It is not news that e-commerce has been steadily growing in the Kenyan economy with sites like Jumia and Kilimall in the spotlight of course. However, it seems like the growth isn’t just as fast as indicated by the latest data.
According to a report by a global advisory firm Dalberg, retailers and consumers have shown to prefer social media sites more than e-commerce platforms. This was associated mostly with the direct marketing, engagement between businesses and buyers and flexible payment that the online shops offer.
The slow adoption of online marketplaces was explained as a result of high delivery costs, highly fragmented markets and lack of clear addresses leading to supply chain barriers. These are factors that were confirmed by a previous report by the Communication Authority of Kenya.
“This figure (13%) underestimates the real extent of e-commerce, as respondents largely reported the use of marketplace platforms like Jumia and Kilimall, while the full breadth of e-commerce also encompasses digital trade through informal platforms,” the report stated.
As reported by Dalberg, 2,456 households across the country took part in the survey with members who are avid users of the digital economy. As it stands, there are over 100 online retail marketplaces and stores in the country.
We have seen platforms like Safaricom’s Masoko leave the scene citing the need to focus more on key product lines like M-PESA.
This report definitely comes at a time when individual online stores have grown in insane numbers over the last two years or so. This is as more business people choose to have to take their stores to social media sites like Instagram for affordable marketing. So, it’s safe to say that this method has worked so far.