The global e-commerce retail revenues are projected to hit $6.54 trillion by 2023 as against worldwide e-commerce sales of $5.53 trillion in 2019, a report by Statista has revealed.
A report titled ‘‘2020: E-Commerce Trends that Will Redefine the Sector’’, made available by Jumia, disclosed that players in the sector will profit from the various trends, which are potent to transform the e-commerce sector in Nigeria into a profit-making venture.
‘‘With the current outlook for 2020, the market is growing rapidly and there are changes that will help businesses grow while there are also new challenges that some businesses may possibly not keep up with.
According to the 2019 Jumia mobile report, 85 per cent of the Nigerian consumers on the platform shopped via their mobile devices; that is via mobile web and the Jumia mobile App.
This, according to GSMA 2019, is rather unsurprising because at the end of 2018, there were over five billion unique mobile subscribers across the globe, and 60 per cent of the connection was through mobile devices. The GSMA report puts the peak of internet users at 3.6 billion.
‘‘Locally, there were over 172 million Nigerians (87 per cent penetration of the Nigerian population) who had access to mobile devices, whereas only 112 million Nigerians had access to the internet. While the number of mobile/smartphone users might have increased year-on-year, its penetration is still very insignificant.
Internet connectivity and the availability of affordable smartphones continue to drive an increasing uptake of mobile shopping. The year 2020 will witness the entrance of new, affordable mobile devices and, the government’s efforts to expand the reach of the internet through the various mobile operators will further drive increased mobile shopping.’’
The survey predicts that Fintech will overtake payment on delivery, adding that, while most online shoppers in Nigeria still prefer payment on delivery, this is expected to reduce drastically by the end of 2020 because the rise of Fintech is changing the narrative as more and more online shoppers are starting to develop trust in online payment.
Another report by Jumia shows that this development will grow bigger in 2020. According to the Jumia Q3 financial report 2019, over 30 per cent of the transactions on Jumia was done through JumiaPay, its payment platform. It explains that over a year ago, payment on delivery was the preferred option for most consumers. This, it says is an indication that the trust issues around security and safety of consumers’ data and money are clearly disappearing gradually, adding that predictions have shown that the company’s payment platform might become its cash cow in years to come. More SMEs and big brands will leverage e-commerce to drive growth
The Jumia report notes that as businesses expand beyond their local markets, both big, small and medium-size businesses are expected to leverage e-commerce for growth in 2020.
It stated that big and small businesses will increase the use of e-commerce to boost conversion, create a personalized customer experience, use data for deeper insights, cross-sell to existing customers and leverage discounts to increase sales.
The development will also extend logistics services to third party ensuring fast and on-time delivery of products to customers will continue to play a major role in e-commerce.
‘‘However, to address infrastructure challenges such as logistics, large network of leased warehouses, pick up stations for customers and drop off points for merchants will form a trend in 2020.