Online marketplace is a space in which businesses gather in one highly accessible platform for the prospective customers. In current era when the internet becomes an essential part of human life, the role of online marketplace in economic sector cannot be undermined any longer. An online marketplace provides some advantages that traditional market does not. For instance, it enables small businesses to reach bigger target market. It is because these businesses can advertise their products at lower cost through the automated system. Customers will be able to find products that they need only in one platform instead of having to access multiple platforms.

In Africa

the online marketplace realm is growing rapidly as it is in other parts of the world. It even thrives in areas that are remote. The technology has reached even some of the most hidden communities. In the places where the people are unable to access certain products, online marketplace is very helpful. These people will be able to obtain goods easier without having to go to other places far from their locations. Of course, there are still some issues with delivery because Africa is really vast and in some parts, the infrastructures are not well developed.

To deal with such situation

online marketplace must provide easy methods of correspondence to accommodate their bola 88 target market. Good correspondence system will improve the customers’ experiences in the marketplace. The chance for them to re-utilize the marketplace for their bidding will be increased exponentially. It actually supports the economic system greatly because the economy depends on how active the market is.

The most ideal correspondence would be utilizing live chat system. This type of correspondence enables customers to contact the platform and receive immediate response to their shopping issues. However, this system certainly requires plenty of resources to develop. The marketplace needs to find experienced customer service team that can handle varied ranges of customers. Its platform system also needs to prepare big size data storage space. There are also conditions in which the platform’s chatting feature does not have friendly interface. At the end, users are not likely to use difficult chatting system for correspondence.

Another method of correspondence that can be used is by ticket

It means that the customers will fill in form to submit their problems to the customer support team. This method is simpler because the customer support has more lax time constraint in answering these reports. However, in some cases, the ticket form is often only accessible from computer desktop. This is certainly difficult because not all people have desktop computer or laptop. Thus, the marketplace must work to provide mobile friendly customer support interface for its customers.

Traditional correspondence method like phone call should not be disregarded either. It is important to still provide this mode because some people might not be savvy with technology, particularly the older generations.

The economic growth trends in Sub – Sahara Africa have attracted many businesses to take a role in this continent’s market potential. Since the digital technology is growing fast worldwide, online transactions become one of the new lifestyle not only for Western people, but also Africans.

Online marketplaces expansion in Africa, although their existances are not as many as in the other developing countries. But they are projected to have potential growth in the future.

The Role of Advertising to Consumer Behavior

Some studies show that advertising products in several Africa countries have significant impact to rise certain brand awareness. In order to make the advertising efforts from companies to be successful the companies have to implement right strategies.

The Condition of Internet Penetration and Its Impact toward Marketplace Businesses

Like most of the developing countries, Africa still has to deal with the lack of internet access. The average percentage number of people in Africa who have already some form of internet access is only 40% and it is dominated from urban parts of Africa.

Kenya is the country in Africa that has highest internet accessibility with more than 80% people who live in the cities already have access toward internet. Meanwhile, the number will drop significantly when people from rural areas of Africa take into account.

The group of people in Africa who have internet access is dominated by higher household income. Although there are still many poor people get the ways to connect to the internet.

Up to 90% of Africans who have access to internet are using smartphone as their devices. The type of connections are mostly 3G network. Therefore, companies who want to develop their online marketplaces here, need to consider the speed of 3G connections toward their website and e – commerce design.

Consumer Behavior in Africa

Millenials are the group of people in Africa who actively using the internet. Almost three – quarters of internet users in several Africa countries such as Uganda and Algeria are dominated by young generations. Therefore, the emerging growth of e – commerces in Africa are targeting young generation.

But, most of these youngsters are using internet to get information about the products they want to shop offline. For example, if they want to shop certain footwear, they will look for the price information and product specifications first through internet before going to the retail stores.

Most Africans prefer to shop in traditional retail channels such as kiosk, general stores, markets, street hawkers and so on. Even the number of people who visit traditional retail channels are four times higher than the number of people who visit modern channels.

But of course

it does not mean that there is no future for online marketplaces in this continent. There are several indigenous players who successfully gain many attention from people.

World Bank forecast the economic growths in some countries have increased greatly. There are several reasons why the economy has grown so fast. As you know, Africa is known for its poor countries. Middle-class expansion, friendly market business, and also rapid urbanization have changed the business trends in the region.

