SA’s e-commerce market could double if it builds trust, ease-of-use and after-sales support
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South Africa’s e-commerce market had the potential to double by a further 100 percent to 5.6 percent of the total retail market if e-tailers beefed up their trustworthiness, ease-of-use, security, delivery and after-sales support, known as CX issues, according to the third annual South African Digital Customer Experience Report.
The report’s key finding was that R30 billion was being left on the table by e-tailers with poor CX - R12bn in CX issues and R20.4bn in cart abandonment - meaning the e-tail market has the potential to double to 5.6 percent. This as the current e-commerce market value stood at R30bn.
The report found 96 percent of respondents said they would spend more online if e-tailers’ CX was better. Collectively, these glitches were estimated to cost e-tailers R11.95bn in lost sales.
The report is based on an annual ovatoyou study among 2 000 online South Africans and commissioned by Rogerwilco.
Rogerwilco chief executive Charlie Stewart said the opportunity cost was pretty clear as consumers expected a higher level of experience from brands that they bought online from.
“This could in part be because they have become used to the CX of an Amazon or Takealot. These brands have set a high bar and local e-tailers need to up their online game if they are to convert the huge appetite among consumers for online shopping into rands and cents,” said Stewart.
Ovatoyou’s Amanda Reekie said online shopping had seen a sharp increase since the start of the pandemic and was one of the few sectors to find a silver lining. This had democratised its user-base as the report reveals that a full 82 percent of respondents had made an online purchase, with 73 percent of those with a monthly household income of less than R10 000 per month shopping online.
Of significance, 32 percent said that they had increased the number of online stores that they brought from, 31 percent had made online shopping a part of their shopping routine while 20 percent reported to be shopping more through social media.
CX professional Julia Ahlfeldt said with improved levels of connectivity and an abundance of online shopping options, there was no good reason for South Africa to lag behind other markets such as the US and UK. She said that customer experience was well and truly holding it back.
For South Africa’s e-tailers to capitalise on this online boom, the authors of the study said they needed to address issues of cart abandonment, given 76 percent of the respondents said they failed to conclude their purchases (up from 71 percent from the 2019 report). Over half of those polled (51 percent) indicated that high shipping fees were to blame, with 32 percent noting lengthy delivery timelines were a deterrent.
A further third complained that there were too many steps in the purchase process, and brands would do well to emulate Amazon’s famous one-click checkout, with slow websites and a lack of support being cited as other reasons for cart abandonment. Payment issues either a complete failure in the processing of the transaction (cited by 26 percent) or an issue with a discount code (20 percent) continued to bring significant impediments to closing the sale.
Building and maintaining trust was said to be another key focus area for online brands, and, while it was intangible and could make or break a sale.