Awale Mag

Magazine for Africa's Creativity

Auteur/Author: Aissatou GAYE

The boom of e-commerce in Africa

Their name is JUMIA in Nigeria and 25 other African countries, DIAYMA in Senegal, KALAHARI in South Africa, MADEINMOROCCO in ….Morocco,  of course. These are e-commerce websites as it pops every month, participating in an unprecedented digital dynamics in Africa.

If creating its e-commerce site can be relatively simple, to keep it alive, create a true community behind it and turn it into a profitable business remains the challenge that these companies daily face.

The e-commerce in Africa

Stricto sensus, e-commerce is a form of commerce where all products are sold on a dedicated website. The business model is classic: the site works as an online showcase which displays the products for sale in the most attractive way possible. The choice of the buyer, payment, everything happens online. And delivery of the product is held at a distance. Popularized by major sites like the American EBay, Amazon, the French La Redoute, this form of online selling  entered into the manners and consumption habits of Western societies.

In Africa, E-commerce is just beginning. Some online shopping sites have long existed such as BID OR BUY in South Africa, created in 1999.

But the real tremor began in 2012 with the creation of Africa Internet Group, a subsidiary of German incubator Rocket Internet. JUMIA was its first product, launched in 2013 in Nigeria. Subsequently, JUMIA Egypt, Morocco, South Africa were created. The site is now declined in 25 African countries, employing a workforce of 3,500 employees.

The concept is a fairly simple logic. There is the emergence in Africa of a new middle class,  young (20-35 + years), eager for consumption. They work, are from the Smartphone and Tablet generation. They need a computer, shirts, bags, tech and fashion items and have no time to lose … JUMIA offers them all this in a single click.

Thereafter come KAYMU, JOVAGO, HELLOFOOD … from the same group, to identify all consumption needs of this new socio-economic class. Supported by an unprecedented effort of Marketing and Communication, AIG built a place of leader in this new market.

Other general e-commerce sites also grow and strengthen up. Note that this growth would not have been possible without the effort of African governments and telephone companies to democratize access and use of the Internet. Moreover, as the mobile phone has overtaken fixed lines in Africa in less than 10 years, many Africans have Internet access via their mobile. A third of the 1.2 billion Africans should have access to the net by 2017.

However, all these e-commerce sites face challenges and they outline solutions that have deflect the e-commerce standard system into an “ e-commerce, African way”.

The triptych: TRUST, DELIVERY, PAYMENT

First comes the issue of credibility, trust. Internet crystallizes all of our suspicions regarding fraud, cyber crime, and it is difficult for a new ecommerce website to gain the trust of potential clients, particularly in Africa. Payment on delivery is an attempt to circumvent this problem; the “I pay what I see ‘helps to give a relative sense of security to the African online buyer. Moreover, advertising, communicating and investing the  audiovisual space helps to give credit to a sales site.

There is also the issue of delivery, particularly in remote areas or areas difficult to access. Post systems, despite efforts to understand and integrate the challenges of e-commerce and distribution in general, do not win the favor due to negative prejudices. And entrust the service to an external service provider is expensive. The solution is therefore to integrate oneself thee delivery service by purchasing motorcycles, minivans, etc. to meet these requirements. But this comes with  an economic cost.

Finally, comes the question of payment. The electronic means of payment have gradually taken place in the African portfolio. However credit cards remain elitist, in a continent where the banking rate is at  11% average  with large differences between countries. Paying for online purchases with his credit card also still a little way acclaimed even by this elite. But a new offer comes up: that of the “banking” card without bank account. This is a payment card such as Wari, Poste Cash in Senegal, which is charging prepaid and allows purchases in hypermarkets, restaurants. Providers of these payment solutions, to adapt to e-commerce, are now developing integrated API (like Paypal).

It is even possible for some sites to pay by mobile money.

All these new technical means have not yet entered the African use and the best way to charge an order online in Africa still remains the Cash on delivery.

Another e-commerce

Facing the sea of ​​general e-commerce sites  where you can find every and anything, there is room for sites that make a difference and have an interesting concept.

Among them is SOORETUL, a Senegalese e-commerce site. SOORETUL (It is not far anymore, in the local language) is a site that sells in Senegal locally-processed products. The site supports agricultural processing structures by providing a marketing platform where they can sell at retail and large scale and by bringing together a real community. It brings together the rural offer and urban demand in one click, by providing customer with products harvested and transformed locally.

A social initiative to encourage!

Besides, we AWALEBIZ, are a platform serving the African creation.

All actors in African art, culture and fashion will find on Awale Biz an exhibit space for their creativity. They have the opportunity to sell their work locally and internationally. The aim is to highlight African expertise and giving it a global dimension. The vendors are everywhere in Africa (Senegal, Benin, Cameroon, Ghana, …) and can sell their products all over the world; the site is promising to offer the best quality to its customers so the selection is so neat.

All these new players in the ecommerce are force of proposal to move the African digital world.

And the prospects are good: the firm McKinsey, in a study on e-commerce in Africa, provides that this market could weigh in 2025 75 billion dollars to 600 million African consumers. The multiplication of the Ecommerce offer therefore reflects a new dynamism of the African economy.

Where websites such as the French Cdiscount are implanted in Africa, hopefully African stakeholders will not be on the sidelines to take advantage of this opportunity.

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Auteur/Author: Aissatou GAYE

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