E-commerce makes strong resurgence in Nigeria

The future is bright

E-commerce has the ability to propel Nigeria into the ranks of the fastest growing economies in the world. A recent study undertaken by the Terragon Group has shown that by June 2014 almost two in three Nigerian internet users had purchased at least one item online, with over 2m Nigerians regularly using the top two online retailers, Konga and Jumia, in 2014. These figures are a positive sign and indicate the need to encourage the remaining Nigerians who have not bought online to try a new shopping experience and to ensure that customers who have used online retail in the past continue to do so in the future.

The major problems that need to be solved if Nigeria is to adopt e-commerce as a part of everyday life include the infrastructure issues, online payment security, technological innovation and ease of use. The good news is that there are many new e-commerce payment platforms, such as the partnership between the United Bank of Africa and Ixaris, which will offer a pre-paid card option for online payments. A future trend that is set to become an important aspect of the e-commerce market is how significant social media will be in terms of allowing customers to review products and share their experiences of shopping with a particular company. Over 85% of young Nigerians have a Facebook account.

In the medium term, the effects that e-commerce is expected to have in Nigeria will be nothing short of transformational. From the creation of new, skilled jobs to the increased product selection and making shopping so much more convenient, ordinary
Nigerians will surely be the biggest beneficiaries of the e-commerce revolution.

One of other more unusual reasons for the recent success of Nigerian e-commerce has been the fear of contracting Ebola. The concern of mixing with large groups of people in supermarkets and shops has led to a growth spurt in e-commerce purchases, with sanitation and cleaning products being the main beneficiaries.

The use of online shopping may have played a small part in restricting the spread of Ebola in Nigeria, as there is a reduced risk of human-to-human transmission

The impact on neighbouring countries will also be significant as the internet can be a major unifying force with a more interconnected Africa being expected in the future.

There are many positive trends that are expected to further boost the e-commerce sector, such as Nigeria’s growing middle class and the consequent rise in the demand for luxury goods. Nigeria’s population is expected to grow to over 440m by 2050, greater than the population estimate for the US, at just under 400m. Thanks to the e-commerce revolution, Nigerian consumers will soon be able to take their pick of products from countries around the world and open up untapped markets for small and large businesses in Nigeria.