The direct selling channel in Pakistan primarily targets women; hence, the focus of retailers in the channel remains on beauty and personal care and household products. Direct selling in Pakistan is a retail channel which is well-suited for women who have limited access to brands via any other means, either due to mobility issues or lack of awareness of mass brands.
The direct selling channel in the country remained largely unregulated until recent years, when the Direct Selling Association became active in policy design and implementation to ensure the legitimacy of retailers and safeguard consumer interests. However, Ponzi schemes and fraudulent incidents have been prevalent, curbing investor confidence and consumer trust over the years.
Leading direct selling companies in Pakistan have products mainly within health and beauty and personal care, which are primarily targeted towards women. Hence, brands such as Oriflame are increasingly investing in efforts to maximise their reach by employing brand ambassadors in female-centric places such as beauty salons.
Direct selling remains a lucrative channel, especially in rural and semi-urban areas in the country, where the mobility of women is limited, and brands are less accessible. However, with growing internet and smartphone penetration, access to a wide product variety has grown tremendously.
To counter the growing competition, direct sellers are increasingly inclined to reduce their margins to attract consumers. However, this has led to ununiform pricing of products and the narrowing incomes of sales ambassadors in the channel.
The direct selling channel in Pakistan is still in its infancy, with a very small contribution to the overall retail landscape in Pakistan. With only a few retailers present in the channel, there is an untapped market for new players.
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This industry report originates from Passport, our Retailing market research database.