Countries’ government across Africa has realized that the small and medium sector of business can be used as a source of job creation and economic growth. Some major countries even make everything easier for the entrepreneur to run a business. Some digital tools are also utilized these days. Now people in Africa familiarize themselves with some digital tools available in the marketplace where they can operate some streamline or online processes like opening a bank account for business, tax submission, registering a brand new business and etc.

Digital tools used to be very expensive in Africa especially for small businesses. On the contrary, people are easily able to access the internet to gain their business. Things like data entry, email marketing, customer service, and accounting make everything is easy. Nowadays, people use their phones as their gateway to information and knowledge from posting something on social media, complaining about things, buying online tickets, writing reviews, and many others. There are huge populations that make use of the internet in Africa. This is a business trend that should be utilized.

Africa is known for its large quantity of resources in both mineral resources and agriculture. Africa has struggled from transforming these resources into persistent economic development. New investments and innovations change and create an exciting occasion for business. Nigeria is considered the largest marketplace in the continent as it has a large population. Foreign investment is also growing rapidly mainly in resources sectors. The country is known for its power deficiency makes it a great opportunity for business.

Skeptical about online retail

On the other hand, internet business reality in Africa diverges from what is accessible in the western world. The optimism clouds some noticeable challenges in the continent to deal with. That’s why internet commerce is not profitable.

Many Africans are still skeptical about buying things online. They prefer buying things offline which is easy for them to choose items cautiously. On the contrary, people in Africa are enjoying the growth of the internet as they can access the web easily. With the high cost of bandwidth, internet business in Africa is challenging.

Logistic restriction

Since internet business needs delivery through the postal system, most countries in Africa only utilizing motorbike to deliver things. Of course, it will increase the cost that affects the price and selling. Literally, markets are everywhere with low prices offered and e-commerce companies have to overcome this to keep the company exists. Since many Africans cannot read and write, it is difficult to grow internet business in Africa. Low literacy capability affects the e-commerce business as everything displayed with texts and images.

Every marketplace in the world has its challenges to grow. Well challenges as a part of how marketing analytics should work, and it creates better and better strength each time. The geographical condition shall also bring impacts to marketplaces’ challenges. Southeast Asia, for instance, most challenges come to shipping, due to strict regulations in most of the countries or facts that Southeast Asia country comes in archipelagos.

But now let’s talk about Africa. What are the challenges marketplaces in Africa‘s face?

Then, what are the impacts of the challenges? What should you prepare if you were in the marketplaces’ CEO’s shoe?

Example of Marketplaces in Africa

In Africa, few local marketplaces are pretty famous and working well. One of the reasons is that they sell authentic locals’ masterpiece hand-made accessories. Africa’s hand-made woven or other authentic creations are pretty known around the world.

Those marketplaces are Jumia which operates around multiple countries in Africa, next is Kilimall which operates in Uganda, Nigeria, and also Kenya, then Konga which operates in Kenya.

The Examples of Challenges the Marketplaces Are Facing

There are so many examples of challenges the marketplaces should face. Some of them due to logistical problems. One challenge that has happened the most is the accountability of PayPal and other worldwide networks. A fact that worldwide is purchasing Africa’s authentic hand-made products but not a lot of their countries’ commercial banks are connected to Africans’. To handle that challenge, most marketplaces in Africa allow PayPal as their payment gate.

The next challenge for marketplaces in Africa includes the existence of eBay and Alibaba. Those two gigantic marketplaces have a huge power of the market in Africa among the Africans themselves. And because they are bigger, guarantee more items and products, and also likely have better distribution capabilities, the other marketplaces (such as Jumia, Kilimall, Konga, and others) should do regular development and evolve.

Talking about the better distribution of eBay and Alibaba

the next challenge of African marketplaces is the effectiveness of the distribution. As distribution is a crucial part of order-fulfillment, it is very crucial for marketplaces to make sure their distribution to the customers does not take too much time for the products to arrive.

Still talking about distribution and payment, the next challenge is cash-on-delivery payment. Impacted by the rush distribution across Africa, and also the marketplace should consider the additional costs for the cash-on-delivery payment services.

The next challenge is the high rate of return and refund possibilities in Africa. In some marketplaces even have more than 10.0% of refund and return demand from the customers for pretty various reasons. This is likely the last more crucial or happens in Africa. Meanwhile, the other challenges that were not mentioned before are pretty occasionally.

Are There Other Crippling Risks for African’s Marketplaces?

Yes, risks such as cultural, societal challenges, currency risks, and human resources are also common for the African marketplace. But we know that these risks are always stuck to every marketplace from around the world, and not necessarily only in Africa.