The leading online retailer in Nigeria is Rocket Internet- backed Jumia, employing over 500 coworkers and operating their own delivery fleet. Jeremy Hodara, Co- Founder of Jumia and CEO of Rocket Internet Africa & France, will be one of theGlobal E-Commerce Summit‘s expert speakers in 2014. We have spoken to him about Jumia’s e-commerce success story.
E-Commerce is becoming a global matter- and not only from a customer’s perspective. Retailers are getting increasingly aware of a “brand new world”- new markets hungry for trends and highly up-to-date when it comes to the latest technologies. One of these markets is Nigeria. Nigeria is an interesting e-commerce market, with growth driven by the lack of an adequate retail infrastructure and a large part of the population accessing internet through mobile devices.
Scarcity of shopping malls drives online retail
One of the main reason why e-commerce in Nigeria is very rapidly gaining popularity is the fact that there are only very few shopping malls catering to the needs of the over 170 million Nigerians. This has been beneficial for Jumia’s establishment as a leading player: ‘Jumia has become the largest online retailer in Africa. Especially within Nigeria we are the leading player in the market and this has been a key element towards our success story,’ says Jeremy Hodara. He adds: ‘The number of online users is increasing rapidly, especially as a large part of the population owns mobile devices. The shift from offline to online creates huge opportunities to leapfrog traditional retail and go straight to e-commerce – we can do it all online.’
E-commerce has revolutionized African shopping behavior
E-commerce is increasingly changing the way Africans shop, but there are still major challenges to be overcome. Most of the challenges are infrastructure related. Jumia has invested in tackling these obstacles by creating a cross-border setup and building several logistics centers, including a 9000 m² e-commerce campus in Lagos. Above that, Jumia works closely with local partners such as MTN and Millicom, which are leading companies in Africa’s digital industry. A successful strategy, says Hodara: ‘At the moment, we are the only African cross-border player with the widest reach on the continent led by Nigeria, Kenya, Morocco, Egypt, Ivory Coast and South Africa. E-commerce has completely revolutionized the way African’s shop online, even though the vast continent presents some challenges, mainly infrastructure related,’ he states.
‘E-Commerce in Africa could be above 50 percent’
Jeremy Hodara believes, that the e-commerce potential of the African continent could be enormous. ‘In many parts of Europe and the US e-commerce is up to 15 percent of retail. We think that in Africa, e-commerce can reach above 50 percent. There are huge opportunities and by now, there is no other online shop in Africa that has such a wide assortment and international setup that we have. Currently, JUMIA is number one,’ he confirms the promising outlook for Jumia on the African market.
‘We want to see Africa develop through e-commerce’
From a global perspective, Hodara believes that mobile internet access will be the norm everywhere. Whether in Africa, Europe, Asia or the U.S., customers will have access to latest trends at any time and at any place. As these omni-connected consumers are increasingly dictating the pace of retail, global e-commerce will increasingly depend on prices, supplies and services. Jumia is determined to keep pace and support Africa’s economic development through online retail growth: ‘This is something we feel Jumia is taking a leading role and is continuously focused on. In the next 10 years, we want to see Africa develop through the e-commerce market and entrepreneurship to provide several avenues for more businesses like Jumia’, Jeremy Hodara proclaims.
Understanding culture and challenges key for foreign companies
Foreign companies could potentially also reap many benefits when expanding into the African market, as Hodara believes that in general, African’s are hungry for consumption. However, he stresses the importance of ‘breathing the African culture’. Above that, companies must be ready to invest in order to overcome the local challenges. For Jumia, building an own infrastructure was one of the necessary steps: It created its own delivery fleet to ensure the quality of its fulfilment service. Jeremy Hodara: ‘This is a very, very difficult part and it can take a long time and understanding of the market.’ Once these considerations are made, there are loads of opportunities on the African market: Consumers are ready to buy many product categories online, including fashion and electronics, especially mobiles phones such as Tecno or Samsung, believes Jeremy Hodara.
Free access for Company Members and Business Partners
Company members of Ecommerce Europe receive 1 Full Conference package and Business Partners two packages to the Global E-commerce Summit. This includes The Pre-Conferences held by Ecommerce Europe and the European E-commerce Awards.