The e-commerce landscape in Iran has undergone a noticeable 17% decline in online transactions over the past Iranian year, which concluded on March 20. The revelation comes from the Ministry of Industry’s annual report, prepared by the Center for E-commerce Development. The number of transactions has plummeted from approximately 3.6 billion to 3 billion since March 2022, prompting concerns and speculations.
The report points towards a potential connection between this decline and the frequent internet disruptions that have plagued Iran since September. These prolonged outages have impacted various online activities, including e-commerce transactions, creating a challenging environment for businesses operating in the digital space.
In June, the Tehran E-commerce Association expressed its alarm about the deteriorating quality of internet services in Iran. The association highlighted the severe hindrance caused by what it described as “widespread and persistent disruptions affecting all IPs and websites.” This alert underscored the urgency of addressing the internet’s reliability, as it remains a crucial infrastructure for conducting digital transactions and facilitating e-commerce growth.
Another aspect examined in the report is the preferences of e-commerce entities towards social networks and messaging apps. Despite being banned since September, Instagram emerged as the dominant platform, capturing a significant 55% usage share among these entities. This statistic indicates the lasting influence of Instagram in the digital landscape despite its inaccessibility.
Telegram, which has faced filtering in Iran since 2019, secured the second position in terms of usage, with 41% of e-commerce entities utilizing the platform. WhatsApp, also subjected to a ban since 2022, accounted for a noteworthy 37% usage share. This reveals the ongoing reliance on messaging apps for communication and engagement within the e-commerce sector, despite the limitations imposed by the bans.
Interestingly, the decline in e-commerce transactions coincides with protests that emerged in Iran last year and are anticipated to resurface on the anniversary of Mahsa Amini’s death. Amini’s death in detention of the morality police serves as a poignant reminder of the broader social issues that contribute to the complex dynamics shaping the Iranian society.
Amidst the backdrop of these nationwide protests and ongoing internet disruptions, a notable revelation emerged from the report. An estimated “80% of users within the country” have reported resorting to VPN or proxy services to access social networks. This statistic highlights the determination of Iranian users to circumvent obstacles and connect with the digital world despite challenges, showcasing the resilience of the nation’s online community.
In conclusion, the decline in e-commerce transactions revealed in Iran’s Ministry of Industry’s annual report raises significant concerns about the impact of internet disruptions on the digital economy. The interplay between technological challenges, societal dynamics, and the adaptability of Iranian users forms a complex tapestry that is shaping the course of e-commerce in the country. As Iran navigates its digital future, addressing internet reliability and fostering a conducive environment for online transactions remains crucial.
