In early 2013, the Boston Consulting Group published ‘Ten Things to Know About African Consumers’. Seven out of ten of these continent-wide trends are likely to boost online retail growth and B2C e-commerce in Africa. I’ve listed the brief below.
- Optimism about the Future – African’s, with the exception of Northern African nations are exceptionally positive about future economic developments.
- By and large, Africans are very entrepreneurial. Partially due to a lack of established career paths and an inadequate formal education structure, ambitious individuals tend towards creating new opportunities.
- Techno- Freaks – There is wild craze for all things digital and the speed and scale the internet and technology uptake is driving major change and economic opportunities.
- From football clubs to soft drinks, the African continent loves the international brand. This is a big selling point for international players with a serious brand appeal of value add.
- Massive discrepancies are often found in official market data and real markets, which include parallel and informal sector sales, can often be much higher and reflect greater opportunities.
- Quality sells. Despite higher prices, a better value-add and long-term investment coupled with higher prices can conquer market share. Look at the Toyota brand, but there are many other examples to back this up.
- Successful, modern retail outlets, greater varieties and cheaper products drive the cognizant African consumer. The evolving retail preferences on the continent imply that if online retail can offer convenience as well as opportunities for cost-saving, then it has a bright future in the coming years.
While online retail has a ways to go, more affluent markets in Africa are ready for the practice and as the rapidly growing economies begin to stabilize it is expected that a massive wave of online e-commerce will follow. Africa may be lagging in online stores and e-commerce, but with growing wealth and broadband availability a massive spike is expected of the 3-7 year period with growth of between 20-25% in the next 3 years leading up to it.
Author: Jonathan D. Novotny is an e-commerce evangelist and co-founder of the CloudShop/CloudSales online retail franchise.