E-commerce in South Africa: a snapshot in August 2020
IN SOUTH AFRICA
TRENDS REPORT | AUGUST 2020
Running an online store requires a strategic communications approach that is considerate of a customer’s accessibility, wants and needs, and
finding digital and social opportunities to create meaningful engagement, while selling a product or service.
OVERVIEW OF THE
SA's online retail
accounts for just
1.4% of total retail
Rise in online
compared to the
Online retail in
USA and China of
“South African e-commerce market is an untapped billion-dollar
industry, and this is an opportunity for the Government to create a
policy and regulatory environment that enables a localised,
innovative, inclusive, e-commerce model that uses existing logistics
systems to drive the industry.” - Alison Gillward, ICT Africa.
This is set to consistently rise as more and more bargain-seekers
are heading online to buy technical consumer goods such as
cell phones, electronics, and home appliances.
HIGH MOBILE PENETRATION
SECURE PAYMENT OPTIONS
CHANGING SPENDING HABITS
GROWTH IS STRONG THANKS TO
Claim they made an online
purchase after seeing the
in South Africa
18 - 24 years 25 - 34 years 35 -44 years 45 - 54 years 55 - 65 years
South Africa's preferred online retail
payment methods 2020
Users by age 2020
As of January 2020, it was found that 12% of the female
and 17% of the male market, aged 15 years and above,
had made online transactions.
These transactions include mobile money
accounts, online purchases or
bill payment and others.
Being aware of your audience demographic and spending
methods play a large role in crafting your online
WHO IS CONNECTED?
Internet users in South Africa
There are 36.54 million internet users in South Africa
The number of internet users in South Africa increased by 1.1 million (+3.1%) between 2019 and 2020
Internet penetration 62%
Social media users in South Africa
22 million social media users in South Africa
Users increased by 3.5 million (+19%) between April 2019 and January 2020
43% INCREASED IN
SHOPPING APPS USAGE
Global reattributions of shopping app increased by 43% month-on-month in
*Where a user has returned to an app due to a retargeting campaign
There is a digital divide and
people not having access to
credit cards to make online
Warrick Kernes, founder of Insaka
eCommerce Academy, said the
“increased access to smartphones
and alternative payment options like
Scode from PayFast allow a larger
portion of the population to shop
online and then pay in-store at
Checkers, Shoprite or hundreds of
Lack of e-commerce tools and
understanding for small
Security being a major issue in
SA where people are
concerned to purchase online.
the fear of missing a delivery or
waiting around all day
high delivery cost
lack of appropriate address
of people who have not shopped
online agree on having:
said they prefer to
at a mall. *
South Africans visit
a mall at least once
*Before the Covid-19 pandemic
THE IMPACT OF COVID-19
ON THE LANDSCAPE
“E-commerce in the country has
been accelerated by 3-5 years,
which will bring South Africa closer
to international levels.”
- OneCart CEO, Lynton Peters
"Since the start of the lockdown
period we’ve seen a 40% increase
in page views per user and a 15%
increase in basket sizes,” says
Laurian Venter, director of online
“I think that is the nature of Covid-19,
you do not have a choice; it’s either
you adapt or you die.” - General
manager of marketing retail and
procurement for the company, Batya
Global WebIndex’s ninth release of its coronavirus research has revealed that nearly half of global consumers do not expect to
resume shopping in brick-and-mortar shops for ‘some time’ or ‘a long time’ once lockdowns eases.
CONSUMER DEMAND HAS CHANGED
"In economic downturns, consumer demand for 'nice-to-have' products goes
down as buyers focus on their more basic needs. Health, wellness and safety –
products that fit into the lower parts of Maslow’s Hierarchy of Needs – become
the top priority." - Lucas DiPietrantonio, CEO of Darkroom
With Millennials, 'Generation Greta' and the 'Coronials' holding future-buying
power, businesses have no choice but to align their products accordingly.
"While the pandemic has
certainly been humbling
and thought-provoking in our role and
responsibility as humans, there has
been an increased awareness and
demand for environmentally sound
products pre-Covid." - Michaela Gabriel
Projected unemployment rate
Clothing & shoes
Type of goods that will become
normal as online purchases:
As people move down the
hierachy of needs, their
buying behaviour will
CHANGE IN SENTIMENT
"Things will never be the same,“
"There will be no more normal,"
"We shouldn't want to go back to the way things were."
With fear and uncertainty created by the pandemic for everything to change in order to
survive (physically, mentally, economically), and taking into consideration South Africans tend
to be more conservative – driven by culture and tradition – the impact of Covid-19 was so
great it managed to push people outside of their comfort zone to find a resolution.
As a result, the sentiment towards online shopping has significantly changed as it is now
embraced as the answer to not only continue commerce safely, but to keep the
SO, WHAT DOES THIS MEAN FOR MY BUSINESS?
There's no need to reinvent the wheel. It’s about readjusting budgets for
new resources, while still putting the client first in all solutions.
Now is the time to explore new avenues with the help from digital &
communication experts and together use your business/brand to lead the
way for the rest.
“What we will ultimately need to accompany the years of thought that
have been put into the economic story of us is for someone to take the
lead and not fear making the mistakes that naturally come with it.
