Africa may still be lagging behind the rest of the world in terms of e-commerce penetration and adoption, but the corporate sector is increasingly keen on taking advantage of the benefits of online systems. This is particularly so in the travel sector, where more than half of companies surveyed currently book online and another 20% are expected to do so in the near future.
These results are contained in the independent research paper A Digital Savannah: Africa’s e-commerce promise that was released today. The study was authored by Arthur Goldstuck, CEO of World Wide Worx, and is the first in-depth look at trends and opportunities in the e-commerce space in Africa.
The white paper identifies five key trends shaping decision making and consumer behaviour as they relate to online shopping preferences and travel booking.
The major trend identified is a healthy appetite for online shopping, although the way it is conducted tends to differ significantly from traditional e-commerce systems. For example, Nigerian online retailer Jumia has embraced the payment on delivery philosophy whereby shoppers buy their goods online, but only pay when they are delivered.
The second major finding is that Africa is anything but a homogenous market. Regional and country-specific solutions cannot be applied uniformly in other markets and simply be expected to succeed.
The mobile phone, however, is one constant across all territories, with the third trend pointing to growing adoption of mobile-based payment and banking systems. Not surprisingly, this is being led by the mobile networks that have the physical infrastructure and access to millions of customers who are increasingly reliant on these operators.
The fourth revelation is that more than half of companies surveyed have a significant international and cross-border business footprint. As many as 52% of companies prefer to handle such travel bookings online, which is expected to grow to around 70%.
Payment methods for online travel also vary considerably although credit card payments (45%) and electronic funds transfer (43%) are the most commonly used.
One of the most telling findings of the research is that as many as 83% of companies centralise their travel procurement, although only 66% use travel agencies.
Lastly, corporate travel in Africa tends toward centralised booking, with more than 80% of respondents reporting strict policies and control over travel.
A Digital Savannah: Africa’s e-commerce promise white paper concludes that despite the disparate preferences, environments and available infrastructure across the different countries the overall potential for e-commerce is strong. The common theme of ‘Africa is not a country’ is advice well heeded as clearly no one solution suits all countries, consumers or companies.
We welcome you to download the full A Digital Savannah: Africa’s e-commerce promise and invite any feedback you may have.