E-Commerce Report
Our lives have changed tremendously with the advent of the Internet over the past 20 years. Our habits, expectations and lifestyles have all been altered, and the Internet continues to greatly impact our lives. The various Internet platforms have brought about numerous opportunities for rapid growth and development. Today we continue to embrace new ideas like e-governance, e-learning, e-banking, and e-commerce.
E-commerce has become a phenomenon over the last decade and has been embraced the world over. The advent of companies such as eBay and Amazon in 1994 paved the way for e-commerce growth and advancement. E-Commerce has become an important tool for small and large businesses worldwide, not only to sell to customers, but also to engage them. According to e-marketer, ecommerce sales topped $1 trillion for the first time in history in 2012.
Although the emergence of e-commerce in Africa started just a few years ago, it has come a long way. Nigeria is gradually increasing its use of the Internet as a medium for purchasing and marketing goods and services. Online retail stores are increasingly gaining patronage from individuals and businesses and many companies in the country now use the Internet as a platform to advertise and sell their products and services. Due to these developments, the e-commerce industry in Nigeria has experienced growth.
E-Commerce in Nigeria
Nigeria’s large population coupled with the rapid spread of Internet-enabled mobile phones and the growing access to broadband makes the country’s e-commerce market one of the most attractive in the African continent. According to the former Minister of Communication Technology, Dr. Omobola Johnson, Nigeria’s electronic commerce market has a potential worth of $10 billion. She stated that the e-commerce market in Nigeria has attracted over $200 million in foreign investment with about 36% of the country’s 180 million people connected online. She also revealed that the e-commerce market has created over 12,000 jobs since 2012, expanding the infrastructure, warehousing, advertising and logistics services industry. According to Mobile Media Info Tech, Nigeria recorded over $2 million worth of online transactions per week in 2014.
Though the e-commerce market has been projected to grow at 25% annually, the current economic situation has resulted in a decline in patronage of e-commerce platforms. According to techpoint.ng, web traffic on the major e-commerce sites in Nigeria is at an all-time low. Konga fell 113 places in global web ranking during the first three months of 2016. Jumia Nigeria fell by 183. Although Kaymu’s web traffic grew, bounce rate grew by 44%, daily page views per visitor fell by 22.5%, while daily time spent on site went down by 21%. This has resulted in layoffs across the different platforms. The decline in performance can be attributed to the current economic situation, which has resulted in a decrease in the disposable income available to citizens. It is believed that once the economic situation improves then good times will be back again for the e-commerce platforms. This just shows that e-commerce is a long-term game. Like eBay and Amazon have shown us, only those who have staying power will succeed.
The Nigerian e-commerce industry is still relatively young, so it is not surprising that majority of the e-commerce platforms are in the commercial capital of the country. A report by Kaymu on e-commerce in Nigeria shows that Lagos has the highest number of e-commerce visits. Over 86% of total visits to e-commerce sites come from Lagos, while a distant 2nd is Abuja, the Federal Capital Territory with 9%. Based on research conducted, Nigerian males prefer to shop online compared to females with 59% of e-commerce customers being male and 41% being female. The report also showed that about 69% of online shoppers are between 18 and 34. The data shows that the youth are more interested in buying online than any other group. 18% of shoppers are between the ages of 35 and 44 and 11% of shoppers fall into the 45-64 age group. People older than 65 were found to be less interested in shopping online.
