Over the past 2 years there has been an increasing amount of talk on the readiness of Zimbabwe to adopt e-commerce. A number of articles published either imply or affirm that Zimbabwe is now a ripe market for e-commerce. Well, the truth is, this is not a simple matter to conclude.
E-commerce is a tool for business and as such requires some objectivity to assess whether or not it is worth to invest in this area. The adoption of e-commerce in a Zimbabwe is dependent on multiple factors that all need to be considered. This is therefore my attempt to be more objective regarding this topic. Is Zimbabwe ready for e-commerce?
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One country where e-commerce is thriving is our southern neighbour, South Africa. Among the best e-commerce companies in the country are: Zando, Yuppiechef, Bid or Buy, property24, TravelGround, HomeChoice among many others. Other examples include Konga in Nigeria, Jumia (Nigeria too), Rupu and FargoShopping in Kenya amoung a number of others on the continent.
My idea here is to use South Africa as a case study and assessing the number of ingredients they have for e-commerce to thrive and then assessing if we lack any such ingredients. Of course this is not conclusive, but it helps to enhance perspective regarding this issue.
Usually the major barriers to the adoption of e-commerce in Africa are internet access, awareness, payments, competition and economy. Thus evaluating whether Zimbabwe is ready for e-commerce we would need to cover these aspects.
1. Internet Access
E-commerce requires people to buy and sell online and thus internet access is the water in the fish pond. Question is: Does Zimbabwe have enough internet access to ensure the viability of e-commerce? Taking South Africa as our case study, DMMA reveals that the country has 39% internet penetration. This is was a survey based on adults only. POTRAZ , Zimbabwe’s telecoms regulator, has said that Zimbabwe’s internet penetration currently stands at 35%. These figures are roughly the same. However we realise that quoting different figures from different sources can be misleading we therefore went to Internet World Stats for 2012. South Africa was said to have a penetration of 17.4% (this survey considered the whole population) and Zimbabwe’s internet penetration was said to be 15.4%. The penetrations are still roughly the same.
People have to know about buying online for e-commerce to be a success. So question here is: How many people in Zimbabwe know about buying goods online? There is no fast way of answering this question because such a survey has never been undertaken. However it is worth noting that, the most active e-commerce market segment in South African is men aged 35 to 44. Doing a rough analysis, I’d say most men I know in that range know about buying goods online, only many don’t know how.
To buy a product online one needs a MasterCard, PayPal or Visa account. Fact is there is not yet a seamless solution in the mould of PayPal that merchants and the majority of internet users in Zimbabwe can use. Local banks are yet to start enabling eCommerce accounts for merchants to accept popular credit cards like Mastercard and VISA. And on the customer side of the payments problem though banks will not disclose how many people have MasterCard or Visa cards, my guess is not many. PayPal itself is already out of the question because it still has restricts people in Zimbabwe from creating new accounts.
While mobile money paymen solutions like EcoCash, OneWallet and others may be the solution, so far it’s all just speculation as internet payments seems not a priority for these companies.
4. Competition in the industry
Competition is also another contributor. Businesses will adopt new technology as a way to beat competition, to reach a wider customer base. However if a business is already failing to meet demand then it is highly unlikely it will channel efforts to increase its customer base. Question is: Do we have enough competition in Zimbabwe to champion the adoption of e-commerce?
E-commerce is COMMERCE. That means it is heavily dependent on the economy of the country. Question is: Are the people in Zimbabwe ready to buy groceries and be charged $10 for delivery on Zimbogini. Or a person will look at that $10 and say, “What a joke.”
Zimbabwe has however seen a stabilization of its economy after the adoption of the US dollar and has recently been said to be experiencing real growth. The “middle class” is currently able to consume much more than before 2009. But even this growth may not be adequate for people’s wanting to buy online.
Is Zimbabwe ready for e-commerce? There is no clear-cut answer to this question, well not as far as I’m concerned. What are your thoughts?
9 thoughts on “Assessing Zimbabwe’s readiness for eCommerce”
You left what i’d call the most important aspect after payment solutions… that is logistics & fulfillment. It is almost impossible when there is no reliable flow from clicking ‘buy’ to receiving the item bought.
I would also add population size, as this determines the market size as well as economies of scale. SA, Nigeria and Kenya has larger populations than zim.
companies in Zimbabwe should develop an e-commerce strategy that integrates with existing payment platforms such as Ecocash. this will effectively improve the use of e-commerce business as customers realise benefits of value addition.
I don’t know but if we look at how it happened in the valley; the internet came first, then people actually started finding services they liked to use online. Anyone who’s read humble beginnings of softwares such as Winamp(is one i think. not sure) has come across founders narrating how they got che(ck/que)s sent by snail mail and then they would snail mail back a copy of the software. Then later came the age of early payment systems which after a wider adoption forced financial authorities to see and carve the the security and regulatory standards today.
Like I said I don’t know, but it seems rich consumers experiences come first, naturally pushing make-shift payment methods into existence and later when there is enough noise to not ignore formalities come in from industry regulators.
So to say ready? That may not be the question. The fairly mature ecommerce industries out there if you revisit their origins have silly stories to tell. They just started and things started falling into place. Zimbabwe has started and things will inevitably fall into place.
You do not need online payment. Nigeria’s online retailers are being increasingly successful by accepting cash payment upon delivery.
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