Digital Planet explores international online retail trends which would boost the South Africa’s online retail sector.
Neil Watson, CEO at Digital Planet says that online shopping in South Africa as a standalone, is still relatively small. “When it comes to the world of online retail, South Africa is still seen as being in e-commerce infancy but is growing at quite a rapid pace.”
Watson says that the ability for rapid growth is what makes South Africa’s market so exciting.
He points to 4 international retail trends that could work in South Africa to boost the industry.
Smartphones provide the ultimate gateway for internet users across the world. They provide consumers with market transparency and the possibility of anywhere, anytime interaction.
In China, it’s estimated that 88.9% of internet users chose to connect through their mobile phones. A recent study, conducted by the German Scientific Institute of Market Research (GfK), found that 26% of German shoppers compare prices using their mobile devices when visiting a store.
When it comes to South Africa, mobile has also had a significant impact within the market. “Mobile penetration within South Africa is huge and smartphones are quickly gaining market share over feature phones,” said Watson. “Mobile purchasing isn’t big just yet, but consumers are increasingly making use of it.”
Digital currency, particularly Bitcoin, is emerging at quite a rapid pace within the online retail space. However, due to some scandals and security risks, many businesses are still wary of digital currencies. Despite this, there are many different forms of online monetary transactions coming to the fore, such as desktop wallets, mobile wallets and web wallets.
South Africans, have in fact, become far more familiar with the concept of mobile wallets in recent years.
Interestingly, Africa and South Africa are more advanced in mobile payment systems than the US. This is thanks to payment methods such as QR codes or tap to pay, with 55% of South Africans saying they would be willing to use digital currency, according to the 2015 consumer study conducted by PwC.
“Credit card penetration within South Africa is relatively low,” said Watson. “Digital currency could therefore bridge the gap between those who have a credit card and access to the internet versus those who have internet, but no credit card.”
Let’s be honest, not everyone has the time to sit around and wait for their parcel to be delivered. Standard delivery will suit most consumers, with some willing to wait for a longer period of time, in order to get free delivery.
That being said, there are many consumers who wish to have their parcel delivered on the same day. When it comes to delivery, a fixed date is the most popular choice, closely followed by next day delivery.
PwC’s consumer study also found that 79% of South Africans are willing to pay for same-day delivery, which is why it’s important for retailers to have the logistical infrastructure in place to satisfy customers’ needs.
Click and collect
The concept of click and collect is very simple. The consumer will buy something online and collect it in their own time, often just a few hours later, rather than wait for it to be delivered three or four days later. It’s ideal for those consumers who are headed to a particular store but want to save time.
One of the biggest attractions about click and collect is the certainty that your item will actually be there, waiting for you. “This particular trend is very popular within the UK marketplace and it’s something which has the potential to become just as popular in South Africa,” said Watson.
The year ahead
Watson’s advice is that because South Africa is lagging behind the rest of the world in online retail, we have the advantage of having other markets far ahead of our own going through trends before we do.
“It’s like the world is our testing ground,” he said. “So the methods that have been successful across the globe are the ones that South Africa’s retailers should try first. It means a much higher chance of success”.