2014 was a very interesting year for ecommerce on the African continent. There was acquisitions, mergers and overall lots of movement. Lets be honest for a moment – African ecommerce is not on the front pages of TechCrunch or on the radar of most investors. It is a long term ecosystem filled with the challenges such as logistics, low credit card penetration and most importantly customer distrust. When I wrote my year in review post, I wrote on regions which got lots of media coverage in 2014.
@henlaub theres been a lot of movement. Deserves a separate piece
— Claude Hanan (@claudehanan) January 2, 2015
Takealot made the news on many occasions. First, they raised a $100 million from Tiger Global and that made most market watchers take note. A few months later they acquired Superbalist. At the latter part of the year, Takealot and Kalahari announced that they would be merging in 2015 subject to competition commission approval.
The major developments in 2014 where 2 items that got little press coverage. Firstly, retailers such as Mr Price and The Foschini Group invested in their ecommerce offerings. The Foschini Group spent a R100 million on their ecommerce business which will surely be widely used in 2o15. Retail in South Africa is still somewhat cautious to ecommerce but with ecommerce being less than 1% of total retail in the country.
Aramex acquired Postnet for R190 million ($16.5 million) in December. Aramex has been steadily acquiring South African logistics businesses over the last 5 years. Aramex is Amazon.com’s partner that ships items to South African customers.
We saw lots of innovation in South African ecommerce this past year. PriceCheck, Takealot and Kalahari all placed emphasis on their mobile apps. This is a trend I believe will be continuing in 2015. Kalahari also did a very interesting partnership with Uber for festive shopping.
The festive season also placed strain on various ecommerce businesses in the weeks leading to Christmas. Runway Sale, Kalahari and Takealot all had days in which their websites were down for a few hours. These are signs to me that ecommerce is becoming more widely used and will be a growing industry in 2015.
I expect 2015 to be a year which contains more consolidation, more customers and innovation as retailers begin to enter ecommerce more.
The Rest of the continent
Nigerian ecommerce was a title fight between Konga and Jumia and featured both businesses starting third party marketplaces. Both raised new rounds of funding; Konga from Naspers and Jumia from existing investors. Jumia also moved into new countries: Cameroon, Ghana, Uganda and Kenya. In 2015 I expect to see Jumia and Konga battle for market leadership and potentially consolidation in the Nigerian ecosystem.
Senegal also seems to be seeing investment from French ecommerce businesses. Cdiscount unveiled their Senegalese business in October.
2015 will be an interesting year as markets continue to grow and investors with a long term view look at entering the African continent,