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In this post, we will discuss the key decision points necessary before starting an e-commerce business in Africa. As per GSMA, more than half a billion African population has access to a mobile device. This number is expected to reach 725 million by 2020. Therefore, a significant increase in internet-enabled consumers.
Unique circumstances require unique solutions. Likewise, eCommerce entrepreneurs in Africa should consider the following questions:-
What will be the mode of payment?
This can be tricky. Depending on the geography, entrepreneurs may have broadly the following options:-
Mobile Payment (USSD or wallets)
Cash on Delivery
Bitcoin Payment Services
South Africa, Nigeria, and Kenya are the forerunners of the digital revolution. While a majority of the urban centers have the required bandwidth for eCommerce transactions, the challenge lies in getting rural consumers onboard. Also, mobile wallet and payment services are used mainly in Sub-Saharan Africa and Kenya. Nigeria and South Africa still prefer online payments via instant EFT and other online payment options.
Building trust and fraud prevention are the 2 main challenges. This has led to an increase in ‘cash on delivery’ transactions.
E-commerce companies in developed economies can easily deliver shipments from one point to other. However, this is not the case with Africa. Delivery logistics varies from country to country. Still, there are innovations in the area of logistics to look forward to. For instance, WumDrop in South Africa is like Uber for deliveries. Similarly, Sendy from Kenya connects consumers to motorcycle riders and drivers of vans and pickup trucks. KOBO from Nigeria operates on similar lines along with holistic logistics services.
Other Important Considerations
-Smartphones => Get a mobile responsive web app or a mobile app
-Feature phones and low bandwidth regions => Printed Catalogs
The above strategy covers both the urban and rural consumers. A smartphone user with access to 3G/4G/Wifi can directly order through the App/website. A feature phone/low-bandwidth user can order through printed catalogs via SMS and USSD. Similarly, scanning of QR codes can also facilitate smooth and swift transactions.
Other than ‘mobile money’ and ‘cash on delivery’ merchants can incorporate the following options:
-virtual debit cards
We have iterated the importance of social selling every now and then. As per ‘we are social’, about 120 million Africans were using Facebook each month in 2015. In fact, It opens new avenues for engaging the consumer and forge lasting relationships.
To top that, using IM apps as customer service channels leads to an easy workflow and a positive brand image. Some of the benefits are as follows:-
-No spam and unwanted subscriptions
-Also, conversation history is readily available
-No waiting time or on-hold time
-Returning users can be easily recognized
The consumers are there. Technology and infrastructure are continuously improving. Innovators are all geared up. Hence, the time to build a brand and loyal following is NOW.
Hence, to get started with your e-commerce store, Click Here