The Future Of e-Commerce In South Africa


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This is a presentation from a lecture I was invited to deliver to the students at Midrand Graduate Institute on the Future of eCommerce in South Africa

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  • The Future Of e-Commerce In South Africa

    1. 1. <ul><ul><li>The Future of eCommerce in SA </li></ul></ul><ul><ul><li>Ramon Thomas </li></ul></ul>
    2. 2. Why People Shop on the Web <ul><li>Convenience and ease of use </li></ul><ul><li>Shoppers only buy 5% of the time </li></ul><ul><li>e-Commerce is International </li></ul>
    3. 3. eCommerce Examples <ul><li> </li></ul><ul><li> </li></ul><ul><li>iTunes </li></ul><ul><li>Yahoo! </li></ul><ul><li>Google </li></ul>
    4. 5. Amazon Marketplace ( i.e:Third-party Marketplace ) is's fixed-price online marketplace that allows sellers to survey their goods alongside Amazon's offerings. Buyers can buy new and used items sold directly by a third party through using Amazon Marketplace. This concept is similar to eBay's successful This sales strategy and program has been very profitable for, with a commission rate of 6 to 15 percent of the sale price, a $0.99 per-transaction fee, as well as a variable closing fee. Users can leave feedback on transactions, similar to eBay's feedback system, except that Amazon uses a five star rating system instead of just positive, neutral, or negative. Any feedback less than four stars will negatively affect the seller's rating. It is important to note that this rating system is different from Amazon's regular book rating system - while their book rating system should be used to vote on the content of the book, the quality of the publication, the individual's opinion of the book, or any number of other factors, the Amazon Marketplace rating system should only be used to describe the quality of the transaction and whether the product meets the criteria in the seller's listing. Negative feedback, for instance, because a book is old and expensive, affects the seller's feedback rating negatively, and causes other buyers to be less likely to purchase from that seller. Another big difference in the Amazon vs. eBay feedback is reciprocity. Amazon has a one way street. The seller is always judged for the feedback left but the seller is powerless to effect the feedback of the buyer because the buyers feedback is not included in any metric Amazon uses. If a buyer on eBay has bad feedback you can block them but on Amazon you have to accept a sale from a bad feedback customer. Without this measure, customers who feel for any reason to leave a bad feedback can and do. Check it out for yourself. Take a Powerseller on eBay and see if they are selling on Amazon you will see similar items but feedback will be at least 5% off on Amazon what it is on eBay.
    5. 17. The Numbers <ul><li>1.1 billion Internet users (4 million)‏ </li></ul><ul><li>2.5 billion Cellphone users (32 million)‏ </li></ul><ul><li>100 million websites </li></ul>
    6. 18. # Websites each year since the Web's founding.
    7. 19. Blogosphere
    8. 21. Cluetrain <ul><ul><li>&quot;A powerful global conversation has begun. Through the Internet, people are discovering and inventing new ways to share relevant knowledge with blinding speed. As a direct result, markets are getting smarter—and getting smarter faster than most companies.&quot; </li></ul></ul><ul><ul><li> </li></ul></ul>
    9. 23. Online Music <ul><li>Rise of Mp3 (1997)‏ </li></ul><ul><li>Napster (1999)‏ </li></ul><ul><li>Declining album sales (post 2000)‏ </li></ul><ul><li>iTunes & iPod (2001)‏ </li></ul>
    10. 25. eCommerce Growth <ul><li>Top Category: Video Game - 159% </li></ul><ul><li>US $170.8 billion in 2006 ($102.1 billion)‏ </li></ul><ul><li>Reach $200 billion by end of 2007 </li></ul>
    11. 26. Online Retail in South Africa <ul><li>R514 million in 2005 </li></ul><ul><li>Online Air Ticket Sales: R1.8 billion </li></ul><ul><li> 1 st to reach R1 billion </li></ul><ul><li>826 online retail sites </li></ul><ul><li>Experience Curve </li></ul>
    12. 27. South African eCommerce <ul><li> </li></ul><ul><li>MWEB Shopping Zone, Digital Mall </li></ul><ul><li>Pick ‘n’ Pay, Woolworths </li></ul><ul><li>, Exclusive Books </li></ul><ul><li>NetFlorist, Cybercellar </li></ul><ul><li>Digital Planet, Ascot Direct </li></ul>
    13. 38. Components of eCommerce Shop <ul><li>Shopping Cart </li></ul><ul><ul><li>osCommerce </li></ul></ul><ul><ul><li>Zen Cart </li></ul></ul><ul><ul><li>ViArt Shop </li></ul></ul><ul><li>Payment Gateway </li></ul><ul><ul><li> </li></ul></ul><ul><ul><li>Chase Paymentech (Orbital Gateway)‏ </li></ul></ul><ul><ul><li>Cybersource </li></ul></ul><ul><ul><li>LinkPoint (owned by First Data)‏ </li></ul></ul><ul><ul><li>VeriSign Payflow (Owned by PayPal)‏ </li></ul></ul>
    14. 45. Resources <ul><li> </li></ul><ul><li> </li></ul><ul><li> </li></ul><ul><li> </li></ul><ul><li> </li></ul>
    15. 46. Contact Details: Ramon Thomas <ul><li>[email_address] </li></ul><ul><li>Tel. 011 4331034 or 082 9407137 </li></ul><ul><li> </li></ul><ul><li>Connect with me on LinkedIn , Facebook & MySpace </li></ul>
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