Amid a growing digital landscape characterised by increased Internet connectivity and smartphone use, as well as a pronounced shift towards online shopping, the South African e-commerce sector is undergoing significant development. In fact, it is projected to exceed R400-billion in value by 2025, driven by an anticipated one-billion-plus transactions a year, says Accenture sales and commerce lead for Africa Mushambi Mutuma.
As of 2023, almost 44-million South Africans were connected to the Internet, compared with 25-million in 2013. Mutuma says this surge has directly fuelled the growth of e-commerce users, with projections suggesting a further increase to 37.9-million by 2027.
In this regard, he says several notable trends and innovations are reshaping the local e-commerce landscape, arguing that the seamless integration of financial technologies and digital payments is enhancing customer experiences and conversion rates.
Supermarket chains have also embraced online platforms and delivery services, with online grocery delivery platform Checkers Sixty60, offered by retailer Checkers, registering a 63.1% increase in sales for the six months ended December 2023.
Mutuma adds that major retail chains, such as Shoprite, Pick n Pay, Woolworths, and Spar, are also dominating in this scale-up, with online sales rapidly gaining traction and expected to account for 5.7% of the retail market by 2027, tripling from pre-pandemic levels.
Amazon, Shein and Temu have also entered the market, demonstrating the extent of future demand that global entities foresee in South Africa.
“Our research into Amazon’s market entry globally shows that when it enters a market there is upside for all parties, even its close competitors.
“We expect the next two to five years to be an exponential proof point of that, driving new consumer conversions and increased market growth. Businesses are likely to focus on integrating advanced technologies, enhancing customer experiences and optimising supply chains to capitalise on this growth.”
Mutuma adds that the industry is also witnessing a rise in personalised, life-centric customer experiences, supported by advancements in AI and data analytics.
“Essentially, pricing, offerings, service and experience are all growing in favour of the customer as more players invest to stand out. Innovations in last-mile delivery and fulfilment services are further bolstering the growth and efficiency of e-commerce operations. The customer will continue to win and benefit.”