Ethiopian Stirring E-commerce Growth in Ethiopia

ET Corporate Communications

The advent of digital technology coupled with the boom in commerce within national boundaries and globally has ushered in the era of e-commerce, empowering individual consumers to transact at their fingertips. Though digital transaction brings immense benefits to both businesses and consumers in terms of accessibility, ease and efficiency, it cannot be realized without mature internet connection, open financial systems, digitally literate society and availability of web-shops.

Hurdles on the Way

Almost all the ingredients necessary for a thriving e-commerce were missing in Ethiopia’s technological landscape few years back presenting a daunting challenge to businesses which sought to engage in e-commerce. Banks were not open for digital transaction and lacked systems which accommodate e-commerce. Digital transaction did not take root in the country as it was not a culture. On top of that, companies didn’t provide web shops tailored to local customers with local payment options and languages.

Airlines

All these challenges meant that e-commerce had very little foothold in Ethiopia and forward looking companies such as Ethiopian Airlines were having a hard time venturing into digital transaction. In 2017, only four percent of passengers in Ethiopia transacted digitally to book air tickets, pay and check in online. Members of the diasporas and expats working in Ethiopia were the main users of Ethiopian’s digital offering.

the airline’s services available online 24/7.

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Facing the Challenge Head On

Ethiopian Airlines has taken different measures to address the challenges that kept its digital offerings from gaining wider acceptance and usage by passengers in Ethiopia. In spite of the seemingly daunting hurdles, there were opportunities for Ethiopian Airlines to significantly boost e-commerce usage by leveraging technology to standardize and enhance services. Travel from and within Ethiopia was growing and there was an opportunity for wider acceptance of innovative platform that makes the airline’s services available online 24/7.

Approaching banks to open up their systems and embrace digital transaction was one of the measures we took to address the challenge in Ethiopia’s e-commerce industry. We gave banks the opportunity to come up with systems which are good enough to interact with e-commerce websites. There was a significant appetite from the banks’ side to open up their systems and venture into e-commerce as they too saw benefits in store for them in terms of cost reduction and efficiencies. It took most of the banks a couple of months to develop e-commerce enabled systems. We have also created a web shop which enabled customers to book, pay for and secure their tickets using devices at their fingertips. As awareness and confidence is a prerequisite to the acceptance of new products, we have launched an aggressive integrated marketing

campaign dubbed “Go Digital”. Using multiple channels, we sent consistent messages about the benefits of digitally transacting with Ethiopian in terms of avoiding long queues at ticket offices and call centers.

The campaign included publicity through radio, TV, print and social media; sales promotions through incentives such as discounts, mileages, free tickets and upgrades; advertising on TVs, radios, newspapers, etc; direct marketing to customers through emails and SMS enticing them to download Ethiopian mobile app; and personal selling by deploying staff at Addis Ababa Bole International Airport and ticket offices to demonstrate how the app is used.

A dedicated 24/7 structure was also put in place to enable customers to access our digital service whenever they wanted. Staff also monitored the usage and provided support to customers through calls, social media and email during and after customers’ experience with our digital offering.

The other measure we took was building new digital marketing capabilities to capacitate our staff to run the system professionally and lay the ground for successful e-commerce endeavors. We have provided our staff with training on search engine optimization, social media marketing, email marketing, etc as part of the capacity building initiative. Building such digital skill set also boosted our capacity in terms of mobile development, cloud development, automated testing, etc.

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Results Achieved

The net result of all those efforts was tremendous! The four percent digital usage in Ethiopia by the end of 2017 leapt to 40 percent in two years’ time. Currently, there are over 350,000 online customers in Ethiopia and revenue of 2.8 billion ETB has been garnered through digital sales. The feature of our mobile app has also seen significant improvement since its launch to meet the evolving needs of local customers. The app also offers 11 local payment options in Ethiopia and is accessible in Amharic, Oromiffa and Tigrigna for local users. It has also been enhanced to allow authorized

receipt generation. With the increase in product awareness among local customers, the user base is also increasing from time to time.

What Next?

Going forward, we plan to expand Ethiopian Chabot across social media messaging platforms such as Telegram, Messenger, WhatsApp, etc. These platforms are enjoying exponentially growing customer base in Ethiopia, and making the Chabot available on those platforms will help us attract more customers to our digital offerings. Adapting those platforms for the travel experience and enabling passengers to book, receive tickets and checkin through those platforms will be an

area we will continue to work on in the future. We have already tested this at Addis Ababa Airport among domestic users, and got tremendous acceptance and transaction growth. Currently, 30 percent of domestic passengers check in through social media messaging platforms. We also plan to introduce guided speech conversation into the Chabot which currently converses in text only.

Likewise, we will add more local features on our mobile app including an airport map which will better guide passengers through Addis Ababa Bole International Airport which has seen massive expansion recently. We would also like to serve as digital retail service providers integrating more offerings such as hotel, tour package and WiFi service on our mobile app and better serve domestic tourists. Better utilization of internet of things (IOT) technologies and aggressive awareness creation and marketing are also among the initiatives we have in the pipeline. As building digital skill set is one of the key areas in our digitization initiative, we will keep building our in-house capability and be in a better position to develop products and service keeping pace with emerging technologies.