CONTENTS w There’s more to e-commerce than meets the eye in SA w What South Africans want online – the numbers are telling us w A guide to running your online store efficiently w Buy now pay later Black Friday online sales triple – driven by women w 7 top smart products: Xiaomi’s smart gadgets are here to make life easier and convenient
Editor’s letter
CONTACT US PUBLISHER Vasantha Angamuthu vasantha@africannewsagency.com EDITOR Wesley Diphoko wesley.diphoko@inl.co.za DESIGN Dominique Owen dominique.owen@inl.co.za PRODUCTION Renata Ford renata.ford@inl.co.za BUSINESS DEVELOPMENT Keshni Odayan keshni.odayan@inl.co.za SALES Charl Reineke charl.reineke@inl.co.za ENQUIRIES iol.magazines@inl.co.za
THERE was a time when businesses were trying to convince people to buy online. People were sceptical of using credit cards for online purchases. There was just no trust in the system... except some early adopter consumers. Thanks to Covid-19 and other factors, consumers have been converted to buying online, as can be seen in our Global Web Index report feature. Businesses are now facing a new challenge of safeguarding consumers online. But consumers have to deal with online scammers who steal data, fake goods and other online dangers. Some businesses have just jumped on
the bandwagon and are battling to make it work. In this issue of IOL Tech digital magazine, we offer guidance on how business owners can run their online platform effectively. We also introduce the latest way in which Pick n Pay customers can interact with the local retail giant, thanks to an SA-founded company behind Clickatell. We wrap up all things e-commerce with the focus on an app that allows you to buy and pay later. We do this by sharing some data about how South Africans behaved online over the past few days. For instance, female shoppers were the biggest players during these super-sized shopping days (Black Friday and
Cyber Monday). We hope that you will find this content useful and informative. This year has been tough for businesses. We are looking forward to sharing more insightful content in 2022. Enjoy.
Wesley Diphoko
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A customer loads his shopping cart during Black Friday sales. | Reuters
There’s more to e-commerce than meets the eye in South Africa
IOL
WHEN setting up a brick-andmortar retail store, a business will take into consideration the size of the space, the location, foot traffic, the design, interior fittings and displays. After months to years of careful consideration, they’ll sink major investment into creating the space that will best serve their customers’ needs. That investment is made with the understanding that it will take a few years to show a return. An e-commerce shop front deserves the same attention – careful consideration of the complexities involved in setting up a new kind of store front, the right investment at the
The investment is made with the understanding that it will take a few years to show a return – if indeed it does
right time and thorough planning to have the best chance of success. The digital space is fundamentally different to physical retail – it’s a new landscape with different behaviours, customers that have diverse needs and one that depends on the establishment of a new supply chain and fulfilment mechanisms. An online customer for your brand has a different mindset from one who walks into your store to make a purchase. Product representation needs to be considered, multiple audiences should be built and tested through careful, strategic targeting and
communication, and the varying customer sets need to be nurtured differently throughout the stages of the purchase. e-Commerce really took off in South Africa as the first of the lockdowns started in March 2020, growing by 66% to more than R30 billion for the year. Before that, there were a few companies doing e-commerce well, another group largely unconcerned with it and a prospective business base that saw it as a luxury rather than a necessity. Despite a more subdued growth rate due to economic pressures in 2021, the value of online retail is still expected to top R40bn and account for 4% of all retail in South Africa. It shouldn’t come as a surprise that the losses incurred by traditional retailers, which recorded consecutive lows for 9 months in 2020, correlate with gains made by South African online retailers. The country’s largest online retailer, Takealot, grew its revenue by 41% to more than R3.3bn. Online retail has become an essential part of life overnight, forcing companies to switch to – or switch on – these channels. The problem? That the rapid about-turn or amplified focus wasn’t a strategic play in line with the development of the business, but rather an
emergency leap into the void created by a market shift. That means, for many businesses, the focus is currently on short-term sales spikes rather than developing their online brand and e-commerce operation for the long haul. That short-term mindset is understandable in a tough economic climate where digital channels have been a lifeline for many businesses – but the ultimate aim of e-commerce shouldn’t be survival. It should be building sustainable growth and ensuring competitive market penetration. Fundamental to customers purchasing online is not only the ability to ‘add-to-cart’ but also the credibility of the brand and the trust that it inspires in these customers to commit to your business through the binary veil – so building a brand in this space is as vital as it is in the physical one. There’s a heavy strategic component to building your digital shop, which requires the skills, expertise and investment you’d otherwise supplement for your brick and mortar. It also requires a partner to help navigate this complex technological world. That strategy is then developed and tested, and tweaked towards the optic of success. Working together on a
