Electronic commerce (e-commerce) is gradually
changing the face of marketing, especially in
Nigeria – one of the late bloomers coming into
the world of internet marketing.
Gone are the days when a market is defined as a
“static” place where buyers and sellers meet
directly to trade goods and services. E-
commerce has redefined the marketing
transaction process to involve a wider and
diverse audience on a global scale (beyond your
proximity) as both the buyers and sellers do not
have to be physically present before transactions
are made.
By definition, e-commerce or online shopping, as
it is often called, involves the purchase of
products and services from a seller over the
Internet.
In Nigeria, Africa’s largest economy and
population of about 170 million people, e-
commerce is gradually taking over the market
space, replacing physical stores and malls.
Compared to what we have at the turn of this
century when only few people knew about the
Internet and the advantage it possesses, the
introduction and ubiquity of smartphones and the
increasing internet penetration has continued to
help usher in innovative business ideas such as
e-commerce.
The possibilities and the opportunities presented
by this new form of marketing are incredible and
all-encompassing.
Since e-commerce was introduced in Nigeria, it
has brought about innovative and existng
business deals that are now changing the
conduct of everyday trade. It has been used to
sell fashion products, mobile phones and
services such as restaurants and spa deals.
The growth of the online shopping sector in the
country is directly linked to increased access to
the Internet. It is not surprising that when the
world started taking a good look at investment
opportunities in Africa, Nigeria was one of the
major markets they set their eyes on.
The evidences are in the expansion and
launching of smart technology gadgets by
multinational technology companies like Tecno,
Samsung and Microsoft.

E-COMMERCE AND THE NIGERIAN CONSUMER
MARKET

While the number of those shopping online are
still low, compared with those shopping offline,
prospects and statistics show that e-commerce
may take over Nigerian market place in the
future.
In Lagos where there are at least 17 million
people (about the size of Kenya, which has more
than 10 shopping malls), there are less than six
shopping malls. In Nigeria, there are about 25.
While investors such as Shoprite continue to
expand their business in Nigeria, the competition
is likely to shift quickly from shopping mall
versus formal retail market to e-commerce
versus shopping mall, at least if today’s
entrepreneur wants to meet the needs of the
growing tech-savvy generation.
A recent survey by Philips Consulting, a business
management and consulting firm in Nigeria,
revealed that 38 per cent of Nigerians who make
up the growing middle class in Nigeria prefers to
buy products through the Internet. This bulk of
people, it said, spend about $2m per week and
as much as $1.3bn on internet purchases
monthly.
Global consulting firm, McKinsey, predicts that
Nigeria’s large consumer market will be valued at
$1.4 trillion by 2030.
Based on an expanding consumer class in
Nigeria, McKinsey projects that consumption
could more than triple, rising from $388bn a year
today to $1.4 trillion a year in 2030, an annual
increase of about 8 per cent.
It also projected a growth rate of roughly 7.1 per
cent per year through 2030, a feat that could
raise the country’s total GDP to more than $1.6
trillion, making Nigeria a top-20 global economy,
with a larger economy than the Netherlands,
Thailand, or Malaysia in 2030.
WHY E-COMMERCE WILL TAKE OVER
A decade ago, the prospect of online marketing
seemed anomalous in Nigeria given the low
internet and broadband penetration.
Today, the story has changed, summarily due to
growing internet penetration. Digitxplus, a
company that deals with market research and
statistics, says Nigeria recorded a 200 per cent
growth in internet users between 2009 and 2013.
The introductions of tech hubs such as CcHuB
and SPARKs have also aided the growth of
technological services for everyday needs in the
country.
In 2012, Rocket Internet, backed by Swedish
investment firm Kinnevik launched Jumia,
today’s leading on-line market place in Nigeria
and its largest e-commerce operation in Africa.
Rocket Internet has launched other franchise in
Nigeria after that. This includes Easytaxi, a
smartphone-powered taxi hiring service; Carmudi,
an online automobile marketplace; and Jovago a
hotel booking portal.
These businesses are gradually becoming multi-
million dollar businesses.
International e-commerce payment and money
transfer platforms like PayPal and MasterCard
ignored internet-related challenges such as cyber
crime to launch in Nigeria in the first half of this
year.
Some banks in Nigeria have even launched e-
commerce portal for small businesses. An
example is First Banks’s social e-commerce
portal and Guaranty Trust Bank’s ‘The SME
MarketHub’, which enable Nigerian entrepreneurs
migrate their business online and take advantage
of the vast international and local scale of
opportunities.
E-COMMERCE AND THE FUTURE
Today. internet penetration is growing faster and
there are hundreds of new Nigerian online stores
in the cyberspace.
While many of these online businesses still face
several challenges, such as availability of
nationwide delivery system, under-stocked items,
consistency in wide variety of products and
services, poor customer service culture and
issues of internet security and fraud, the
traditional physical market, it seems, may no
longer be able to sustain the increasingly
sophisticated and tech-savvy shoppers in Nigeria.
This is because the growth of internet
penetration has created a silver lining for
entrepreneurs to launch their businesses online.
Broadband expansion, increasing spread of the
internet to rural communities, changes in
population statistics and a growing middle class
will continue to change the lifestyles of the
Nigerian consumer; and e-commerce, in the
nearest future, will not change not only the way
trade is conducted but also the way other
marketing systems operates, including producer
and consumer relationship.