A Playbook to Win Over Shoppers
The eCommerce market is growing in South Africa, and with it, the number of players is also increasing. The digital transformation of a society is the precursor of eCommerce. How well a market is growing can be measured by the rising number of internet users. A Hootsuite report titled Digital 2021 throws light on the […]
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The eCommerce market is growing in South Africa, and with it, the number of players is also increasing. The digital transformation of a society is the precursor of eCommerce. How well a market is growing can be measured by the rising number of internet users.
A Hootsuite report titled Digital 2021 throws light on the annual digital growth of South Africa, giving insight into the daily time spent by South Africans online, either on mobile, or on the internet, or consuming media.
There were 38.19 million internet users in South Africa, as per the report. These 38.19 active internet users comprise 64 per cent of the total population of SA. There was an increase of 1.7 million users triggered by the pandemic and lockdown with the average daily time spent online is a little over 10 hours in SA, marketers will be benefited to know that 94.6 per cent of the total population access the internet through their mobile phones.
The eCommerce market presents digital marketers with an exciting opportunity for growth in South Africa. It is the 37th largest market globally for eCommerce with an income of $4 billion in 2020 alone. The South African eCommerce market grew by 24 per cent and contributed significantly to the global eCommerce market that grew by 26 per cent.
Revenue is expected to show an annual growth rate (CAGR 2021-2025) of 8.16 per cent, resulting in a projected market volume of $6,305 million by 2025.
When shopping online, customers enjoy shopping when they want, where they want, and pay how they want due to the various payment methods available to online stores. This is something that traditional retail stores find challenging to compete with and online stores use to their advantage.
To accelerate digital commerce in South Africa, research indicates that it will become increasingly important to design offerings that solve specific consumer concerns and use consumer insights to strengthen differentiation. A strong digital commerce offering is not just about having the right technology in place, but marketing as well.
Marketers looking to expand their business have to consider the following questions before strategising to increase consumer engagement and grow their business.
How can shoppers and consumers be won over? What helps to gain their trust?
What makes a customer want a particular brand’s products and not from similar ones? What makes a customer go back to a marketer?
A study by Adobe Magneto about the South African consumer and their behaviour with regards to the eCommerce market found out that customers prefer a brand over another and don’t churn when they get benefits like free delivery, competitive prices, hassle-free returns, delivery in less than a week, and the retailer has a good reputation.
The Magneto report found that customers prefer e-retailers when they offer customers the freedom to make payments through their preferred payment methods. Some of the preferred payment methods for customers include debit cards (preferred by 46 per cent of customers), credit card (preferred by 40 per cent of customers), direct bank transfer (preferred by 38 per cent of customers), e-wallets (preferred by 35 per cent of shoppers) and cash on delivery (preferred by 34 per cent of shoppers).
Also Read: South Africa’s CMOs To Watch
Marketers must remember that the check-out section of an eCommerce website is the most sensitive part of a buying funnel. Marketers can increase the conversion rates of their websites if they are optimised. Considering tourist influx, it’s advisable to design websites and optimise payment options keeping international tourists in mind.
It’s essential for marketers to provide (potential) customers with payment methods of their preference. Not supporting common payment methods in a given market will immediately exclude a certain portion of that market. In many cases, if online shoppers can’t find their preferred or trusted payment method during checkout, they abandon the shopping cart entirely.
In the South African eCommerce market, the number of users is expected to increase to 33.4 million by 2025. The user penetration is expected to be 41.1 per cent in 2021 and is expected to increase to 53.1 per cent by 2025.
For the customer, a marketer’s product is as important as the UI, UX offered by them during the sales process. Take a look at some of the common expectations customers have from eCommerce sellers.
— 58 per cent of electronic shoppers feel that an eCommerce website must be easy to read and navigate.
— 49 per cent of consumers wanted a premium online/in-app experience and enhanced CX.
— 51 per cent of customers said they expect marketers to always have their frequently purchased products in stock.
— 12 per cent of shoppers expect eCommerce apps and websites to be controllable with intelligent voice assistants (IVAs) like Alexa, Siri, or Google.
— 65 per cent of eCommerce shoppers care about their personal data and privacy and consider a marketer’s security credentials before making a purchase.— Internet speed and device compatibility of apps are important factors for consumers as it helps them complete their transactions in a fast and reliable manner. For nearly 49 per cent of customers, how well a marketer modernises their business or uses technology like AI or ML to increase their business efficiency matters.
