Why e-commerce businesses are struggling in Nigeria

Online shopping concept. Shopping apps icons in shopping cart on laptop
Illustration by Getty

Most e-commerce businesses in Nigeria are struggling due to a large number of factors such as the size of the addressable market and logistics, economic struggles but trust issues is a major factor that consumers have identified as the main issue.

E-commerce refers to the purchase and sale of goods and services via electronic channels such as the internet. Many consumers have had unpleasant experiences such as having wrong items being sold to them, delayed in getting the item, poor quality, and poor feedback

Ifeoluwa Awosoji, a digital journalist said, “I remember when I was in the university then, I purchased a hairdryer online but I got something different.

Others that have never shopped online like Oduayo Oyasiji , a lawyer, said that experience from a friend made him never to think of buying items online

“A friend of mine purchased a piece of furniture online but when it was delivered, the quality of the item was poor. We tried to return it but they never came back to receive it. That was when I decided that I will not try shopping online,” He said

Shopping through electronic means is usually easier and more convenient as it reduces the stress of going from place to place to shop for an item.

Ademola Asunloye, a researcher said that he shops online because it is convenient for him but on specific items. “I shop for phones and laptops. I don’t buy clothes, jewelleries, and shoes because I don’t trust the quality. Most of the pictures you see online are phone shopped.” Asunloye added

Last year, Konga, one of Nigeria’s leading e-commerce companies, was acquired by Zinox, a local tech firm which manufactures and distributes computers and also manages data centers. Konga struggles first appeared in 2017 when it cut nearly 60 percent of its staff. And also that same year OLX, an online marketplace owned by Naspers, a global internet and entertainment group shut down its offices in Nigeria.

Additionally, Ringier, the African subsidiary of Swiss media and e-commerce company acquired DealDey , a Nigerian online shopping start-up for an undisclosed amount in 2016

And now in March 2019, there are indications that Naspers will be shutting down yet another one of its companies in Nigeria, Careers24 Nigeria, which has been operating in the job-listing market since 2014.

The poor customer service and questionable return policies have seen trust deficit largely worsen among Nigerian customers. The trust deficit means that among the already small addressable market, potential customers are far more at ease shopping from international e-commerce platforms than local alternatives.


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Written by NaijaRoko

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