In a country where the potential of the e-commerce industry is comparatively
low, Jumia Kenya seems to be breaking the online shopping ceiling one click at
a time. Parinaz Firozi, Jumia Kenya Managing Director says the online retailer
grew orders by a 900 percent in 2014 by understanding and adapting to the
needs of Kenyan customers and aggressive marketing.
Statistics released by the Communications Authority in June 2014 show Kenya’s
e-commerce is worth Sh4.3 Billion compared to South Africa’s Sh54 Billion. The
CA cites high custom duty and taxes paid on imports and inadequate
cybersecurity systems as major impediments to the growth of e-commerce in the
country.
These are issues Firozi understands too well as several multinational online
retailers have not attracted sufficient numbers to penetrate Africa.
“When we entered the Kenyan market in 2013, we realized there were many
hurdles we had to overcome. The Kenyan consumer is generally either unbanked
or underbanked. For those who have credit or debit cards, they do not want to
reveal their bank account details on a platform they have not used before,”
says Firozi.
Firozi adds understanding the Kenyan consumer has helped Jumia rapidly scale
to be the biggest retailer in the country with over 100,000 different
products.
The surge in e-commerce also corresponds with a growing tech-savvy middle-
class and an increase in the number of internet users in Africa. Firozi says
slow uptake of e-commerce in Africa has never been an issue of demand.
“There has been a supply issue brought because there is no proper
infrastructure to supply customers with what they want,” explains Firozi.
With a presence in 13 countries and 3000 employees across Africa, Jumia is
unlocking the e-commerce industry in Sub-Saharan Africa by offering variety
and favorable pricing. According to Firozi, adapting to the needs of consumers
has been critical to increasing sales.
“Jumia provided an opportunity for shoppers to pay cash or M-Pesa on delivery
and today this accounts for a majority of our transactions. These were the
real factors that helped us scale to the extent we did. We understood what the
customer wanted and provided the solution,” explains Firozi.
In addition to building its own delivery fleet, Jumia’s return policy – where
purchased goods can be returned within 7 days at no charge – has helped win
the trust of customers, three-quarters of which are between 25-45 years.
Firozi says Kenyan consumers are smart shoppers who are brand conscious and
also price sensitive.
“A majority of our customers look for the best deal before they decide what to
buy.”
With the aim of expanding their products, Jumia is positioning itself to be a
launch pad for international brands entering Africa. The online retailer is in
partnership with Microsoft and two other mobile brands to sell selected
handsets via their web platform.