While the number of e-tailers is growing in South Africa, there are still a number of hurdles that need to be overcome before these companies can start enjoying sustainable returns, writes KEVIN TUCKER, CEO of PriceCheck.
This year, online retail in South Africa will reach 1% of overall retail for the first time. While the number appears small, it marks a significant milestone for a sector that is attracting robust investment from both established and new players in the retail game. It underscores that online retail is now gathering momentum in South Africa, having maintained a growth rate of above 20% for several years, according to the World Wide Worx Online Retail in South Africa 2016 report. The report revealed that in 2015, the rate of growth was 26%, taking online retail to the R7.5 billion mark. This year, growth in Rand terms is expected to remain the same as in 2015, taking the total to above R9 billion.
However, while these figures are encouraging for the country’s growing number of e-tailers, payment gateways and online merchants, there are undoubtedly still many hurdles to overcome before they can enjoy sustainable returns. Compared to traditional retail, the profits are still paltry and the number of online shoppers spending regularly remains low. The majority of South Africans spend between R250 and R1000 when making a purchase online, and 33% of those surveyed made 10 or more purchases online per year.*
Limited Range, Limited Appeal
The most commonly cited challenge for local online retail is that South Africans remain hesitant to transact online, and are afraid to hand their banking details to payment gateways plagued by fraud.
Although online security is indeed a factor, it is less of an issue than the quality of what South Africans are presented with online. Indeed, the primary challenge is in fact the dearth of innovative business models and – as a direct result – the availability of products online (or the lack thereof).
As several reports have illustrated, most local e-tailers – both established names and newcomers – have a very limited range of products listed online, which deters potential customers and drives them into physical stores in order to enjoy the wide range of choices they have naturally become accustomed to. Lacking confidence in what they can find online, local shoppers will be less inclined to spend time looking, leading to less time spent overall on various e-commerce sites. This is a psychological barrier that e-tailers will need to work at overcoming. But as it stands, for various reasons, local merchants and brands have sparse product ranges listed online – which is often coupled with poor or unreliable delivery. As such, many local shoppers only hop online to research price points and find favourable deals, at which point they then travel to physical stores to complete the purchasing process.
For South Africans to move online and actually spend significant amounts (on a regular basis), they need to be presented with better quality products, and more of them. As it stands, local e-tailers are expecting to simply win on price, but it is arguably diversity and quality that will both differentiate them and drive the growth of South African e-commerce.
Showcasing the Standouts
The good news is that there are an increasing number of new players entering into this space that are experimenting with and pioneering different models. As mentioned above, infrastructure and delivery remain difficult, and there are psychological barriers to overcome before local online retail can reach its critical tipping point. The upcoming PriceCheck Tech & E-Commerce Awards will draw attention to some of the strides being made by individuals and companies, and will also highlight where some of the weaknesses lie.
Looking ahead, there are infinite opportunities for South Africa’s emerging e-commerce players – both established and entrepreneurial – but the key to long term success will surely lie in providing consumers with far more than what the local mall can offer.
* 2015 South African eCommerce Awards survey
Huawei Mate 20 unveils ‘higher intelligence’
The new Mate 20 series, launching in South Africa today, includes a 7.2″ handset, and promises improved AI.
Huawei Consumer Business Group today launches the Huawei Mate 20 Series in South Africa.
The phones are powered by Huawei’s densest and highest performing system on chip (SoC) to date, the Kirin 980. Manufactured with the 7nm process, incorporating the Cortex-A76-based CPU and Mali-G76 GPU, the SoC offers improved performance and, according to Huawei, “an unprecedented smooth user experience”.
The new 40W Huawei SuperCharge, 15W Huawei Wireless Quick Charge, and large batteries work in tandem to provide users with improved battery life. A Matrix Camera System includes a Leica Ultra Wide Angle Lens that lets users see both wider and closer, with a new macro distance capability. The camera system adopts a Four-Point Design that gives the device a distinct visual identity.