There's opportunity in crisis.” - Ron Derby is the editor of Fin24.
WHAT CUSTOMERS WANT
Your money is safely transferred, your identity and details are secured, your package is safely
distributed. Always-on communication driven by ‘live tracking’ function and detailed delivery
information – who is delivering your goods, when, where, exactly.
A clear message and guarantee of security.
Physical money currently
acts as a vector for the virus’
spread whereas technology
makes payments possible
and safe. Governments and
startups across Africa are
implementing measures to
shift payment transactions
toward mobile money and
away from cash, as
recommended by the World
An increase in artificial intelligence (AI) can mean an increase in drone deliveries and
automation of warehouse processes, as well as the monitoring of emerging trends that
human analysis would miss.
Reduced store time
Quick turnaround times
The single most critical factor in the success of
online retail activities is customer service.
#1 CUSTOMER SERVICE
of respondents to the
Global WebIndex’ survey
regarded customer service
as highly significant.
said it is somewhat
important. Other major
factors include security,
privacy, and delivery.
Pick n Pay, launched its Collect Direct email ordering service which lets customers email their
shopping list to their nearest participating store for collection.
Other South African companies like Zulzi, Yebo Fresh, Netflorist, andhave also adapted to serve the
growing online FMCG market in South Africa.
OneCart offers a concierge shopping service where customers can choose products from their
favourite stores, and select their delivery date and time.
Woolworths launched a drive-through Click and Collect option, allowing customers to order online
then drive to a designated parking spot where Woolworths staff conveniently place the shopping
straight into the boot.
Exclusive Books said even if shops are open, there are customers who are reluctant to go out to
shop because the virus is still lurking somewhere. People can now order books over the phone, on
their website and through UberEats.
SA BUSINESSES WHO ARE GETTING IT RIGHT
All of them putting the customer first.
SOCIAL PLATFORMS ARE
ADAPTING TO HELP
Facebook and Instagram are adding 'Shops' to
let businesses sell products through the
social network, in addition to the existing
Marketplace where individuals can
trade among each other.
This excludes buying ad space for product and service catalogues on Facebook, Instagram and Pinterest.
Selling via your social media
pages is a great way to be
closer to your customer with
fast response time, and they
can increase your share of voice
with the share and
With a targeted approach, your new venture into the world of e-commerce can be effectively communicated via your
social media pages, directly with the audience you want in your virtual store.
Using a combination of paid ads, organic, and online shop fronts (catalogues listed on Facebook, Instagram, and
Pinterest) you can create a holistic approach to boosting sales and building a list of loyal customers.
Rewarding customers is easier with digital coupons and offerings such as free delivery, etc.
Keeping a real store is still a plus as you can combine the shopping and marketing experience. Take it further
with QR code scans in-store to unlock rewards while building valuable client lists.
There may even be a rise in popup stores in the future to satisfy the need to see a product in real life but have it
paid and organise delivery via an online space. This can be combined with launch events (virtual or not)
and compact digital campaigns to drive feet in stores.
LET SOCIAL MEDIA BE A KEY DRIVER
THE SOLUTION TO INFOBESITY
There is a major shift from infobesity (being bombarded with too much
information, promotions, and news from all kinds of sources)
Audience and potential customers are liking, following, and engaging with brands
that share their values and that check as many boxes as possible when it comes to
online shopping and experience. Targeting campaigns can drive the right message
to the right audience.
Now, more than ever, people are spending time to follow and unfollow brands that
meet their needs as well as contribute to their online/offline personas.
(and too many choices)
I think subscribe, therefore I am.
Mobile commerce is shaping the future of e-commerce in South Africa.
Therefore, mobile optimisation and a great mobile buying experience are a
must-have for all growth-minded online sellers.
Localised & targeted marketing, as well as SEO campaigns will drive traffic.
Transitioning or extending your business into e-commerce is the perfect
opportunity to revive brand messaging, remind audience of the main
offering and should be accompanied with a holistic (digital and traditional)
campaign to reach your existing and new audience.
Let's have a virtual coffee
and discuss your new
Mail & Guardian: E-commerce will assist economy
World Economic Forum: These charts show how COVID-19 has changed consumer spending around the world
MyBroadband: The coronavirus has pushed South African ecommerce forward many years
Pargo: The rise of South African e-commerce.
Statista: South Africa preferred online retail payment methods 2020
Datareportal: Digital South Africa 2020
Accenture: Rethinking the ecommerce opportunity in South Africa
Daily Maverick: E-commerce restrictions put a question mark over government’s commitment to getting the economy back on track
News 24: Ron Derby: Economic crisis an opportunity for fearless leadership
News 24: Adriaan Basson: The revolution inside and hope's enduring ambition
News 24: Isaah Mhlanga: Blue sky thinking needed to re-imagine and rebuild the economy
Entrepreneur: What COVID-19 Means for Ecommerce Startups
Ecoconsultancy: Stats roundup: coronavirus impact on marketing, ecommerce & advertising
WorldWideIndex: Online Retail in South Africa 2019
Bizcommunity: E-commerce AC19: How Covid-19 is speeding up digital transformation in SA
Business Insider: Facebook is adding 'Shops' to let businesses sell products through the social network