraz Group.
Kaymu is an online marketplace which provided consumer-to-consumer (C2C) and business-to-consumer (B2C) platform in various countries including Pakistan. It is one of the best online marketplaces and this portal connects buyers with sellers to close deals on various new and used products. Kaymu primarily targets smaller businesses. Kaymu has its presence in 7 different countries; Bangladesh, Cambodia, Myanmar, Nepal, Pakistani, Philippines and Sri Lanka.
Daraz, on the other hand, is a marketplace that brings together leading sellers for various product types together at one place so that all the retail needs of the consumers can be conveniently and competitively fulfilled under one umbrella. Daraz is comparatively a premium place for more established brands and companies. Daraz is currently operational in three countries; Bangladesh, Myanmar and Pakistan.
Co-CEO of Daraz Group, Bjarke Mikkelsen, while speaking on the occasion stated that:
“Daraz and Kaymu have agreed to join forces. Both platforms will remain active with their current brand names, but the new entity, Daraz Group, will integrate the operations under one roof”
Both e-commerce sites have built successful operations in their respective markets. It is pertinent to declare that both Kaymu and Daraz will continue to operate with the same brand names in Bangladesh and Pakistan. The two e-commerce sites will be separate in these two countries. However, in all other countries, they will be merged under a single brand name.
German juggernaut, Rocket Internet says that they had been contemplating this move for 6 months. This move will help ‘leverage synergies on the growth and cost side.’ The decision was also made to locate their central operations to Pakistan from Paris.
As a result, the operations will be merged and managed by one centralized team in Karachi. Operations like marketing, IT, and business intelligence for the group will be centralized in Pakistan’s biggest and largest revenue generating city. The decision to centralize operations in Pakistan away from Paris means the group will also have considerably less overheads and be able to operate on a lean model.
Bjarke Mikkelsen further added:
“Kaymu is the larger company in terms of customer base and orders but Daraz is significantly bigger when it comes to gross merchandise value, or the total amount of cash consumers spend. The overlap between customers who transact on both Daraz and Kaymu is less than 10 percent of their combined user base”
The opportunity to cater to both sets of consumers and up sell products is a key factor in Rocket Internet’s decision.