2024 will see a hive of ecommerce activity in SA

by Justin Dennis: Global Digital Commerce Head at Smollan.
The more developed regions such as Europe, Asia and the US, whilst still showing great growth, are seeing increased pressure in ecommerce. The global slowdown in VC spending, closure or consolidation of many grocery delivery services, or the job cuts experienced in Lazada (Alibaba owned) show a natural correction. The drivers of this change are a normal evolution within the market, experienced in most sectors during high-growth phases. The benefit of this is that South Africa has the opportunity to learn from the challenges and implement necessary changes.

In South Africa we expect to see a continuation in investment and high sector growth. With Amazon confirming their launch in 2024, Walmart pushing their ecom capabilities through Massmart, and the local grocery retailers fighting hard to entrench and grow themselves, the sector will be a hive of activity. The benefit of this investment, focus and competition will be a better product and service for the end consumer.

With the aforementioned factors, we expect there will be an increased need by businesses and sellers to service the platforms better. From managing listings, cataloguing, enhanced content, to having an ecommerce strategy as a part of their trade plan – all this will drive the sector forward. We expect a heightened need for improved content to better differentiate products. Data will become increasingly important, as brands and retailers seek to better track and understand online execution. This in turn will increase the need for better tools and systems to manage accordingly.

Looking a little further, over the next few years we expect to see the rise of retail media, increased importance driving digital B2B. Retailers will look to further monetise their platforms and gain greater share of retail and media spend.

Whilst physical retail will continue to hold the majority share of sales, ecommerce is here to stay. Its significant growth will continue to drive its participation up as a key revenue stream for businesses, requiring greater attention and investment. Whether it’s a Marketplace, D2C or through a Retailers platform, a strategy is no longer a nice to have, but rather a need to.

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