In the past decade, e-commerce has experienced significant growth in Iran. However, while we have been ahead of neighboring countries, we are now lagging behind them. The share of online retail in Iran's total retail market is only 4%, compared to Turkey's 20%.

Limited investment and the obstacles ahead, inadequate support for the digital economy in legislation and regulation, the imposition of restrictions that target the most fundamental needs of online businesses, international sanctions that hinder the development of digital businesses in the regional market, the absence of major international brands in Iran, and a non-transparent market created due to restrictions on the import of certain product categories are among the main reasons for this lag.

In this chapter, we will examine the state of e-commerce in Iran. We will first discuss the situation of online retail in Iran and some other countries, using data from various sources.

The rest of the sections present the results of a national survey titled "Attitudes and Perceptions of People Towards Digikala," conducted by ISPA in (month of) Bahman 1401(Feb 2023) . In this research, which we delve into in the Digikala chapter for a more comprehensive analysis, questions were posed regarding people's online purchasing behavior, providing valuable insights into the state of e-commerce in Iran.

Online retail has made its way into Iranian e-commerce market in recent years, but there is still a long way to go. Despite the progress, Iran's share in the online retail market remains very small. Only 4% of total purchases and sales are conducted online.

Out of the total retail market in Iran, online stores and social media-based retail account for 2% each. Among online stores, Digikala holds a 1% share of the online purchases and sales.

When we asked people who shop online about the advantages of online shopping or why they choose to shop online, the majority of respondents highlighted four main benefits. These benefits were the convenience of online shopping, time-saving aspect, lower prices and cost-effectiveness, and the wide variety of products available online(SKUs).

When we asked online shoppers about who in their family typically makes online purchases, 36.5% of respondents said it's their children. This is three times the number of those who mentioned either the father or the mother as the ones making online purchases in the family.

We asked individuals about online shopping, and 68.3% of respondents said they engage in online shopping, while only 31.7% stated that they do not shop online at all.

However, only 21% of those who shop online said that they prefer online shopping if they have the option to purchase an item either by visiting a physical store or through online shopping.

Other answers:

We asked individuals who do not engage in online shopping (31.7% of the Iranian population), "Why don't you shop online?" Among them, 49% stated that they need to physically see the product they are buying, 39% mentioned a lack of trust in online stores, and 35.5% said that they don’t know how to do online shopping.

Those who expressed a lack of trust in online stores make up approximately 20% of the total sample and represent about one-fifth of the Iranian population.

People's inclination towards online shopping varies depending on the type of products. According to the results of a national survey by Digikala, the top category of products that respondents expressed their willingness to purchase from online stores is clothing. Health and beauty products, books and stationery, home and kitchen appliances, mobile phones and electronics, sports and travel equipment, supermarket items, toys and children's products, tools and industrial equipment, and local and traditional products follow in the subsequent rankings.

Women show a higher willingness for online shopping in categories such as supermarket items, clothing, books and stationery, toys and children's products, health and beauty products, and home and kitchen appliances.

But men are more inclined to purchase mobile phones and electronics, tools and industrial equipment, and sports and travel equipment through online channels.

Among the respondents who engage in online shopping, 61.2% of them have identified online stores as their first choice for online purchases. Other answers.