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E-commerce is growing in Africa, but not in exactly the same form as other regions

Andrew Shaw

Online Manager, Regional Solution Centre, Sub-Saharan Africa, Amadeus IT Group

The dominance of mobile connectivity across Africa has shaped consumer trends in ways that are inspiring new and innovative services that cater to this receptive audience.

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This growth is yet to blossom to the levels seen in the United States or Europe, which has everything to do with a lack of infrastructure, reliable services – including electricity – and established reputations and online buying habits.

In the absence of such an established framework, new and unique ways have evolved to deliver an online shopping experience, but in an African context.

This is probably best illustrated in the example of Nigerian online store Jumia that has adopted a pay on delivery system to overcome the lingering distrust of digital malls.

This model has been recognised as one of five key trends shaping e-commerce in Africa, together with: e­commerce companies building in­house logistics networks to compensate for the lack of basic infrastructure, mobile commerce driving e­commerce access and interactions, the emergence of a hybrid e-commerce model reiliant on significant offline inventory stocking and that quality service and referral influence are key to driving adoption of online shopping.

Global payment and money transfer providers have recognised the potential in this market, as demonstrated by Mastercard’s partnership with the Nigerian government to roll out smart ID cards that include credit card capabilities. Network operator Orange has also upped the ante by introducing the first money transfer service between two or more countries.

The emergence of Orange, and Safaricom, MTN, Vodafone and Vodacom, on the financial services scene is another hallmark of Africa’s mobile money transfer and payment environment. By virtue of their reach, infrastructure and back­end systems the mobile network operators are perfectly placed to enhance their value to subscribers, as well as their own bottom line.

Even experienced mobile payment operators can falter, though, as shown inM­-PESA’s stuttering entry into South Africa, and is a reminder of the vast differences in consumer culture and buying habits in the different countries.

Download our reportA Digital Savannah: Africa’s e-commerce promise for more on this trending topic.


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