Why SA’s E-Commerce Gold-Rush Is Still To Come

Posted on September 4th, 2017

BidorBuy Founder On Why SA's E-Commerce Gold-Rush Is Still To Come, And How To Prepare For It


If you want to sell your product online, Andrew Higgins is the person you want to listen to. He is the face behind some of the most dominant local e-commerce brands including Bidorbuy and PayFast.

Higgins launched Bidorbuy in 1999 when the internet was still relatively new in South Africa, and e-commerce was practically non-existent.

“It was in the late 90s when I was working in London for a company called QXL.com where we set up several online auction sites in the UK, Germany, France and Italy. So, I based the model for Bidorbuy on eBay, which is the world’s largest online trading community.”

Bidorbuy is an online retail and auction platform. They trade in everything from jewellery and watches to coins, cellphones, electronics and even cars.

The platform grew into the country’s biggest online marketplace, driven largely by increased internet penetration in South Africa. By 2010, Bidorbuy had more than 1,1 million unique visitors, 26 million page impressions, and 700 000 items listed for sale every month and gross merchandise was valued at R30 million per month, according to Entrepreneurmag.

Today Bidorbuy is not the only big e-commerce player around. It faces stiff competition from Takealot.com, both of which are fighting for market share, according to news portal, MyBroadband.

South Africa Is Yet To See Its E-Commerce Potential
“Although we are off a very small base, roughly 1% of retail in South Africa is transacted online, compared to America where it’s about 15% and over 20% in the UK. So, we are quite far behind, but it is growing at a constant linear rate,” Higgins says.

According to Fin2458% of online adults in South Africa shopped online last year, which amounted to an estimated total spend of R37.1 billion. This increase in online spending is also expected to keep growing.

Higgins is however, looking beyond growing e-commerce in the country, he is aiming to disrupt the retail sector as a whole.

“I believe that there’s a lot of room for disruption in the general retail space,” says Higgins.

He has already started in the payment space. He launched PayFast, a payments processing service, with co-founder Jonathan Smit.

PayFast enables the transfer of money from online buyers to sellers and includes payment options such as credit cards, Instant EFT as well as Bitcoin.

Launched in May 2007, the service had reached 80,000 registered merchants with over 1.5 million unique buyers having used the service by 2016 according to tech website, Tech Financials.

Higgins is also the MD of e-commerce portal, uAfrica. They provide consultancy services for all aspects of running an e-commerce business, in particular logistics which Higgins says is the last major hurdle for e-commerce to really takeoff in the country. uAfrica also conducts e-commerce research, training and hosting an annual e-commerce conference.

Higgins shares with SME South Africa how business owners can succeed with e-commerce. 

To Succeed, You Need To Give Your Customers What They Want!

When they buy something they want to have variety. It’s about price, choice and convenience.

E-Commerce Has To Compete Against SA’s Mall Culture

South Africa has a strong shopping mall culture, people like to physically touch the product in a mall for example.

… But 

I believe you can get a better experience through shopping online, you can often get things a little cheaper, you have more choice shopping online and it’s about convenience. You can have things delivered to your door without you having to get in your car and go fight traffic to get to a shopping mall.

More Than E-Commerce

The first thing [businesses] would be considering is an omni-channel approach. That is, sell across many different channels. The way you do that is you could have your own online store, you could set up anything from pop-up shops to a full-blown physical store. You could go to expos, you could sell through online marketplaces like Bidorbuy, or on social media like Facebook, in America you can already sell through Instagram and Pinterest.

Have A Marketing Strategy

I would advice on an online strategy with things like Facebook advertising, Google AdWords, to leverage those tools that are available to market your business. I’d also strongly recommend a complementary e-mail marketing, where they run their own e-mail marketing campaigns where they build up their customer-base that they can market to directly.

Ultimately the best marketing you can do is word-of-mouth, when someone tells their friends or people about your business. The best way to get that is that they need to focus on building excellent customer service.