Recent reports indicate that online shopping in South Africa is in a strong position. The Narrative 2018 South Africa E-Commerce Report found that 73% of online shoppers say that they have either maintained or increased their online shopping habit in the last 12 months. And according to the World Wide Worx Online Retail in South Africa 2019 Report, local online retail sales were set to pass the R14-billion mark by the end of December 2018.
The recent Black Friday sales onslaught echoed these findings, with the Rand value from sales growing by more than 1 000% over 2016 figures. Even better, the completed transactions on the day increased by close to 700% over 2016 – a 130% increase on 2017’s completed transactions.
World Wide Worx says the 25% overall growth in 2018 was a surprise, given predictions that the online market would slow down.
Two factors behind 2018’s growth are improved mobile speeds and the ubiquity of mobile devices. An OpenSignal study found that the average mobile network speed in South Africa has increased by 5.7Mbps from ten years ago. And given that there were 16.42 million smartphone users in the country in 2016 versus an estimated 20.3 million last year, the opportunities to be had are clear – retailers need a strong online presence or risk losing out to competitors.
Contrary to popular opinion, online shopping is not the exclusive domain of young people. The Narrative Report found that 22% of online shoppers are older than 60 and 44% are female. Retailers marketing and selling products online need to take this into account in their planning and strategies.
But traditional ways of reaching out to shoppers are no longer sufficient – almost a quarter (22%) of online shoppers use social media to help guide their purchases. Word of mouth and feedback from users are therefore critically important to improving the shopping experience. If a retailer is unable to effectively fulfil an order or to provide a reliable payment method when traditional ones go offline, as seen during Black Friday, people will talk about it on social networking sites. In this highly competitive environment, this negative publicity can significantly impact your bottom-line.
It is therefore important for e-tailers to ensure they have the systems in place to make the shopping experience a smooth one. Investing back into the site to embrace innovative technologies and keep it aligned to current market trends is vital. Yet, this does not always happen.
World Wide Worx research shows that only one in five companies surveyed invested more than 20% of their online turnover back into their online store, with over half re-investing less than 10%. Given that 75% of respondents regarded customer service as highly significant, the risk of not properly developing the online business is clear.
Open to alternatives
This is where the likes of alternative digital payments such as instant EFT become critically important. According to the Narrative Report, there is still a lack of trust in online payment methods which deters many potential shoppers. Having a trusted payment method is vital to set people’s minds at ease that their personal information will remain safe.
Once shoppers realise the advantages of an instant EFT payment option, they will embrace it over more traditional methods such as credit or debit cards. Not having to register for the service, not requiring a credit or debit card, and being significantly more secure, reliable and faster than other online payment methods make instant EFT the online shopping way of the future. Retailers who had the system in place during Black Friday benefited significantly when other payment systems went down. And for consumers, the ability to transact and complete their orders meant they will likely return to those sites.