“We were very surprised by the appetite of consumers for products that are sometimes expensive. We were very surprised that we could find a way to make the deliveries happen. A lot more positive than negative things were happening. I’m very bullish about e-commerce in Africa because what is unique in this continent is you have this very big population—over one billion people—and they are very connected.
There are more than 400 million internet users in Africa, which is the second-largest internet-user population on the planet, just after China. And yet distribution for goods and services is challenging. And it’s notorious that in Africa, for consumers, it’s more difficult to find goods and it’s more difficult to shop. Because of mobile and because of the internet, consumers now have a way to access goods and services in a more efficient way.”
The remarks of Sacha Poignonnec, co-founder of Jumia (formerly known as Africa Internet Group) speaking to McKinsey & Company in 2019.
There is indeed an appetite for convenience everywhere on the continent. It doesn’t necessarily translate into a viable business for companies venturing into the e-commerce space. Although the availability of technology is more widespread the challenge still remains of the affordability of those devices with access to the internet and that’s saying nothing of the data tariffs. It would be remiss of me not to mention USSD (Unstructured Supplementary Service Data). The ease to which it has made certain transactions. Banking on the go and shopping a great deal easier allowing anyone with a cellphone to easily use this method of transacting. Of course after registration with your bank or service provider.
The Pandemic’s Effect on Small and Emerging Business.
With the ongoing Pandemic one would think these e-commerce businesses are experience a boom. It hasn’t been the case everywhere especially for informal, small, or emerging business. There are consumer tendencies or cultures that have proven difficult to overturn. We are all accustomed to handing over money and getting the product immediately. The trust it takes to give someone money with the hope that the product arrives as specified is quite the hurdle. It is a difficult task for most to make ends meet during lockdowns of varying degrees. Most would go to traditional establishments than to try an emerging business that operates remotely.
Businesses have to find ways in which to advertise, if they don’t already have a web platform. This usually means using social media. Even if they can get their product displayed to the public, they have to prove that they can deliver what they have promised. This isn’t easy because no one is ready to part with their money without any guarantee of delivery. With anything bought or sold, there will be a need to present some sort of track record.
The fear of ever increasing surcharges quells whatever courage anyone who would have thought about making that purchase (unless of course there isn’t any other option).
Africa’s needs are bespoke (as they are on any other continent). Innovators have been trying to meet those needs by adapting their business models to suit the present and anticipating where those needs may be next.
The United Nations Economic Commission for Africa is having virtual conferences and workshops titled ecomConnect Day on the 4th of June. The event runs from 10 AM to 6 PM (CET) and the focus of the event is:
“E-commerce is emerging as one of the key priorities for policymakers and business people alike in the response to COVID-19. Online ordering has provided a vital supply channel for many, and has preserved jobs even while large sections of the economy have been shut down.For developing and least developed countries, already behind in adopting e-commerce, the need to accelerate digital transformation is apparent: the economic consequences of the crisis demand ambitious solutions including innovative measures to promote inclusive access to the digital economy and its power to create opportunities and jobs.”
Speakers at the event will include:
H.E. Ms Paula Ingabire, Minister, Rwandan Ministry ICT and Innovation
Mr. Albert Muchanga, Commissioner for Trade and Industry, AUC
Mr. Wamkele Kene, Secretary General, AfCFTA
Mr. Henri Monceau, Director, Département du numérique, OIF
Ms. Dorothy Tembo, Executive Director ad interim, ITC
Mr. Jamie Alexander MacLeod, Trade Policy Expert African Trade Policy Centre, UNECA
Mr. Daniel Yu, Founder & CEO, Sokowatch, Kenya
Mr. Francis Nkurunungi, COO and Co-founder, Xente, Uganda
Ms. Esther Asante, Managing Director, OTI, Ghana
This conference should go well beyond what was mentioned above. For those looking to find out the state of eCommerce in other African countries and routes to solutions, it’s an event not to be missed.