In Africa, more and more online sales sites are appearing. Little by little, the consumption habits of African urban populations are changing, and online shopping is now becoming more democratic. In fact, e-commerce sites manage to combine services in line with African realities and local needs while respecting quality standards. Will this new trend, which is gradually becoming part of African mentalities, continue?
What are the factors that favor the emergence of e-commerce in Africa?
The impressive growth in mobile use is the main driver of e-commerce. Currently, around 12% of West African consumers make purchases using their mobile phones. Despite low Internet penetration in Africa, it nevertheless provides Internet access to more than 20% of Africans.
Yet the emergence of this sector of activity is mainly justified by the inherent lack of products and services that the African population has to face. One of the first obstacles to be avoided concerns the almost non-existent access to traditional means of payment and used in Europe or on the American continent. The banking rate is only 12% in Africa.
What means of payment should be considered for Africa?
The e-commerce solution falls within the telecoms sector. Indeed, more than 60% of rural areas in Africa are connected to the telecom network. Conversely, banking establishments are located only in large urban centers. This restricted access to bank branches benefits telecoms: mobile telephony is, in fact, in Africa the means adopted to carry out financial transactions. This is a real opportunity for the 700 million subscribers.
Whether they are telephony giants or startups, these companies are participating in the construction of new business models such as Afrimarket, whose specialty is the transfer of money cash to goods. This method allows Africans to withdraw the money received in the form of goods through a network of partner traders.
Cameroonian start-up Infinity Space has launched the WeCashUp application intended to make online and offline purchases and to pay using a mobile in a reliable, secure and low-cost manner. You do not need to have a card or bank account to use this solution. Concretely, it is about enabling the entire African population with a mobile phone to make purchases on mobile or web applications integrating the WeCashUp API. This solution makes it possible to anticipate risky transactions and therefore to reduce possible fraud from existing mobile money systems.
In Kenya, more than 20 million people have adopted the payment method introduced by Vodafone: m-Pesa.
Infrastructure development: a prerequisite for the development of e-commerce
To allow e-commerce to experience significant growth, it is essential that Africa equips itself with the key infrastructures essential for the proper functioning of this activity. On the one hand, this concerns the logistics infrastructure (street addressing, road networks, relay point, etc.) to be improved. Some companies such as Jumia have surrounded themselves with a fleet of motorcycle couriers (to deliver deliveries to populations living more than 2 kilometers from an asphalt road) combined with a cash-on-delivery payment method.
In addition, internet coverage and existing hosting solutions are woefully insufficient. The regulatory framework must also adapt to these new consumption patterns to encourage businesses or individuals to invest.
Despite a lack of electronic payment systems and limited access to the Internet, many African entrepreneurs are embarking on the adventure of e-commerce. This dynamic can be explained by issues common to all African countries: lack of quality commercial infrastructure, growing increase in the number of internet users, appearance of a new middle class keen on consumption, capacity of the African population to adopt innovations very quickly.
What is the room for improvement in e-commerce?
There is still significant room for improvement in this sector of activity. Many African e-commerce sites do not hesitate to conquer new markets on the continent, their turnover is growing rapidly. The Nigerian company, Konga, has spread across the Economic Community of West African States.
The Made in Morocco site is currently the largest e-commerce platform that exists in Africa. Its wide range of products is made only in Morocco.
What are the prospects for growth?
The e-commerce sector is changing rapidly in Africa. According to some experts, Africa will experience a technological boom as important in e-commerce as that it has seen in the telecommunications sector.
With growing demographics, the evolution of virtual commerce seems well underway on the African continent. Nevertheless, consumer mistrust in payment systems, logistical challenges and the risks of fraudulent transactions constitute potential obstacles to the development of this new form of digital economy.
E-commerce in Africa currently represents 2% of the world market, however its growth prospects remain promising for this continent where everything remains to be built.