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Africa’s ecommerce boom

Africa. The second largest continent on the planet and home to nearly one billion people. Africa is arguably the oldest – and the youngest – continent in the world. Believed to be the birthplace of humanity and the oldest landmass on Earth, Africa is also very young – more than 50 percent of people living in many African states are under the age of 25, and a recent UN population report shows that the African population is expected to more than double over the next three decades, accounting for the highest global population surge.

Africa's ecommerce boom-Expected population increase (Africa's ecommerce boom)

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The UN report also predicts that Nigeria, located in West Africa, will move from the seventh to the third most populous country in the world over the next 30 years, with a population expected to rise to roughly 300 million people. For international ecommerce, this reality is staggering.

Nigeria is home to Africa’s largest economy and over 50 percent of Nigerians are now online

More and more Africans are turning to the Internet to explore a growing number of interests. From accessing travel, news, weather, and music, to managing appointments, playing games, shopping, reading and more, Africans are steadily increasing their use of the World Wide Web.

Nigeria in particular, is home to the continent’s largest economy and the Nigerian government is heavily investing in power generation, transportation, and technology infrastructure. With over 50 percent of Nigerians online, the world is taking notice. Jumia, the largest ecommerce platform in Africa, reported that over 70 percent of their Nigerian visitors use mobile phones, and smartphones are the most popular online shopping device.

Africa's ecommerce boom-Nigerian smart phone usage

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Out of more than 4,500 respondents in Kenya, Morocco, Nigeria, and South Africa, an average of 95 percent of those under the age of 25 reported that their current online device is a mobile phone (mobile + smartphone), and just under 68 percent strictly use a smartphone for online activities. This trend continues among all age groups in all countries surveyed, with an average of 96 percent of respondents reporting that they use mobile phones for their internet activity, while 54 percent strictly use smartphones.

Although online purchasing is still relatively low compared to more mature markets, these percentages are on the rise. Jumia reported USD 149 million in revenue in 2015, and McKinsey’s Global Institute predicts that by 2025, Africans will make annual online purchases worth USD 75 billion.

Language barriers continue to be one of the most challenging aspects of penetrating African ecommerce

Depending on how you look at it, Africa is home to approximately 2,000 living languages which can be categorized into four main linguistic groups:

Afro-Asiatic

Nilo-Saharan

Niger-Saharan

Khoisan

With this amazing linguistic diversity, language barriers continue to be one of the most challenging aspects of penetrating the African ecommerce market. South Africa alone, has 11 official languages and less than 10 percent of South Africans speak English at home.

Language barriers affect how people interact online and can significantly limit engagement. Finding a way that allows people with different languages to access and use the same mobile features poses a serious challenge for developers when focusing on interface development. Software and technology are big business but developing software technology for the African market is complicated. When it comes to coding, developers need to not only keep languages in mind, but they must also consider cultural differences.

Images, layouts, navigation, icons, and content all play a key role in how users will be able to identify with, and successfully use, their mobile device. Developers are beginning to focus more on using succinct, unambiguous content, visual representation, and a variety of dimensions to account for multilinguistic and multicultural designs. The more developers design ways that allow African languages to be incorporated into software and technology, the more African consumers will be able to engage online.

Africa’s technical infrastructure is lagging, but tech startups and big tech investment are paving the future

Although African technology infrastructure is still lagging behind the rest of the world, there have been some impressive advancements in recent years. From fiber optic telecommunications and satellites to undersea wireless fiber infrastructure, more and more Africans are starting to enjoy the benefits of widespread internet access. Nigeria is rapidly becoming the tech-investment hub of Africa with ecommerce startups, digital payment organizations, and more. A growing number of companies are stepping up to provide digital platforms that allow businesses to tap an historically underpenetrated market – and that means greater access to a steadily growing customer base.

Ironically, the lack of infrastructure, while a disadvantage today, is a big advantage in the future. Countries with no existing infrastructure can more quickly adopt new technologies since they are not tied to old infrastructure. A perfect example is Internet streaming video. In America, there are entire infrastructures tied into cable and broadcast media so Americans tend to be set in their ways and are slow to adopt streaming as their primary source of video consumption. Other countries without such existing infrastructure have no such qualms.

Keep your eyes on the prize

No, perhaps African ecommerce is not growing as rapidly as the ecommerce markets of Asian countries or markets in Latin America, but don’t let that fool you. Facebook opened its first permanent African office in 2015, and Amazon and Alibaba are becoming respectable contenders to Africa’s largest ecommerce platform, Jumia. So, keep your eyes on the prize – Africa is a very promising emerging market.

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