Nigeria, South Africa, and Mauritius are the most successful countries in Africa as far as e-commerce is concerned. In less than ten years, many e-commerce companies were created in Africa. Jumia is, for instance, considered as Africa’s Amazon. This e-commerce platform was launched seven years ago in Nigeria, and today, it has a presence in fourteen African countries. Other online sales websites in Africa today include Konga, Dealday, Yudala, Citwebb, Superbalist, Vconnect, and Mobofree.
We shall now see the top 5 reasons to develop e-commerce in Africa.
1. Outstanding economic growth in Africa.
African countries have had incredible growth rates since the turn of the millennium. According to the IMF, growth prospects in African countries will be amongst the highest worldwide between 2018 and 2023. Dynamic sectors like trading, industry, agriculture, telecommunication, and infrastructure stand as the main drivers of economic growth in Africa. With this, a consumer class is quickly rising in Africa which predicts a promising and bright future.
2. The democratization of internet access in Africa.
Developing e-commerce, online marketing, and online purchases are only possible if people can have access to the internet. Fortunately, in African countries, the use of computers, smartphones and the spread of the internet is skyrocketing and has reached unprecedented levels. According to a study realized by Deloitte last year, the smartphone market will continue to be a thriving business in Africa. In 2016, a total number of 336 million Africans owned a smartphone and this number will double by 2020. Also, three-quarters of African households will have access to the internet via their mobile phones. This opens great opportunities for entrepreneurs wishing to develop e-commerce in Africa.
3. New payment methods make online shopping easier.
The low rate of banking in Africa, the widespread distrust and fear in the payment and delivery systems, in addition to the risks of fraud, were the main obstacles of this nascent digital economy. Nevertheless, this did not stop the spread of e-commerce in Africa especially with the advent of new means of payment like mobile money.
Mobile Money is a technology that enables people to perform several financial transactions rapidly and easily with their mobile phones. Orange money, Wari, Joni-Joni, and Tigo cash propose such services in Africa. Other e-commerce companies now use these payment facilities in their sales system.
4. Foreign investors increasingly attracted to Africa.
The United Nations said last year: “The best time to invest in Africa is now.” Africa’s population will double by 2050, and this will make up a considerable market. In 2015, over 200 million African households joined the consumer goods market. Africa was formerly considered as a risk zone, and this has led to its global economic slowdown. Fortunately, emerging African governments are now waking up from slumber, and are making laudable efforts to improve their business climate.
They are looking forward to attracting more foreign investors by offering business solutions and investment opportunities to foreign firms. Furthermore, the United Nations Development Program (UNDP) is also working with private enterprises, and African governments to establish a more business-friendly economy. For these reasons, a conducive business environment is gradually emerging, especially in the e-commerce sector. Alibaba, one of the biggest e-commerce companies and Tencent, for example, aims at fostering Africa’s e-commerce market.
5. Africa’s juvenile population.
In 2015, there were 226 million youths aged 15-24 in Africa, and this number will double by 2055. This makes Africa, the world’s youngest continent. This is another reason why e-commerce should be developed in Africa as this juvenile population will constitute an important and cheap labour force. Moreover, these youths and future leaders will give a new momentum to e-commerce with their creativity and entrepreneurial spirit.
The world’s youngest continent even sets a new record: young Africans are the most connected to the internet worldwide. They represent 37% of internet users in the world, and this is a major asset to build a prosperous and dynamic e-commerce market in Africa.
There is great potential in Africa, and e-commerce can make it’s economy more dynamic. But, these future online companies have to collect reviews and ratings if they want to get more visibility beyond their boundaries. Revi, for instance, has one of the best online reviews systems for e-commerce in Spain. Revi can help these future African online companies to collect reliable reviews and ratings on their customers.