Everybody is a competitor but also a friend in the relatively small African e-commerce market, according to Julian Artope, general manager of Ringier Africa.
Ringier is a Swiss media house which runs eight online platforms in four African countries, including Tisu and Rupu, the number one online commerce platforms in Ghana and Kenya respectively.
Speaking at the ongoing 14th Africa’s Payments, Banking and Retail Show 2014, in Johannesburg, South Africa, Artope said Ringier’s general strategy is “to go to the market first and establish a number one position”, but said the company had learnt a number of lessons since entering Africa, not least in terms of competition.
“Everyone is competition. One of the first mistakes we made when we came to Africa was thinking we were a group-buying model, so we need to look at other group-buying models. It was just a gross misunderstanding on our part,”” he said.
“In the end we are all competing for the same customers. They don’t care about your business model, they are only concerned about the experience.”
He said e-commerce platforms should focus on the experience of their customers.
“They won’t be interested in your business model or your fancy website design,” he said. “We are really stuck with selection of goods, price and experience.”
Though everyone is competition, Artope said everyone is also a friend when it comes to growing the market and educating consumers on e-commerce.
“In Kenya and Ghana we are working in a very small market, so we have to grow the market to expand,” he said. “In e-commerce we welcome new players as long as they increase customer education.”
He stressed the importance of offline to e-commerce platforms, saying companies needed to physically meet their customers and sell their goods.
“People only really start trusting you when they see you in real life,” he said.
“It might not be very scalable in the beginning, but it certainly impacts on sales.”
He also advised companies not to go niche, pointing to the recent shutdown of a number of niche e-commerce sites owned by Naspers in South Africa.
“Don’t go niche. You really don’t want to do an online pet food store in Zambia,” he said.
Given the size of the market, he said new entrants needed to be aware they were playing a long game in Africa rather than making quick returns.
“Have patience and be realistic. If you are doing e-commerce in Africa you have to be in it for the long-run. Being first is extremely important, as it being fast and being aggressive,” he said.
“There are enough ideas and there is enough potential, but it is early days. Take your time, play it long-term.”
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