The original report was published by Stitch. You can find it here.
In December 2023, we surveyed 350+ South African consumers across various income groups, locations and ages, to better understand their e-commerce shopping habits, preferences and perceptions.
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E-commerce continues to grow across South Africa. Whether shopping for groceries or household appliances, consumers are increasingly becoming more comfortable going online to find items and make a purchase. Today, more South Africans across income levels are spending more money, more frequently, online, on a wider range of goods.
This shift has happened quickly, as a little over a decade ago just more than half of South Africans had a bank account. Contributing factors beyond financial inclusion, including the proliferation of new, more accessible digital payment methods, including e-wallets, have sparked unprecedented growth.
The rise has been particularly acute since COVID-19, when restrictions placed on traditional retail outlets resulted in a 30% drop in in-store shopping. As a result, South Africans began turning toward home delivery vs shopping in stores. And it hasn’t slowed since. Today, the market is expected to grow at a CAGR of 12.5% from 2022 – 2027, with some financial leaders predicting a continued surge to a value of R225 billion by 2025.
In December 2023, we surveyed 350+ South African consumers across various income groups, locations and ages, to better understand their e-commerce shopping habits, preferences and perceptions, and how they view the world that’s changing around them.
We’ve outlined our findings in the report below.
Recent research from Statista indicated the penetration rate of e-commerce in South Africa is at around 49% and is forecasted to grow to 60% by 2028. We surveyed individuals that have made a purchase online in the last six months and found that those who do shop online are doing so frequently, and across categories.
The rules for e-commerce are slightly different than they are in the offline world. Customers have different considerations when choosing one e-commerce provider over another. While in brick and mortar retail, proximity is usually a major factor, in online commerce, consumers want a fast and secure payment experience.
This likely stems from the fact that e-commerce is still relatively new – people are still building trust in it – but it has important implications for merchants who are working to attract and retain customers in a competitive landscape.
Credit and debit cards are still the favourite payment method for customers shopping online – which is unsurprising given their desire for ease and security. However, we found that a variety of alternative payment methods are rapidly gaining momentum, with Pay by bank maintaining a strong second position, and Capitec Pay making fast inroads.
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© 2024 Calleo Solutions (Pty) Ltd. All Rights Reserved.