E-Commerce continues to shape business A survey by Effective Measure and Visa reveals that more consumers are becoming digitally active. We look at what this means for business.
more consumers are adopting online platforms for their shopping, according to a study by Effective Measure (EM) and Visa. Findings from the EM e-Commerce Industry Report 2016 reveal that of the 12 000 people surveyed, 56% of respondents shop online.
The survey is useful in helping businesses understand who online users are and then tailor their product offerings accordingly. It can also help them understand who their offline users are, and how to draw these consumers to become more active in online shopping, explains Nicolle Harding, EM lead for sub-Saharan Africa.
Some of the findings show that consumers will shop online more if there was free or cheaper delivery, reliable payment methods and easy return policies. Users also prefer to shop online to save time, access online product reviews, compare prices and receive special offers. The report also shows that consumers preferred purchasing books, DVDs, music, event and travel tickets, as well as making hotel reservations, online.
When it comes to trust, online shoppers are concerned about the platforms they use to make the purchase, with 59% preferring to use a desktop to shop online. Offline users prefer to touch the products that they are buying, and do not necessarily trust the website, explains Harding.
It is evident that e-commerce is becoming an integral part of daily life. Although not all consumers shop online, they are digitally active without even realising it, says Geraldine Mitchley, head of emerging products and innovation for Visa in sub-Saharan Africa.
Businesses need to recognise the proliferation of e-commerce and then adapt to make the most of the opportunities that come with it. “We are becoming a mobile first continent…businesses need to anticipate this.”
The following four trends are emerging in business:
Entry of digital powerhouses into payments. “Everything that can potentially be digitised will be digitised,” explains Mitchley. The introduction of digital powerhouses is turning entire industries around, and not just the retail and financial sectors. Uber disrupted the entire transport industry, for example. “It’s the biggest transport company in the world, and all it is, is a piece of software,” she adds.
More content is becoming digitised and mobile and smartphone penetration across all LSM groups is contributing to these changes, explains Mitchley. “There’s enough technology built in phones to allow us [businesses] to service customers in very different ways than what we did in the past.”
More retailers – like Woolworths, Mr Price and Pick n Pay – have recognised the power of e-commerce and have developed apps to engage with consumers on a digital level. Equally, governments and Information Communications Technology (ICT) sectors are working to make these digital environments more accessible, she says.
Shift from plastic to smartphones and smart devices. “Today, you can leave home without your wallet, but you can’t leave home without your phone,” says Mitchley. More and more utilities are being served on our phones. With technology evolving, all payments previously completed using cards can now be completed via the cloud. As we move from using plastic cards to smartphones, payment platforms such as Samsung Pay and Apple Pay are coming to the fore. The details of a card can now be digitised on a smartphone. Offline users can now make payments by simply tapping their phones at the point of sale, or by using their fingerprints when paying online, she explains. “The credit card was not designed for the internet,” says Mitchley. Banks are now starting to issue contactless cards, where payments can be made with a tap, and not the traditional swipe. Payments with smartphones work similarly.
“Today, you can leave home without your wallet, but you can’t leave home without your phone.”
Drive to create an effortless consumer experience will blur lines between face-to-face and remote commerce. e-Commerce is providing an opportunity to engage with customers in interesting ways. A consumer can pay their taxi driver with their phone, in a face-to-face environment, making it an e-commerce transaction. Consumers browsing product offerings on a smart device are actually still using a form of e-commerce, says Mitchley.
Businesses should work to find ways to make online transactions “frictionless”. Shopping online is very cumbersome. “To shop on mobile you need three hands, one to hold the phone, one to fill in forms and one to grab the credit card.” Voice-enabled wireless speaker, Amazon Echo, for example makes the online experience simpler with its “one-click” experience, says Mitchley. Rapid growth of peer-to-peer sharing economy.
e-Commerce is becoming an integral part of daily life.
Nicolle Harding Effective Measure lead for sub-Saharan Africa