Feedback is another sure-shot way for marketers to know what’s on their customers’ mind. To be customer-centric requires marketers to know their customers’ pulse, as well as think like them. If a marketer wants to be omnipresent for their customer, adopting an omnichannel engagement and data collection model is the only way to establish and truly understand the connection between customer behaviour, thought, intent, and needs.
Also Read: Is South Africa MarTech Ready?
Best Practices for a successful eCommerce journey in South Africa
| 1 | Learn from the global eCommerce leaders. Retailers don’t have to reinvent the eCommerce wheel. Plenty of “digital-first” companies have already shown the way forward with their customer focus. |
| 2 | The failure to adopt new technologies and new ways of doing business “traps” value.
Retail giants that have been slower to pivot to eCommerce have underperformed compared to their peers. |
| 3 | South Africa’s digital world has advanced in the past few years, so customer intelligence needs to be a part of marketing campaigns if a business wants to succeed and remain competitive. |
| 4 | Address pressing issues. Nearly two-thirds of online buyers say that lack of consistency and limited choice in payment methods is a source of frustration. |
| 5 | With online shopping, evaluation (and re-evaluation) is at the core rather than loyalty. Today’s technology-enabled customers can continuously re-evaluate their options, choosing a provider that is most relevant to them at the moment. |
Personalisation is the key to great CX.
The belief that customers do not want to share any data with marketers is a half-truth. Customers have no problem in sharing their data with marketers as long as that data is used by marketers to personalise products and services, improve product and service offerings. A survey found that almost 24 per cent of South African customers want eCommerce websites to use their profile data to suggest products they might like. 29 per cent of South African consumers want product suggestions based on their purchase history.
Relevant and contextual advertising is another important deciding factor for South African consumers. Almost 31 per cent of consumers say that they will stop using a retailer that suggests the wrong items to them while shopping online. Almost 30 per cent of online shoppers say that they will unsubscribe from a mailing list if they are sent irrelevant information.
It’s imperative for marketers to study and have a clear understanding of the market before doing business or growing an existing business.
Here are the various factors that a marketer must keep in mind to do business in South Africa.
Popular products that are sold online in South Africa include apparel, books, tickets to events and concerts, music and DVDs. Marketers need to know what are the most selling products to understand what’s lacking in the existing setup and increase the value in their offerings.
The top eCommerce sites in South Africa are Amazon, Takealot.com and McAfee. Other top retail sites include BidorBuy, Alibaba, Apple, Pricecheck.co.za, eBay, Makro.co.za and Woolworths. Marketers intending to expand their business in South Africa have to know which site suits the product offered, the volume of traffic on the eCommerce platform, competition and the type of visitors it attracts.
Having a clear understanding of digital marketing best practices and SEO is essential to drive traffic, and grow the business. Businesses grow when they are connected to the people and their culture. It’s imperative that marketers understand and factor in the language preferences of the South African demography. If all regional languages can’t be accommodated, marketers can at least create a regional version of their eCommerce website or platform in Afrikaans besides English.
eCommerce in South Africa presents an exciting growth opportunity for retailers. To accelerate digital commerce in South Africa, research indicates that it will become increasingly important to design offerings that solve specific consumer concerns and use consumer insights to strengthen differentiation. A strong digital commerce offering is not just about having the right technology in place, but marketing as well. Here’s a checklist on selling online in South Africa
- Integrate eCommerce with legacy businesses.
- eCommerce-optimised translation systems help marketers conquer regional language barriers and create a marketplace that welcomes all.
- Build a modern digital infrastructure. Local marketing & SEO are important aspects that have to be taken into account and localised to factor searches in regional languages.
- A marketer has to create the right marketing stacks and ensure an omnichannel approach to collect and process customer data, product data etc. Wherever possible marketer must embrace automation to avoid redundancy or labour-intensive processes.
- Ensure a strategy to have the right mobile marketing channels in place.
- Respect local product restrictions.
- Improve customer trust and experience.
The rapid increase in smartphone use will accelerate the online shopping behaviour in South Africa in the coming future. According to research by Euromonitor International, online sales in South Africa will grow almost three times as fast as in-store sales in the period 2018–2023. South Africans have embraced the use of digital technologies at a rapid rate over the past five years. By 2022, South Africa will have 25.5 million smartphone users10, 19 million Facebook users, while leading retail banks show digital banking is growing fast.
Digitally savvy consumers expect the brands they deal with to be relevant. Retailers have to compete on more than the traditional criteria of convenience, quality and price. They must understand their customers’ preferences, anticipate their needs and provide an excellent experience every time. South African marketers have an opportunity to learn from the successes and failures of global eCommerce leaders. How well they do so, time will tell.
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