The Mate 20 Series is available in 6.53-inch, 6.39-inch and 7.2-inch sizes, across four devices: Huawei Mate 20, Mate 20 Pro, Mate 20 X and Porsche Design Huawei Mate 20 RS. They ship with the customisable Android P-based EMUI 9 operating system.
“Smartphones are an important entrance to the digital world,” said Richard Yu, CEO of Huawei Consumer BG, at the global launch in London last week. “The Huawei Mate 20 Series is designed to be the best ‘mate’ of consumers, accompanying and empowering them to enjoy a richer, more fulfilled life with their higher intelligence, unparalleled battery lives and powerful camera performance.”
The SoC fits 6.9 billion transistors within a die the size of a fingernail. Compared to Kirin 970, the latest chipset is equipped with a CPU that is claimed to be 75 percent more powerful, a GPU that is 46 percent more powerful and an NPU (neural processing unit) that is 226 percent more powerful. The efficiency of the components has also been elevated: the CPU is claimed to be 58 percent more efficient, the GPU 178 percent more efficient, and the NPU 182 percent more efficient. The Kirin 980 is the world’s first commercial SoC to use the Cortex-A76-based cores.
Huawei has designed a three-tier architecture that consists of two ultra-large cores, two large cores and four small cores. This allows the CPU to allocate the optimal amount of resources to heavy, medium and light tasks for greater efficiency, improving the performance of the SoC while enhancing battery life. The Kirin 980 is also the industry’s first SoC to be equipped with Dual-NPU, giving it higher On-Device AI processing capability to support AI applications.
Read more about the Mate 20 Pro’s connectivity, battery and camera on the next page.
Epic Games brings a
Nite-mare to Android
Epic Games’ decision to not publish games through Google Play inadvertently opens a market to Android virus makers, writes BRYAN TURNER.
Epic Games, the creator of Fortnite, decided to take the high road by skipping Google Play’s app distribution market and placing a third-party installer for its games on its website. While this is technically fine, it is not recommended for the average user, because allowing third-party installers on one’s smartphone opens up the possibility of non-signed and malicious software to be run on the smartphone.
In June, malware researchers at ESET warned Android gamers that malicious fake versions of the Fortnite app had been created to steal personal information or damage smartphones. A malware researcher demonstrated how the fake applications works in the Tweet below.
Example how you can get infected by downloading #Fortnite Android app from YouTube video with 130K+ views.
This one send SMS to premium rate number and downloads another fake app. pic.twitter.com/pYj8GZoqoZ
— Lukas Stefanko (@LukasStefanko) June 21, 2018
While the decision to bypass Google Play was a bold move on Epic Games’ part, it has been a long time coming for app developers to move their premium apps off Google’s Play Store. The two major app distributors, Google Play and Apple’s App Store, take a 30% cut of every purchase made through their app distribution platforms.
The App Store is currently the only way to get apps on a non-modified iOS device, which is why Epic Games had no choice for Fortnite to be in the App Store. On the other hand, Android phones can install packages downloaded through the browser, which makes the Play Store almost unnecessary for the gaming company.
The most interesting part of this development is that Google is not the “bad guy” and Epic Games is no saviour to other game developers. Epic Games is a company with a multi-billion dollar valuation and has resources like large-scale servers to distribute and update its games, a big marketing budget to ensure everyone knows how to get its games, and server security to protect against malware.
Resources of this scale allow the game company to turn a cold shoulder to Google’s Play Store distribution and focus on its own, in-house solution.
That said, installing packages without the Google Play Store must be done carefully, and it is essential to do homework on where a package is downloaded. Moreover, when a package is installed outside of the Google Play Store, a security switch to block the installation of third party apps must be turned off. This switch should be turned back on immediately after the third party package is installed.
This complex amount of steps makes it less worthwhile to install third party apps, in favour of rather waiting for them to reach the Play Store.
From a consumer perspective, ESET recommends not installing packages outside of the Google Play Store and to ignore advertisements to download the game from other sources.