realistic,albeit ambitious, strategy that is based on an understanding of holistic strengths, weaknesses, opportunities, and threats is important to achieving success. At each phase of growth, there comes a time when the chosen platform or mechanism reaches the peak of its potential – and at that saturation point, the strategy must evolve, marketing must pivot, and things need to realign to business objectives to help the business continue to grow. As at 2020, South Africa was the 37th largest market for e-commerce, placing it ahead of Portugal and behind Nigeria, and 68% of South Africans are spending more time shopping online than before the pandemic. It’s a market that can’t be neglected any longer. Properly investing (time and money) on the back of global e-commerce growth is as essential as looking to expand your physical presence, but the potential of e-commerce goes beyond the people who walk past your shop front every day: You open up the business to a national and international customer base. You’re investing in the vision of the business. And it’s vital to have a partner who can help you scale digitally to maximise this potential offered by a world of prospective new customers.
Global Web Index reveals that, in addition to new shopp buying online, existing shoppers purchased more item online than they typically purchased in-store leading up to the pandemic
The numbers behind what South African shoppers want online are out and they are looking good Global Web Index reveals that, in addition to new shoppers buying online, existing shoppers purchased more items online than they typically purchased in-store leading up to the pandemic. While e-commerce has long been a part of the modern digital revolution, pandemic-related global lockdowns significantly accelerated online shopping activities and saw global e-commerce growing by 32% in 2020. According to Shopify, the industry is expected to total as much as $4.89 trillion (R77.38 trillion) in 2021. Global Web Index reveals that, in addition to new shoppers buying online, existing shoppers purchased more items online than they typically purchased in-store leading up to the pandemic. In fact, McKinsey & Company estimates that consumers were thrust into five years of digital adoption in a matter of only eight weeks. Oberlo states there were 4.66 billion active internet
users at the start of 2021. It adds that 92.2% of internet users visit online stores, 81.8% conduct online product or service searches, and 78.6% follow through with their purchases. What does this mean for marketers? Insights from Deloitte suggest that the increase in online purchases presents new opportunities for marketers, with e-commerce taking centre stage as a necessity in a modern digital marketing strategy. From diversifying across channels, taking heed of the power of video, engaging with consumers to swaying consumers’ purchasing decisions through the use of influencers, there are several strategic opportunities that marketers can harness for e-commerce success. While traditional brick-and-mortar businesses may be picking up, the retail space as it was once known has changed forever, and e-commerce is showing no signs of slowing down, compelling companies to adapt and embrace the digital possibilities. What’s driving the global online shopper? According to Global Web Index’ Connecting the Dots 2021 report, consumers in seven participating countries listed this as motivators that encourage their online purchasing habits: – 60% free delivery and returns
– 43% quick and easy checkout processes – 29% a brand’s community support during the pandemic – 29% an entertaining shopping experience – 28% a brand’s support of social causes – 25% the ability to virtually try on or test a product before purchase – 24% a virtual live product demonstration – 17% live Q&A sessions with product experts – 14% limited stock availability Where does South Africa stand? Independent technology market research organisation, World Wide Worx, asserts that South Africa’s e-commerce figures increased by 66% in 2020, with the total online retail amounting to R30,2 billion. These figures are more than double the number reached in 2018 (R14,1 billion) and 50% higher than the forecast for 2020 three years prior. What do South African online shoppers want? According to Deloitte Digital’s Digital Commerce Acceleration report, South African consumers have begun to dedicate more time to e-commerce, with over 70% claiming to shop online at least once a month. They dictate their online shopping preferences based on a variety of factors, and regardless of
pers ms
Online shopping for South Africa is not taking off. | Simphiwe Mbokazi
