According to a recent study conducted by Ipsos, cross-border shopping is a growing trend with around 80% of shoppers going international when purchasing goods online. In Nigeria 47% of the online spend is already taken internationally, while in South Africa shopping across the continent continues to rise in popularity. The two countries are seen to be boosting eCommerce on the continent, offering a much-needed shift that can potentially have a positive impact on both economies.
The Worldpay Global Payments Report 2015 found that the current global eCommerce market was worth around US$1.66 trillion with an expected value of US$2.4 trillion by 2019 – to date, an estimated 23% of this spend has taken place exclusively on a mobile device.
Nigeria, the largest market in Africa, has 147m mobile connections with internet and mobile penetration rates averaging 59%, along with growing internet and mobile users at 82 million and 93 million respectively. South Africa’s internet and mobile penetration stands at around 50%. The Ipsos survey found that 90% of online shoppers owned a smartphone or feature phone and used it to complete their purchases. More than half do so more than once a month.
Currently Nigeria leads the way when it comes to the volumes of online shoppers at 89%, South Africa comes in second at 70% and Kenya in third at 60%. Within these numbers, around one third of Nigerians are using South African online retailers and spending their cash across the borders.
According to PayU Nigeria’s Juliet Nwanguma, as the size of the Nigerian economy and population has grown, so has the volume of electronic transactions. Nigeria’s total payments volume for 2014 was US$222 billion, amounting to more than 526 million payment transactions in total; mobile and web payments equalled roughly 10% of that amount.
As mobile devices deepen their penetration and mobile wallets and payment solutions continue to evolve, consumers across the continent will have an increasingly secure and reliable way of finding the best deals no matter where they may be. For South Africa and Nigeria, it is a step in the right direction and one that has enormous potential for the future of eCommerce and their respective economies.
