Fierce Competition in the South African E-Commerce Sector
Takealot’s Response to Amazon’s Entry
Amazon Integrates AI Features into its Platform
“We look forward to launching Amazon.co.za in South Africa, providing local sellers, brand owners, and entrepreneurs—small and large—the opportunity to grow their business with Amazon, and delivering great value and a convenient shopping experience for customers across South Africa,” said Robert Koen, general manager of the Sub-Saharan Africa region for Amazon.
Targeting Underserved Businesses in South African Rural Areas
Amazon has also been actively targeting the underserved communities in South Africa, to help businesses in rural areas gain a broader reach and grow their businesses effectively.
Johannesburg-based African Mamas Crafts employs home-based crafters in rural areas and sees opportunity to grow their small business in the Amazon store.
Excitement from Local Amazon Merchants
“African Mamas is very excited at the prospect of working with Amazon locally to leverage their tools and expertise to grow our ecommerce business. We cannot wait to embark on this journey of growth,” said Nomaswazi Tinus, founder and director of African Mamas Crafts.
Another business looking forward to the launch is Reader’s Warehouse, created by two brothers who grew up with a passion for books and reading. Sean Bulpin, director at Reader’s Warehouse, said “I am absolutely thrilled about the opportunity to partner with Amazon and sell in their store.
This presents an incredible chance to expand our ecommerce business and tap into a broader customer base in South Africa.”
Significant Growth in Ecommerce
This move from Amazon comes at no surprise as South Africa rapidly makes its transition, despite infrastructure and connectivity set backs, into a digital economy.
According to The International Trade Administration of South Africa, online sales have increased by 66% from 2019 to 2020 to more than $1.8 billion or ZAR30 billion.
South Africa is the 51st largest market for eCommerce with a predicted revenue of US$4,046.8 million by 2023. Revenue is expected to show a compound annual growth rate of 5.2%, resulting in a projected market volume of US$4,961.6 million by 2027.
With an expected increase of 12.9% in 2023, the South African eCommerce market contributed to the worldwide growth rate of 8.7% in 2023, this is according to research conducted by ECDB.