Get a demo Do I subscribe? News sign-up
Print

Nigerian ecommerce faces hurdles

News, 25 August 2015

LAGOS: Trust and convenience are the drivers behind the huge growth of ecommerce in Nigeria, but high internet costs and poor infrastructure are limiting its potential, one of the country's leading digital innovators has said.

Speaking to the Daily Times, Raphael Afaedor said there had been significant progress over the last few years, but ecommerce growth is being hindered by longstanding problems with poor roads, telecommunication networks and an unsteady power supply.

Afaedor is well-placed to speak with authority because he is the former co-founder of Jumia, Nigeria's largest online retailer, and currently the co-founder and CEO of rival online marketplace, Supermart.ng.

"It will be a welcome development if the government can make strategic plans and policies to check these infrastructures and ensure that they are in place in order to aid not just ecommerce business but businesses generally," he said, while recognising that the security situation has to be its top priority.

In the meantime, he called on all organisations to think creatively and work around these infrastructure challenges to ensure they deliver for their customers.

There are great opportunities for those businesses able to do so because Nigerians have become much more trusting about the ecommerce option.

Nigerian consumers gained confidence in ecommerce ventures because they were able to pay on delivery, he said, but increasing numbers are now willing to pay in advance.

"At Supermart.ng, for instance, there is a system in place that customers can trust to deliver their groceries to them within three hours without any hitch so they pay online before deliver, not after delivery," he said.

This growing consumer confidence in ecommerce, as well as the convenience that online shopping offers, has helped the sector to grow at an estimated 25% a year.

He went on to point to a recent report from the Ministry of Communications Technology that disclosed ecommerce in Nigeria was worth just $35m in 2012, but it is now valued at $550m and has the potential of $13bn if it is harnessed well.

Data sourced from Daily Times; additional content by Warc staff