their segment or category, these foundational factors should be considered in a digital commerce offering. Ease of use 88% want efficient checkout transactions Consumers demand an effortless online shopping experience that includes options to suit their preferences, such as delivery and payment alternatives. Brands considering e-commerce should invest in intuitive and easy-tonavigate checkouts to provide a fast and seamless shopper and user experience. Delivery options 86% say high delivery fees influence their decisions Online shopping is regarded as more expensive than traditional means owing to the often costly
delivery fees. Not all consumers have the same financial freedoms as others, and brands should therefore offer different delivery options to suit their preferences, with more cost-effective means taking longer to reach their destinations as opposed to expensive priority ones. Customer service 86% highlight customer service as a priority Consumers want to partner with brands that offer fast response times and provide open lines of communication throughout the shopper journey, even in areas such as refunds and complaints. Brands must strive to communicate and offer consumers the support they want across all channels, including social media. Data protection 86% are concerned about poor
online payment security 81% are concerned with the lack of personal data protection In today’s digital world, abiding by the regulations set in the recent implementation of the Protection of Personal Information Act (POPI) is just the start of securing consumer trust, and all e-commerce brands should have the necessary security platforms in place to ensure the protection of consumers’ sensitive personal and financial data. Consumers want to shop with an online retailer with a trustworthy reputation, built through peer/online recommendations, prior effortless experiences, or superior consumer/ brand experiences. Brands must convey authenticity and consider brand-focused advertising to bolster consumer trust and confidence.
A guide on how to run your store efficiently online
YASMINE JACOBS yasmine.jacobs@inl.co.za
THE idea of starting your own business, not to mention an e-commerce store, is daunting but could pay off in the long run. With the Covid-19 lockdown, the internet has transformed the way we do business. According to the third annual South African Digital Customer Experience Report, South Africa’s e-commerce market had the potential to double by a further 100% to 5.6% of the total retail market if e-tailers beefed up their trustworthiness, ease-of-use, security, delivery and after-sales support. Today, the most successful businesses are completely online. However, as more turn to online to make money, it becomes harder to stand out. These are a few ways to run a successful e-commerce business: ◆ Build your community and connect your shop to your brand As with most websites, it is important to grow a community of people who will want to buy your products. Make good use of newsletters, social media and any technology tools that will grow your online community. Find your target audience and create a connection with them. Once you have done that, connect your shop to your brand.
With Covid-19, the internet has become more than just a way to stay connected. It has become essential and completely transformed the way we do business
◆ Fulfil orders punctually When you have built that trust, you need to keep that trust – and the best way to do that is not to let them down. Since customers expect their products to ship and arrive by the dates provided, they will be disappointed if you do not meet their expectations, regardless of the quality of the product. While quality is important, your delivery game needs to be good. You will need a strong team that can take care of the orders coming in. ◆ Avoid clutter on your website E-commerce websites with simple designs have higher conversion rates. Your homepage should have a clear point of focus, and the visitor’s eyes should be drawn straight to a call to action button or products you sell. It is also worth simplifying your menus and group the
products that you are selling. Too many menu categories will confuse the visitor, which will prevent them from finding what they’re looking for. ◆ Buy a premium web hosting service While it is tempting to go for the free or cheapest web hosting plan, it is much better to spend a little bit extra on the premium web hosting plan. Speed is one of the most important elements of a successful e-commerce website, and each page needs to load fast to yield high conversions. Research shows a one-second delay in page loading time can lead to a 16% decrease in customer satisfaction and a 7% loss in conversions. ◆ Accept several payment options Your e-commerce site needs to accept alternative
payment options such as PayPal, Apple Pay or Samsung Pay. Even if most of your customers have a Visa or MasterCard, they might prefer the alternatives. ◆ Eliminate steps in the checkout process When your customer gets to the checkout, they should find it easy to complete the purchase without hassle. All you need to ask for to process a transaction is billing information and shipping address. It is worth noting that additional steps in the checkout process will increase the chances of them abandoning the transaction. According to statistics, 28% of consumers said they abandoned a shopping cart during checkout because the process was too long and complicated.
