E-commerce in South Africa is poised for a big leap on the wings of their growth in 2019. With a 13.6 percent y-o-y growth in revenues (USD 3308 Mn), and a 9.2 percent y-o-y growth in consumers (34.7 Mn), Statista estimates the online retail market volume in the country is predicted to touch USD 4.8 Million by 2023 – an annual growth rate of 9.9 percent. The looming question for organisations is how they can manage their end-customers’ preferences. Especially with access opening to a myriad of slick local and global online retail platforms, their expectations keep climbing.
Businesses need to augment their digital capabilities to focus on customer service solutions and margins. If not, they could run the risk of sliding to the tail end of the competitive curve.
Staying Ahead in a Growing Market
The signs of moving to online shopping are apparent. Traditionally, South African retail customers have preferred brick and mortar shopping experiences, but this is changing. According to a recent report by the SA Property Owners Association, the vacancy rate in large shopping malls has tripled since 2013. On the other hand, thanks to the deepening Internet infrastructure across the country, consumers now have greater access to online shopping. With decreasing costs of Internet connectivity, a greater swath of the market can now access online portals.
It is time for e-retailers to pay attention to customer expectations if they want to ride the wave and sustain mature growth in e-commerce. With e-buyers at different points in their buyer’s journey, their purchasing habits will be closely connected to their customer satisfaction levels at every point. Some may be overcoming their first-purchase fear and learning to trust online retailers. Others may have monthly, weekly or even daily goods delivered to their work or home. According to the SA Council of Shopping Centres, the average spend for online consumers has increased from ZAR 1 882 to nearly ZAR 3 400 per month, almost doubling since 2013.
Low barriers to entry will induce many new players to emerge in this growing market. However, if they grow, thrive and remain ahead of the competition, businesses will need to reinvest profits where it counts – in improving customer service and experience.
Since e-commerce customers in South Africa are exposed to local and global competitors with slick, contemporary, UX-friendly apps and websites, their expectations will be high and will continually grow. Businesses need to align with these demanding standards or run the risk of losing customers and potential market share. Retailers who meet and surpass customer expectations in all steps in the complex retail chain will stay ahead in the competition curve.
The Power of Data
CEOs play a vital role in embracing and adopting digital technology. With forward-thinking vision and agile leadership, they can lead their organisations to harness the power of their most precious resource – real-time data. By extracting actionable insights through analytics data mining solutions, businesses can drive customer loyalty.
Enhanced digital capabilities can provide frameworks to improve process efficiencies in Customer Relationship Management (CRM), and Financial Planning and Analysis (FP&A) – and reduce demand-forecasting errors. Additionally, agile applications can enable them to effectively manage their brand’s online social conversations.
Analytics, AI and machine learning are key to boosting customer experiences and satisfaction in e-commerce. Through relevant products and services to customers, they provide hyper-personalisation and a sure way to boost return on investment. With insights gleaned from big data analytics, CEOs can streamline strategic decision-making, and enable their organisations to respond quickly to trends. In addition, they can optimise marketing and customer service for their online platform.
E-commerce is here to stay and grow. Players in the arena will need to astutely leverage the potential by placing people over products. They will need to direct their strategy towards extreme customer-centricity and operationalise intelligently through data-driven technologies and analytics.