Yes, we recognise that the headline is rather obvious given how many retailers and businesses are still unable to operate as they would pre-COVID-19.
Still, what we have for you today is a bit of a deep dive into how South Africans embraced ecommerce during lockdown courtesy of data from FNB and CM.com.
We’re going to look at FNB’s data first as it serves as a good base to build off of.
The bank has looked at the performance of certain sectors and how ecommerce helped bolster sales.
Overall, ecommerce spend recorded on FNB Merchant, increased 30 percent compared to 2019.
“During the same period, the active eCommerce merchant base increased by 15 percent,” says FNB.
FNB also looked at how ecommerce helped certain sectors between January and June 2020 compared to the same period last year.
|Transportation & Related Services||-44 percent|
|Lodging/Accommodations/Travel arrangements||-51 percent|
|Educational Services||320 percent|
|Electronic, Electrical and Computer||126 percent|
|Home and Office Furnishing||77 percent|
|Restaurants, Bars, Fast food & Related||32 percent|
|Grocery shops, Supermarkets, Butcheries, Bakeries & Related||79 percent|
There are some noteworthy numbers there that warrant discussion.
As you might’ve imagined, transport services were not all that popular during lockdown and that decline of 44 percent compared to last year is incredibly concerning. The same goes for the lodging, travel and accommodation sector.
But looking further down that list, education services and the electronic, electrical and computer sector bloomed.
“Demand has been largely driven by educational services on the back of home-schooling and distance-learning requirements. This was further supported by an increase in demand for computing equipment and home/office furnishing to facilitate the distance-learning drive and work-from-home initiatives that many individuals and companies adopted,” explained FNB.
This makes a massive degree of sense, but also has us thinking back to when lockdown first came into effect and tech was not declared an essential product.
Quite clearly, it was essential and hopefully government takes this into consideration should stricter lockdown regulations come to the fore.
Where are we shopping
While many of us are shopping from home now, CM.com’s director for Sub-Saharan Africa, James Bayhack says that online shopping in South Africa is set to grow by an average of 10 percent each year.
While this differs from FNB’s reports that ecommerce grew 30 percent in the first six months of the year, we should remind you that FNB is one bank and that data is not taking the full year into account.
Regardless, ecommerce is definitely growing in South Africa and this growth is driven by one platform in particular.
“Global research also reveals that online shopping is shifting from desktop to mobile. Mobile commerce is on the rise, with mobile bringing in 46 percent of the sector’s revenue, compared to 25 percent from desktop and 9 percent from tablets,” explains Bayhack.
Something else to note is that South Africans are seemingly using ecommerce to avoid quick trips to the shops.
“Behaviour will and has certainly changed quite rapidly on the back of COVID-19. Transaction volumes have increased at a much faster rate than value, indicating a lot of smaller purchases are being made. Many customers who had reservations about shopping online are beginning to realise that the ease and efficiency outweighs trekking to shops and malls,” says FNB Merchant Services’ chief executive officer, Thokozani Dlamini.
Get the experience right
While there is an appetite for ecommerce, in order to take advantage of this hunger you have to get the online shopping experience right.
“It’s now much more likely that online shoppers will be interacting with your company from their smartphones and want you only to send them relevant, tailored content. Armed with this knowledge, you can work towards creating a unique and seamless mobile shopping experience that appeals to your customers,” explains CM.com’s Bayhack.
The director says that if companies want to take full advantage of ecommerce they will need to put a bit of time into making the user experience better than competitors.
Granted, this involves working with a cloud provider that can help create or tailor solutions to meet your needs.
While this can be costly, considering how popular ecommerce has become, we’d argue this is an investment worth making.[Image – CC 0 Pixabay]