Clickatell enables customers to be served via WhatsApp The easy to navigate menu allows shoppers to choose which action they want to perform
FAST COMPANY CONTRIBUTOR
CLICKATELL has been selected by leading African retailer Pick n Pay, to manage their WhatsApp customer communication channel. Customers can easily access Pick n Pay services by sending “Hi” to +27 60 070 3037. The easy to navigate menu then allows shoppers to choose which action they want to perform. The Pick n Pay WhatsApp channel currently hosts catalogues, Covid-19 FAQs, store locator, Smart Shopper card services and other customer services options. This partnership between Pick n Pay and Clickatell
enables customers to manage their Smart Shopper status and details via WhatsApp. This includes the ability for its nine million active Smart Shoppers to view their loyalty points balance, block their lost or stolen cards, as well as order card replacements. Also, customers can quickly and easily update their personal details and enter competitions. “According to Forrester, retail is leading the way in chat adoption, and we are excited to provide an engaging experience for Pick n Pay customers in chat. Consumers love chat and with the broad reach of
WhatsApp it is the perfect channel for Pick n Pay to serve their customers,” says Pieter de Villiers, chief executive and co-founder at Clickatell. Pick n Pay Smart Shopper has always been a firm favourite with South African shoppers and has recently been named as the most used loyalty programme in South Africa in the 2021 Truth & BrandMapp SA Loyalty Whitepaper. “We are constantly looking to improve our customer service and to make it easier for our customers to engage with us,” says John Bradshaw, head of Omnichannel at Pick n Pay.
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Payflex App on SA online buying behaviour and Buy Now Pay Later payment method
Black Friday sales triple BUY now pay later online sales this Black Friday and Cyber Monday are triple those recorded in 2020, driven overwhelmingly by South Africa’s female shoppers. This showcases how much more comfortable South Africans are with online shopping and especially interest-free payment options. “By 10am on Black Friday, sales value had already surpassed Black Friday 2020. By the end of Cyber Monday, sales value was three times higher than last year,” says Paul Behrmann, founder and CEO of fintech Payflex, which offers an interest-free buy now pay later (BNPL) payment solution. The top five categories of BNPL purchases over Black Friday and Cyber Monday were fashion, health, sports, gadgets, electronics and general retail. BNPL allows clients to spread their payments over the festive period and in this way, budget effectively for purchases. “Payflex is completely transparent with its customers and offers four equal
payments over six-weeks. They know the exact dates on which payments are due and the exact amounts. Our default rates are very low,” he says. Shopper volumes spiked this year at 10am and 12pm, with further spikes in the evening at 8pm, 9pm and 10pm, which indicates that people tend to think about what they’d like to purchase during the day and then make their purchases after work. In November 2018, Payflex had just eight merchants offering BNPL. This has swelled to over 1 200 merchants in 2021. Online merchants indicate that BNPL is attracting almost eight times more customers than traditional credit payment options. Behrmann says: “There is greater awareness of BNPL as an interest free payment option with consumers adopting BNPL as an alternative to expensive credit. BNPL allows customers to shop today and only pay a quarter of the cost upfront. It’s good for business, too – online
merchants see increased sales and larger basket sizes when customers pay with BNPL.” Several retailers have worked to create special deals for Black November, incorporating Black Friday and Cyber Monday, which has also driven up the numbers. Stef Michael, marketing executive at JD Tech which has brands like Incredible Connection, HiFiCorp and Everyshop), says: “Some promotions may only be valid for a limited period and consumers seek payment solutions that allow them to secure products. Consumers remain cash conscious and look for flexibility.” Superbalist.com co-chief executive officer David Cohen says that uptake of BNPL options has increased over the past year. “We believe this can be attributed to consumers gaining awareness of the multiple payment options available on our platform. Consumers can shop for the latest fashion without the added interest.”
