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Timing matters in making ecommerce jump in Africa

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Many businesses are in danger of falling behind by ignoring ecommerce. Digital Planet CEO NEIL WATSON urges business to add an online sales channel before it’s too late.

Think ecommerce in Africa is still lagging behind the rest of the retail world? Think again. The success of relatively new online retailers such as Zando and Konga is proving that the continent is more than ready for online shopping. Take JUMIA, the Nigerian online shopping platform that was started in 2012. Less than three years later, the business employs 1 000 people and has warehouses in eight other countries.

Once, having an ecommerce channel may have been optional for business, but with each passing year and new set of figures, it becomes clearer that this is no longer true. The recent DHL Shop the World report highlighted the high growth potential of emerging markets in ecommerce. McKinsey highlights that the African ecommerce market is accelerating after a slow start and could soon account for 10 per cent of all retail sales.

Is time running out for retailers who haven’t yet made the leap to online platforms? The evidence certainly seems to say so. Some online players in South Africa are growing faster than brick-and-mortar shops, which means they are cannibalising traditional retail. For retailers, online platforms are becoming increasingly compulsory not just as additional sales channels, but to ensure that ecommerce players don’t end up eating their lunch.

The most important part of ecommerce is investing at the right levels at the right time. This differs depending on the kind of product you’re offering and how comfortable consumers are purchasing your product online.

For IT sellers, for example, the market is mature enough that it may already be too late. There are too many online players fighting for a piece of the pie.  Unless you have a big brand, an innovative concept or a lot of marketing spend, it will be hard to get above the crowd.

On the other hand, some markets such as fashion apparel are just beginning to mature. Players like Mr Price have invested tens of millions in building their online brand, ensuring that they are at the forefront and will be directing the market in South Africa.

Once you’ve determined that it’s time for you to build your ecommerce store, you then need to look at investing the right amount for the next three to five years. It can be tricky to invest at the right level. In large organisations, we often see an over-investment in technology when the market doesn’t warrant it. Investing too heavily too early means you may never see a return on investment.

The later you engage in online retail, the more developed the market will be, which has both advantages and disadvantages. A more mature market means that technology is more mature and there are skills available.

The downside is there will already be more competitors and it will be more expensive to establish yourself as a brand. You’ll also be learning while everyone else already understands the market so you could suffer reputational damage. Finally, the skills will be there, but will be much more expensive.

For most companies,  it’s better to start too early than too late. This will give you scope to experiment so that when the market arrives, you’ve learned your lessons and can take advantage without huge marketing investment and reputational risk.

Once you’ve determined the right time to make the leap, the real work starts. From the planning stage to the fulfilment stage, there is a lot that goes into a successful ecommerce channel. Customer service, logistics, reverse logistics, warehousing, marketing and many other specialised areas need to be considered. Most businesses do not currently have skills to tackle it on their own and would be advised to seek outsourcing partners who do have those skills on hand.

One thing is certain when it comes to ecommerce – it’s not a question of whether to explore online platforms but when. South African customers may have been slow to start transacting online, but we’ve reached the tipping point for ecommerce.

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CES: So long, and thanks for all the beer!

Last week, the Las Vegas expo showed off its fun side with state-of-the-art technologies for enjoying beer, writes BRYAN TURNER

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From craft beer-making machines to robots that pour beer, CES had more beer than usual in Las Vegas last week. And even free beer if you found the right stand. Stampede’s saloon-style booth offered beer to visitors who tried out its latest drones, virtual reality, and other gaming products. No beer tech, though.

Here are some of the beer technologies that stood out:

LG HomeBrew – Craft beer made at home

LG’s HomeBrew craft beer-making machine,  debuted at CES 2019, brings the brewing process home thanks to single-use capsules,  a self-cleaning feature, and an algorithm optimised for fermentation. 

Like a Nespresso coffee machine, the beer maker uses capsules, which contain malt, yeast, hop oil and flavouring. At the press of a button, LG HomeBrew automates the whole procedure from fermentation and carbonation to ageing. A companion app lets users check HomeBrew’s status at any time during the process, from their handsets.

The beer machine not only offers a simple way to make craft beer, but also enhances the quality of beer it makes. The fermentation algorithm intelligently controls the fermenting process with precise temperature and pressure control. It automatically sanitises itself, using nothing more than hot water, ensuring everything is hygienically clean for the next batch.

Designed with discerning beer lovers in mind, HomeBrew allows for in-home production of batches of more than 4 litres of beer in a variety of styles. The following five distinctive, flavoured beers are available now: 

  • Hoppy American IPA
  • Golden American Pale Ale
  • Full-bodied English Stout
  • Zesty Belgian-style Witbier
  • Dry Czech Pilsner

The only catch? It takes about two weeks to make, depending on the beer type.

“LG HomeBrew is the culmination of years of home appliance and water purification technologies that we’ve developed over the decades,” said Dan Song, president of LG Electronics Home Appliance & Air Solutions Company. “Homebrewing has grown at an explosive pace, but there are still many beer lovers who haven’t taken the jump because of the barriers to entry, like complexity, and these are the consumers we think will be attracted to LG HomeBrew.”

Click here to read about the party speaker that holds beer and robots that pour beer.

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CES: Alienware gets Legend-ary

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At CES in Las Vegas last week, Dell’s Alienware released a family of high-end, thin, light, and affordable machines for both amateur and professional gamers – and a new identity.

Alienware marked CES 2019 as a brand milestone with the debut of a new design identity, Alienware Legend. It aims to set a new bar of excellence for what gamers want most – performance and function. Alienware says it evaluated multiple concepts and chose one that was the biggest and boldest departure from its current look.

Alienware Legend, says the company, stays true to the brand’s core design tenets, taking cues from its deep roots in sci-fi culture and its early industrial designs, to distinguish the brand from the rest of the industry. The new Legend design is optimised with cutting-edge thermal cooling technology to achieve and sustain overclocking power, improved AlienFX lighting, and ultra-thin screen borders. It also unveiled a new “three-knuckle hinge” design that reduces the overall dimension while creating a stronger assembly, all combining to yield a better gaming experience.

“We’re excited to come to this year’s CES with some truly groundbreaking products, next-gen software and strategic partnerships that will bring more people to experience PC gaming and advance the industry,” said Frank Azor, vice president and general manager of Alienware. “The legend design answers the call for more and better from our gaming community, and the new G Series laptops will make PC gaming even more accessible to those looking for high-performance gaming at a cost they can appreciate.”

Click here to read about Alienware Legend in action with the Area-51m and m-series laptops

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