It is no longer a question of “if” but “when” South Africa’s ecommerce market will catch up to the rest of the world.
Such has been the boom in digital sales since Covid-19 that even the most conservative estimates suggest 2030 will be the year that there is no longer a discrepancy between the country’s sector and markets in the developed world.
Some, like Rand Merchant Bank, indicate that point could even be reached as early as 2026. By next year it is expected that online sales will have hit the R225-billion mark in South Africa.
The ecommerce surge is already proving fertile ground for entrepreneurs. However, it is also important that they draw up a sound business plan, says Jaco Roux, Head of Product at ecommerce ecosystem Bob Group.
Since competition is becoming stronger, they cannot afford to be lax in their approach.
“You first need to decide on your niche,” Roux says.
“Do market research to determine if the market exists and that you have enough margin in the products that you want to sell. The next thing is to choose the right ecommerce platform.”
Once these boxes are ticked, he says, the merchant needs to develop a solid digital marketing strategy to reach their target audience effectively. Finally, a fulfilment strategy needs to be developed.
“Bob Go, our shipping offering, already has multiple courier options and integrates directly into your ecommerce platform.”
Roux says entrepreneurs should always be mindful of what a successful ecommerce operation looks like.
For one, the website should be user-friendly, responsive and built on reliable technologies. For another, there needs be a secure payment gateway in place to process transactions smoothly.
“You are also looking for a comprehensive logistics solution, incorporating shipping aggregators and pickup point networks, while you will need strong customer support and service functionality to build trust and loyalty.
“From a financial perspective, you will require in-depth data analytics to be able to track and measure your marketing spend.”
Entrepreneurs should also bear in mind that the South African market is unique, he says.
Factors like the diverse demographic and economic landscape require tailored marketing and product strategies, and the significant imbalance in internet penetration in terms of urban areas and rural areas should be considered.
“Taking into account the high usage of mobile devices for internet access in South Africa is another must,” he adds.
He advises entrepreneurs to start out with a minimum viable product (MVP) to test the market and respond to any feedback. The focus should then fall on building a strong brand presence online through search engine optimisation, social media and content marketing.
Once the business is up and running, they can identify certain milestones to assess their progress. These include:
- Achieving a set number of sales or reaching a specific revenue target within the first year;
- Building a significant online presence and customer base;
- Successful integration of logistics and payment systems, evidenced by reduced delivery times and increased customer satisfaction; and
- Scalability of operations, ensuring the business can grow without compromising on service quality.
Roux cannot emphasise the importance of an ecommerce blueprint enough.
“It provides a clear roadmap for growth and scalability, minimising risks and uncertainties, and it assists in identifying potential challenges and opportunities in the ecommerce space early on.”