The eCommerce Struggle: Will Nigeria Survive?

From online orders to online store merchants, from logistics to pay on delivery; the eCommerce Scene in Nigeria is experiencing difficult times.

Only days ago, Zinox Technologies announced that they have acquired top Nigerian eCommerce player KONGA.

Nobody saw this coming in any way; bearing in mind the fact that eCommerce started with a big bang on the Nigerian market; now, Konga has been sold for a rumored mediocre amount of money compared to its value (something you’ll call a distress sale). Jumia isn’t left out, they are struggling even Yudala can’t authoritatively boast of dominance and sustainable profit.

What then could be the problem?

Honestly, I could list a couple of issues individuals have experienced when buying stuffs online, here in Nigeria.

From delivering sub-standard products (merchants fault in most cases though) to other delivery issues; even sometimes pricing can be overboard

There are just load of issues with eCommerce in Nigeria

But for me, I think it boils down to two things

  1. Culture
  2. Organization

I’m saying Culture and Organization because the Nigerian market is quite unique; it’s not the same as China, the United States or even South Africa here.

Amazon

We are a bit more complicated. Companies like Amazon, Ali express have the same (or at least a close) selling strategy with Jumia, Konga and the likes. In-fact I’ve seen cases of Ali express sending a substandard/wrong product to people; but then, they are very well organized (very effective and efficient refund system), you’ll get your money back in no time.

In this scenario, the typical Nigerian doesn’t “trust” easily; and it’s telling a lot on some of these companies. (truth is; In some cases, they are right not trust a system that is not organized).   

Feature such as

Pay on Delivery

Payment on Delivery, has caused more harm. Konga had to stop it (even though, there was a decrease in ordering, there was a significant increase in the number of products and items that were delivered successfully); Here, you see that the culture is not making things easy.

Nigerians would place an order online only to cancel when the delivery man is outside (they then give flimsy excuses, when the truth is that they don’t have money). In fact, sometimes, it gets to the extreme, remember the case of the Jumia delivery man that was killed because those who placed the other wanted to steal from him.

The case study is quite simple “most Nigerians want pay on delivery because they don’t trust the system (a system showing one thing and bringing another; again, the culture thing is telling because they don’t know if the refund will come; at least on time), and the online stores on their part believe payment on delivery is costing them too much.    

So, a well-organized payment on delivery system could do much; but it isn’t a badass solution.

Any Survival Chances?

In a nutshell, YES……. We stand a chance, a chance to making eCommerce in Nigeria great again. For all the “Negative” feedbacks from Zinox Technologies purchase of Konga; this move could be everything eCommerce in Nigeria needs.

Lots of these online stores; Jumia, Konga, Yudala, Payporte and the likes spend a lot on advertising. Payporte for example spends heavily on Big Brother Naija, Yudala is always having one concert or the other, the list goes on.

All of these things are awesome, but the same effort should be put into strategizing and organizing. If you need to have mini stores/ware houses/deports across major cities to ease pay on delivery please do have them.

It shouldn’t be advertising alone!!!

Investors certainly have got roles to play; the eCommerce niche is wide enough, but have eCommerce newbies got enough backing from investors?

Upcoming online stores are most certainly in a state of panic right about now, and the question is “if these eCommerce giants are struggling, what chance do we stand “?

Call it a million-dollar question; only time can tell the answer… keep your fingers crossed.

However, we won’t stop being optimistic about the future; majority of the internet companies in Nigeria (most especially those in the eCommerce Niche) is undergoing growth.

We hope the top players can leave failure behind, strategize and forge ahead. We also hope the newcomers can sit, watch and learn from the mistakes of the top players.

Overall we also hope that everyone gets a conducive environment and tools needed to ensure eCommerce not only thrives in Nigeria but Africa as a whole.