What the Daraz rebrand means

By Abdullah Niazi

Why do companies rebrand? Sometimes, it is a matter as simple as updating an outdated image or wanting a new logo to get some much-needed marketing momentum. On other occasions, it is a much more complicated affair. International growth, new management, a PR nightmare, or a bad reputation could all prompt a corporate rebranding.

This rebranding can be proactive or reactive, which means a company can either choose to undergo one to actively try and change course or they could have been forced to do so by public pressure or bad press over some incident. Whatever the case might be, a company going through a rebranding is trying to say one thing - something is about to change. A new logo can indicate a change in values and ethos or a change in direction and outlook.

Daraz, the multinational e-commerce and logistics technology company based in Pakistan, Nepal, Bangladesh, and Sri Lanka, has recently gone through a rebranding that has resulted in a lot of chatter within marketing and advertising circles. With a shiny new logo designed by a London-based creative brand agency, Daraz is pushing their rebranding efforts by supplementing it with a new website and a large marketing campaign. The only question is, will the changes that come with the rebranding make any difference?

Why rebrand?

Whether the rebranding is proactive or reactive makes all the difference in the world. Most companies have to rebrand in response to something. Take, for example, Subway. The American multinational fast-food chain released a new logo after the 2016 Olympics to try and draw attention away from sexual misconduct allegations against their former spokesperson Jared Fogle. This is the kind of situation where a company undergoes a rebranding to symbolise change in the wake of bad press.

A more locally relevant example of this would be the pivot made by skin-care cream Fair and Lovely, which in September 2020 announced that they would be changing their product’s name to ‘Glow and Lovely’ and removing all references to “skin lightening” and “skin whitening” on their product. Fair and Lovely had been under criticism for promoting colourism for years, but were forced to make the change due to public pressure. On the other hand, a company could also go through a rebranding like Airlift did in Pakistan when they made their pivot from mass transit startup to grocery delivery.

Daraz is lucky in the sense that the rebranding they are undergoing is a proactive one, which means it is completely on their own terms. In fact, there seems to be very little in terms of reasoning behind why Daraz chose now to rebrand. Profit reached out to Bjarke Mikkelsen, the CEO of Daraz, whose team said in response to our question that the rebranding came because Daraz has changed over the past seven years. “Daraz has come a long way and grown so much over the past seven years. We have transformed multiple times from being a small online fashion retailer to becoming a household name and the leading South Asian marketplace,” read the response.

In the past seven years, perhaps the most significant change at Daraz has been its acquisition by the Chinese e-commerce giant Alibaba. In 2018, Alibaba acquired the Daraz Group for an estimated $150 to $200 million a couple of months after it announced a multibillion rupees investment in acquisition of 45 percent stake in a local financial service industry. Back then, there had been murmurs about a rebranding which had been quashed quickly after it was announced that the brand would continue to operate as Daraz.

However, the changes that came after the acquisition have been slow to become apparent, and while the rebranding has not officially been tagged as a result of the acquisition, it is coming after some serious changes in how Daraz operates. “Just in the past 12 months we have significantly upgraded our user experience and our NPS has reached an all-time high. As we look forward to the next chapter of our journey with a further enhanced shopping experience, we believe it is the right time to evolve our brand to showcase how we are shifting gears as a business,” the Daraz team said in their response.

“The brand refresh is a natural step of establishing greater connectivity with both our customers and sellers, and creating a more personal experience. We also hope that the refreshed brand will allow us to engage more women in the marketplace – both as customers and sellers.”

What is changing?

The rebrand itself has garnered quite some mixed reactions. The biggest change as of now has been the daraz logo, which used to be simply the word ‘daraz’ in all lowercase letters written in the company’s corporate colours. Now, it has changed to a single symbol instead of a word.

“We wanted to have an icon that is unique and representative of everything that Daraz is about. Many ecommerce companies have a shopping bag as their icon, but ecommerce orders are not delivered in a shopping bag – they are delivered in a package,” Daraz CEO Bjarke Mikkelsen’s team said in their response.

The goals that Daraz has set for themselves for the year in addition to this are ambitious, and the year will be an important one both in terms of the rebranding rollout and changes to operations. Their aim is to reach 100 million customers and businesses by 2030, while also continuing our purpose to uplift communities through the power of commerce. “We will be investing heavily in our infrastructure to accelerate deliveries, providing a frictionless experience to both our customers and sellers, scaling our brand portfolio and assortment, driving price competitiveness, and investing in content, search, and navigation to create a platform that is personal and intuitive to use,” said the Daraz team.

The sentiment was echoed by Bejerke’s team in Pakistan, which in their response to Profit wrote that the rebranding is part of a natural evolution, and is not even unprecedented in Pakistan. “As we mature our service offering and shift gears as a business. Many (if not most) brands have undergone refreshes over the years – in Pakistan this includes brands such as Foodpanda, Careem and OLX.”

Daraz has tried to explain the ethos behind their rebranding in some detail. It is also clear that it has come not just after the Alibaba acquisition in 2018. But once again, as mentioned earlier, the question is what are the changes that are upcoming as a result or along with the rebranding.

“We know there has been a mixed response, but for us the customer experience is the most important part. Rebranding is never easy, and it takes its due course,” said Ammar, Daraz’s head of marketing. “A lot of my role involves talking to different external stakeholders, and the response to the new brand look has been overwhelmingly positive. I have received great feedback from industry leaders, including our parent company Alibaba. Most importantly, I have received many appreciation messages from customers, partners and people in the creative industry - that is personally the most meaningful to me.”

A more locally relevant example of this would be the pivot made by skin-care cream Fair and Lovely, which in September 2020 announced that they would be changing their product’s name to ‘Glow and Lovely’ and removing all references to “skin lightening” and “skin whitening” on their product. Fair and Lovely had been under criticism for promoting colourism for years, but were forced to make the change due to public pressure

Who did the rebranding and what did it cost?

The rebranding was done by DesignStudio, a London- based creative brand agency, but we specifically worked with their APAC team based region in Sydney, Australia. The agency has produced great work for global brands like Airbnb, AliPay, Deliveroo, Champions League, Grab, Swiggy, and Evernote, and we were confident of having them lead the rebranding process for us.

The rebranding was a 360-degree brand refresh on the brand strategy, vision, mission, architecture, tone of voice, typeface, graphic systems, and avatars. “Overall, we are very happy with the output. Excitingly, we also launched our new corporate website, www. daraz.com, which brings all of the new elements together,” said the Daraz team.

While they did not offer any details on how much the rebranding cost or what their expected revenue targets for the rebranding might be, Daraz CEO Bejarke Mikkelsen told Profit that it was not an extravagant rebranding. “The price isn’t something we can talk about. I dont know of any company that has ever published expected revenue numbers from brand refresh - that’s not something you can quantify. We can say that this was within a normal budget compared to other companies that have done a brand refresh and we are confident that streamlining our brand will be a good investment in the long term.”

Overall, the rebranding has gotten one thing right for sure - people are talking about and noticing the rebranding. That is the most essential ingredient in measuring the outcome of something like this. Whether they will be able to reach their ambitious goals is yet to be seen. n