African E-Commerce Increases
The African e-commerce market developed and grew as access to technology bloomed on the continent. Kenya and Uganda introduced mobile payment facilities in the mid-2000s, which helped usher e-commerce into Africa.
The rise of more digitally savvy shoppers continues to push this growth. DROP2GO looks at eCommerce growth in Africa and how last mile delivery adapts to deal with it.
E-Commerce Across the Continent
Africa has the second-largest population in the world, also regarded as the “youngest” population. Mobile internet access dominates the massive potential digital audience in Africa.
The 2017 Accenture Digital Consumer Survey revealed the growth of technological access. It found the number of smartphone users across Africa increased to more than 226 million between 2016 and 2017. This continual growth in access to the internet serves the e-commerce market well. Africa’s e-commerce market is estimated to double in size, with a revenue of US$75 billion, by 2025.
Technology and innovation are the keys to Africa’s e-commerce success. Business to business collaboration is a smoother process with the introduction of digitally based platforms. In addition, Africa is developing business ecosystems that are blossoming as access to technology increases.
Nigeria, Kenya and South Africa are the forerunners of e-commerce on the African continent. Nigeria boasts the most significant e-commerce consumer spend, according to a report by PayU. It is so large that it is several times that of South Africa and Kenya combined.
Nigeria’s success in the e-commerce realm comes from the country’s embrace of technological solutions. Small businesses use digital platforms such as Whatsapp and Instagram to communicate with clients, increasing their customer base.
South African E-Commerce
Opportunities for e-commerce growth in South Africa have been vast over the last year or so. The COVID-19 pandemic saw a considerable rise in online customer interest.
This rise is particularly apparent in specialist industries like beauty, cosmetics and fashion. In fact, PayU found the year-on-year online spend on cosmetics increased by 140% between 2019 and 2020. This trend should continue with a growth of R2.4 billion by the end of 2021!
South Africa is ahead of the curve; a 2019 article by Pargo states that we have an 80% smartphone adoption rate. Access to any online store from the palm of your hand is attractive in our fast-paced world. It is no wonder that digital shopping convenience is drawing in more and more South African customers.
Affect on Last Mile Delivery
All this e-commerce growth is excellent, but how has it affected the last mile delivery industry? Africa faces last-mile delivery challenges that are unique to our continent. With a lot of creativity and innovative logistics solutions, these challenges are met head-on and here’s how –
Long Lead Times
Last mile delivery in Africa often involves a lot more “miles” than in other places. Many intermediaries need to be used to get your goods to remote areas. The long lead times, as a result, can make your customers unhappy and drive costs up.
The DROP2GO Solution
DROP2GO allows you to select the transporter with the shortest lead time and most cost effective price. Instead of going through several go-betweens, we connect you directly to the transporter you need in line with your budget.
Africa is once again unique in our varied selection of addresses. Rural areas, settlements and high-rise living addresses can be challenging to navigate and easy to confuse. This can lead to failed deliveries which increase costs for the supplier.
An added difficulty is that many people do not have a formal address. Therefore, if you can only deliver your goods to formal addresses, you reduce your potential client base.
The DROP2GO Solution
DROP2GO’s software makes failed delivery a thing of the past. Our app checks and confirms the customer’s address before submitting it to the transporter. The app also provides a chat functionality enabling the delivery person to communicate directly with the customer to confirm the delivery time and address.
With DROP2GO, you can also make use of a courier who has collection points. This way, you can serve all your customers’ needs regardless of their address.
Remote Area Complications
Africa is known for its diverse landscape. While this makes our continent a beautiful place to live, it can complicate last-mile delivery.
Customers in rural and remote locations can be challenging to reach. Many factors affect the rustic last mile. Difficult to find addresses, high delivery costs, rough roads or no road network complicate delivery.
The DROP2GO Solution
The DROP2GO app links any supplier to transporters of any kind. So even a medical supplier that needs to get supplies to rural health care centres will find what they need.
The DROP2GO app thoroughly vets and continually monitors transporters performance. Suppliers can see from the transporters profile if they can deliver remotely—DROP2GO, designed in Africa for Africa, takes remote areas into account.
Use DROP2GO to create your own network of independent delivery agents or connect to a pool of vetted delivery partners. The choice is yours.
Both e-commerce vendors and delivery companies have a massive opportunity in the current climate. Customers want mobile solutions to their retail and delivery needs with visibility, security and low cost. The African market calls for disruption in e-commerce and last mile delivery. Take advantage of the steadily growing markets by connecting with DROP2GO and your customers.