How COVID-19 is transforming the e-commerce landscape in Africa and Mauritius

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The outbreak of COVID-19 has brought to the fore the path-breaking role of e-commerce as consumers across Africa rely on it to access essential products. There has never been another period in Africa’s history in which e-commerce has been so indispensable to vast populations across the continent, which boasts over 1.3 billion people and around 526 million internet users[1].

Indeed, it is now becoming increasingly hard to imagine that the whole of Africa had only 21 million online shoppers in 2017[2]. The e-commerce landscape looks poised for unprecedented growth as online shopping solutions have come to the rescue of millions of people on the continent amid social distancing measures and lockdowns enforced across African economies.

By helping consumers to shop and pay for essential products in a safe space and have them delivered to their doorstep, e-commerce has proved its worth in a time of utmost crisis.

Barriers to the growth of e-commerce in Africa

A report by Fitch Solutions[3] notes that the e-commerce market in Sub-Saharan Africa is relatively underdeveloped when compared to elsewhere in the world, with many households not offering a high enough level of disposable income to support the e-commerce market.

There are also a number of operational obstacles that have hampered e-commerce expansion in the region, with payments in particular proving a barrier to development as cash on delivery is deeply rooted in consumer behaviour in Africa.

On the positive side, mobile money is now more commonplace, so digital payments are becoming less of an obstacle for e-commerce development. Large payments are, however, still effected in cash, owing to the limitations of digital wallets and also consumers’ preference for inspecting high-value goods before committing to large payments. This necessarily implies that some segments of e-commerce, such as big-ticket items like furniture and consumer electronics, for instance, will take longer to develop in Africa than in other parts of the world.

Even more worryingly, the UNCTAD’s B2C e-commerce Index 2018: Focus on Africa[4] report notes that the region lags behind the rest of the world in terms of e-commerce readiness. Mauritius – with a global ranking of 55 – is the highest ranked African country, and as many as nine of the ten countries at the bottom of the 151-nation index are in Africa.

Silver linings in e-commerce readiness in Africa

However, the report still holds out a ray of hope in that the continent is showing significant progress in key indicators related to B2C e-commerce. Since 2014, Sub-Saharan Africa has surpassed global growth on three of the indicators used in the index – ownership of e-commerce accounts, internet users, and secure internet servers.

The report notes that each of the top three African countries has a distinctive strength in one of the four core areas measured by the index. Highest ranked Mauritius has a considerable 13-point lead over the next African country and scores particularly well with regard to the share of the population having an e-commerce account – a whopping 90%. In an effort to get more SMEs online, the government launched a shopping portal in 2018 offering tax-free purchases – a far-sighted move that has paid off handsomely in propelling Mauritius to the top of the index.

Nigeria, which is not only the largest African economy but also its biggest e-commerce marketplace, ranks second, largely thanks to a significant increase in postal reliability as measured by the Universal Postal Union (UPU). As Africa’s largest B2C e-commerce market in terms of both number of shoppers and e-commerce revenues, reliable delivery of products is an area of clear focus for the dynamic economy.

Finally, third-ranked South Africa leads by some margin in the number of secure internet servers per one million people, an indication of websites accepting online sales and payments. Local online shopping sites such as Bidorbuy and Takealot dominate the B2C market and are backed by local and international venture capital investment. Payments are facilitated with instant transfers through bank accounts and several domestic digital wallets.

All these trends are only set to intensify in a COVID-19 context as the prohibition of non-essential retail within the bricks and mortar segment forces many consumer-facing firms to expand or break into e-commerce.

Pockets of e-commerce accelerating in a COVID-19 context

In terms of product focus, e-commerce demand during the lockdown period has been seen to overwhelmingly favour priority purchases encompassing groceries, healthcare and self-grooming products, as consumers practice social distancing to the best of their ability. In addition, reduced movement of vehicles in a lockdown context also means that essential deliveries can happen much faster in cities otherwise notorious for traffic jams. 

To give just a few instances of how the e-commerce market in Africa has expanded since COVID-19, pan-African payments major Flutterwave now offers an e-commerce portal that allows merchants to set up online shops for whom the FinTech giant will drive payments, giving SMEs across Africa a new lease on life.

In Kenya, Africa’s most vibrant economy, Twiga Foods, a marketplace which supplies retailers with fresh produce from farms, has partnered with pan-African e-commerce major Jumia to widen its reach, allowing many more households to order and receive food items without having to visit supermarkets and risk virus transmission in the process.

Not to be left behind, Nigeria’s agri-tech platform FarmCrowdy that allows people to invest in existing farms for a share of profits, has launched an e-commerce platform called FarmCrowdy Foods. Through the food platform, Farmcrowdy collects produce from its network of more than 25,000 farmers situated in the rural north of the country, before transporting it to storage facilities near Lagos, where there is most demand.

Meanwhile, Mauritius has also seen a proliferation of e-commerce solutions as the economy enforced one of the most stringent lockdowns globally, seeing supermarkets completely closed for two weeks and forcing digital platforms to come to the rescue like never before. While existing e-commerce platforms such as and have seen a spurt in usage and online payments in the face of the pandemic, new and innovative platforms – such as the Moris.Store that provides a virtual front to diverse SME retail outlets – have also emerged in response to the pressing need.

Will e-commerce continue to grow in the post-COVID era?

In the immediate aftermath of the lockdown, consumers are still expected to avoid crowded areas, such as shopping centers and open air markets, and so the demand factors for continuing consumer interaction with e-commerce are likely to remain in place. A longer term impact can also be expected, as a greater segment of African consumers experience e-commerce, become more confident with it, and recognise the convenience it offers.

However, all is not smooth sailing for the growth of e-commerce in Africa. Supply chain disruptions could yet result in an inability to fulfill orders, especially in countries with strict lockdown measures. For instance, e-commerce platforms are being forced to suspend delivery of non-essential items to consumers in key African economies such as South Africa[5] as they reel under strict lockdowns. E-commerce platforms are also faced with challenges in fulfilling orders for imported products sourced from locations where airspaces are closed.

Finally, there are also concerns over the sustainability of several e-commerce ventures that are showing a heavy reliance on groceries as an anchor for sales, amid questions over the viability of such a model once lockdowns are lifted across countries.  

Why Africa must champion the cause of e-commerce

During the pandemic, e-commerce solutions have played a significant role in ensuring business continuity for many companies by serving as a crucial channel for providing vital goods and services. Indeed, for many SMEs in Africa, e-commerce has offered a lifeline and can continue to play a key role in their economic recovery.

Indeed, the various players championing this cause, such as , Mycart and Moris Store, among others, are holding out a lifeline for SMEs by allowing them to continue selling their products and services online.

With forecasts that e-commerce sales will reach 17.5 percent of retail sales worldwide by 2021[6] amid the evolving new normal, analysts believe that e-commerce platforms offer unlimited potential to serve as the engine powering the logistics value chain and accelerating the FinTech revolution in Africa.