South Africa is the e-commerce giant’s most sensitive market in the sub-Saharan region (it already has a presence in Egypt following the acquisition of Souq in 2017) and it will compete in the country with local players, such as Takealot (majority-owned by media giant Naspers), Makro and Bob Group’s bidorbuy to tap into what is estimated at $3 billion in annual e-commerce revenues.
But, notably, Amazon is launching in South Africa without its well-known Prime Club program. That means no media services, no Prime-only service levels like loose submissions for a large number of items, and no sticky tools to catch other people and get back to them. your site over and over again other food shopping features (and pay Amazon for that privilege).
We’ve reached out to Amazon to find out when or if they’re most likely to go up Prime in the region and will update this article as we learn more. [Amazon declined to say whether it plans to launch a Prime deal in the country and declined to comment on the roadmap for Nigeria. ]
The facilities e-commerce giant said it first plans to sell foreign brands and local products covering about 20 product categories. Amazon will offer same-day and next-day deliveries, as well as 3,000 pick-up points, and without the bonus. As a free shipping bonus on a wide diversity of items, to attract customers, Amazon offers free shipping on everyone’s first order, as well as subsequent orders over R500 (~$27).
It’s unclear to what extent the country’s market lately wants or desires a player, and one from the U. S. is a player. In the U. S. , for starters. Local e-commerce entrepreneurs, however, see it as a strong signal about the overall strength of the country’s e-commerce market, which has faltered globally after a surge in usage at the height of the COVID-19 pandemic.
“Competition is first and foremost important news, as it validates the opportunities of African e-commerce and contributes to the expansion of the market. South Africa, however, is a very fast-paced market, far from most African countries, with mature retail networks, strong supply, and a very competitive e-commerce space,” Francis Dufay, CEO of Jumia, told TechCrunch about Amazon’s arrival.
However, the beginnings were slow in coming: Amazon had first announced two years ago that it would launch its launch on the continent, in two countries, Nigeria and South Africa. That in itself seemed to take advantage of Amazon, putting South Africa and the rest of Africa on the continent as a whole: in 2020, it had announced its first AWS Region for the continent, also outside of South Africa.
But as a result of this announcement, Amazon pushed back the release dates of both products. South Africa originally intended to delay it in April 2023. This was then postponed until October 2023, but that month it only started onboarding independent distributors in the country, and continued to rent in business development, software development, and operations.
Meanwhile, its launch in Nigeria, scheduled for February 2023, was also put on hold and the company has yet to provide an update on when it will open its doors.
Image credits: Amazon
However, the opportunity is clear. Africa as a continent is still in the early stages of e-commerce, and this can mean much more demanding situations when it comes to flattening origin chains and logistics, and transforming customer behaviour by making them more into settling in and paying for goods. Online, it represents a much greater expansion prospect for companies than other, more mature markets.
“We are excited to launch Amazon. co. za, together with thousands of independent distributors in South Africa. We offer our consumers the right price for their money, a wide variety (adding local and foreign products) and a convenient delivery experience. “Robert Koen, Amazon’s managing director for sub-Saharan Africa, said in a statement: “Building a strong relationship with South African brands and companies, big or small, is incredibly for us. We need Amazon. co. za to be the position where they can succeed in millions of consumers.
Amazon’s access to the South African market introduces the festival to a sector largely ruled by Naspers-owned Takealot, which accounts for nearly a portion of all online sales in the southern African country. Walmart-owned Massmart is also gearing up to launch its own e-commerce campaign. The timing of Amazon’s launch also coincides with an increase in online grocery shopping in South Africa in the wake of the pandemic, which has spurred more retail investment in the e-commerce sector.
Updated to note that Amazon already had an e-commerce operation out of Egypt. The South African market is the largest in sub-Saharan Africa. Amazon declined to say whether it plans to launch a Prime deal in the country and declined to comment on the roadmap for Nigeria.