| IOL Contributor
BRANDSTORIES
Xiaomi’s smart gadgets are here to make life easier and convenient THESE days, there’s a smart version of pretty much every device you can think of. Watches have turn into smart watches, ordinary light bulbs have turned into smart lights, vacuums have turned into robot vacuums and even your beside lamp has developed features to categorize it as a smart lamp. Xiaomi’s smart gadgets are here to make life easier and convenient. And their footprint across lifestyle and smart home tech categories is growing, and rapidly so. You can build an entire Xiaomi ecosystem and interlink your smart tech devices so that they all work together as one unit. All the Xiaomi gadgets can be connected and controlled via the Mi Home app on your smartphone. From the app, you can set a schedule for your robot vacuum to clean the floors at the same time every day (even when you’re not there), track your health data and fitness goals, set your lights to switch on and off, and check in on your home with your security cameras. Xiaomi has a wide range of tech that will upgrade your lifestyle and here are a few we’d recommend. For a comfortable start to the day, you can light up the
bedroom with the Xiaomi Mi Bedside Lamp 2. This is a definite one to add to your Xmas wish-list. Coming mid-November! There’s no need to even step out of bed, you can activate it via voice control with Google Assistant or Amazon Alexa. Adjust the brightness and lighting settings to suit the environment and your mood from the app or with touch control. The Xiaomi Mi Smart Electric Toothbrush T500 should be the next thing you grab. This smart toothbrush is not your average electric toothbrush. The T500 is not only more powerful, but also more protective. It removes stubborn plaque, reduces the pressure when brushing too hard and lets you access all the data you may find informative on the Mi Home app. Add it to your morning and night-time routine to keep your pearly whites extra clean. Slap the Xiaomi Mi Watch on your wrist and keep track of your fitness journey with each workout you accomplish. It’s ideal for those who are serious about keeping fit and tracking their progress as they reach their fitness goals. Aside from its ordinary smart features allowing you to check incoming calls and notifications, the Mi Watch
includes different sport modes, from HIIT workouts to triathlons and even swimming workouts. It accurately monitors and analyses over thirty key points, from your heart rate, calories burned and blood oxygen levels to check your health status at any time. It automatically detects when you start your workouts, and pauses and resumes as you do, ensuring that all your movements are recorded accurately. A smart speaker should be on everyone’s wishlist. It will act as your home’s digital assistant and allow you to control the other Xiaomi devices in your home. Besides delivering crisp quality audio, the Xiaomi Mi Smart Speaker can source information and can be operated hands-free via voice control. With a short “Hey Google, what’s the weather today?”, the Mi Smart Speaker will inform you before you even get to unlock your phone and open your weather app. Not only that, but you’re also able to set reminders and alarms. And did we mention that it plays your favourite tunes loud and clear to get you in the mood to cook, clean, or entertain your guests? The Xiaomi Mi Smart Speaker is a must-have in
upgrading your lifestyle. With Xiaomi, you can bring smart cleaning to your home too and the Xiaomi Robot Vacuum Mop Pro is the pinnacle of convenience. The Mi Home app allows you to switch the robot vacuum mop on remotely, change cleaning modes, set schedules and view a generated map of your environment and the path your robot vacuum takes. Once it is familiar with your surroundings, the Mi Robot Vacuum Mop Pro will have your floors clean and shiny without you having to do a thing. It can operate for a total of 2 ½ hours and will easily find its way back to the base when it’s low on energy. For more conveniences, the Mi Robot Vacuum Mop Pro can also be activated with Google
Assistant or Amazon Alexa. Installing security cameras is one way to make your home feel safe, inside and out. The Xiaomi Mi 360 Home Security Camera 2K allows you to check in on your home wherever you are via the Mi Home app. What sets the Xiaomi home security cameras apart from the usual, is that it records in 2K resolution, features two-way real-time audio communication, advanced night vision and human detection. This smart home security camera also alerts you when there are abnormal sounds, like dogs barking. And aside from its smart functionality, the Mi 360 Home Security Camera 2K is shock-proof and water resistant and has zero cables, so you don’t have to worry
about it getting wet or whether it will ruin the aesthetics of your home. Enjoy summer rides in town with the Xiaomi Mi Electric Scooter Pro 2. Thanks to its compact size it’s easy to carry, and its structural design lets you fold it in 3 seconds, making it easy to carry. Connect the Mi Electric Scooter Pro 2 to the Mi Home app to check riding stats, battery status and to upgrade firmware (when need be). Enjoy smooth and comfortable rides on flat roads or non-paved roads such as gravel, dirt roads, and even grass. It features a highcapacity li-ion cell battery that allows for up to 45km of travel distance, making it the perfect lightweight mobile accessory with unimaginable performance.
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