The effects of COVID-19 might spur e-commerce to further growth

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By Ezedi Udom

It has been widely said that the aftermath of the Coronavirus outbreak includes the new reality that we will never return to our familiar world of normal. Instead, we are now in a world of new normal that implies we embrace new ways of doing things.

Interestingly, one of the positive game-changing new realities that the Coronavirus pandemic is impacting on the ecosystem is the increasing popularity of online shopping and importance of e-commerce platforms like Alibaba, Amazon and Jumia, to mention a few.

 

According to experts, despite the multifarious adverse effects of COVID-19, one of the emerging new fundamentals arising from the pandemic is the better understanding that digital and e-commerce operators played pivotal role in ensuring cross-country and cross border movement and delivery of essentials such as groceries, pharmaceuticals and medicaments in the peak of the crisis.

 

The International Trade Centre in partnership with the United Nations Economic Commission for Africa at a recent online event on the future of e-commerce in the wake of the COVID-19 pandemic, affirmed that e-commerce could help Africa’s businesses relaunch and return to profitability.

 

“During the pandemic, e-commerce solutions have played a critical role in ensuring business continuity for many companies. They have been a crucial channel for providing vital goods and services. For many micro, small and medium-sized enterprises (MSMEs) in Africa, e-commerce has offered a lifeline and can continue to play a principal role in their economic recovery,” it was reported.

 

More cheering news is that the new normal is presenting more opportunities to push e-commerce further upscale. In fact, we might be entering the ‘e-commerce era’ as the pandemic represents a big opportunity that can spur further growth of the evolving e-commerce sector in Nigeria and other African countries with Jumia leading other operators from the front.

Nigeria currently ranks on the list of countries with high daily COVID-19 infection while the Presidential Task Force on COVID-19 has warned of many unsuspected asymptomatic cases. This alert is a wise counsel to limit physical contact.

 

Increasing safety awareness and consciousness among Nigerians means that as months go by, most people will be compelled to limit physical interactions by shopping and transacting businesses online more; work more remotely from home and do lots more digitally.

 

The transition in consumer behaviour and business activities to the online space from the traditional brick-and-mortar settings is expected to significantly increase the number of online shoppers and ultimately double the growth of Jumia and other e-commerce players.

 

With Jumia marketplace, Jumia Services (logistics), JumiaPay and Jumia Food amongst other innovative offerings, Nigerians can avoid coming in contact with unsuspected COVID-19 infected persons that they may unknowingly meet if they go shopping in the malls, supermarkets, open markets or banking halls that are usually overcrowded.

 

More residents adopting social and physical distancing by making use of e-commerce platforms for their purchase and payments, have the propensity to impact the growth potential of Nigeria’s e-commerce ecosystem in the coming months.

 

As the federal and state governments allow more sectors of the economy to reopen for business, more consumers and sellers will certainly migrate online to enjoy better shopping experience including convenience and faster ordering, payment and delivery of orders, and cost efficiency for both buyers and sellers.

 

The anticipated shift in the buying and selling habits can include the fact that many buyers will be less willing to go to crowded malls or shops to purchase things. They will also not likely try to buy items that other customers have already touched or test-fitted in case of ready-to-wear clothes in the boutiques.

 

The fear of coronavirus being transmitted through exchange of cash also makes online shopping and online payments a new frontier for many shoppers.

 

With an increasing number of employees working from home, and government limiting social events because of the need to curb large gatherings, online demand for and supply of casual and leisure wear have been predicted to rise. This trend in itself will boost MSMEs garment manufacturers.

 

Experts also expect increased demand for virtual banking and cashless transactions to spike e-commerce growth in the country. With safety-consciousness as the new norm, more Nigerians will likely not be comfortable around crowded ATMs or spend time in crowded bank halls to make transactions. They will rather opt for online banking like JumiaPay, which they can do from the comfort of their home.

 

Also, it is almost certain that many people now do not like to use ATMs used by people whose COVID-19 status they may be unsure of. Even at the malls, supermarkets or retail fuel stations, Nigerians are becoming more wary of handing over their credit cards to shop assistants and attendants whose compliance with the World Health Organisation’s (WHO) hygiene practices’ protocol they cannot verify. More time online will increase the efficacy of the website as a marketing channel.

 

With eyes on economic diversification through non-oil commodities, promoting financial inclusion among the unbanked segment of the population, and tapping on the digital economy to increase GDP, the Nigerian government has so much to gain by encouraging more Nigerians and businesses especially MSMEs to take advantage of digitalisation with e-commerce being the catalyst.

And as the economy reopens in full throttle in coming weeks and months, it should be noted the enforcement of social distancing and avoidance of crowded places would only be achieved when there is transitioning of consumer and business activities from the brick-and-mortar structures to the online marketplace.

 
Ezedi Udom, a Business Communications Expert writes from Lagos.

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