Lifestyle and Tech had an opportunity to seat down with Tim Kiluba, the General Manager of Yassir South Africa to cover different topics. Here is the transcript of the interview where LnT stands for Lifestyle and Tech and TK for Tim Kiluba
LnT: Thank you for joining us today, Tim. It’s a pleasure to have you here. Let’s dive right into it, What are some of the key industry trends you are observing in the online store industry particularly in South Africa?
TK: Thank you for having me! The future of retail is being shaped by major movements in South Africa’s online store sector. Successful merchants prioritise improving customer experiences and putting people before products, demonstrating the importance of customer centricity. With a considerable shift from physical to online buying, the number of e-commerce customers is predicted to increase by over 6 million by 2024. Due to consumers’ growing preference for smartphone buying, mobile commerce is driving this growth, making a mobile-first approach crucial. Increasing conversion rates requires safe and efficient checkout procedures in addition to reliable payment methods. Because customised experiences can result in notable profit increases, personalisation is also a game changer. Furthermore, the shopping experience is improved by sophisticated product search features that support natural language queries, and the emergence of hybrid e-commerce models draws attention to unrealised potential. Finally, the changing environment of online shopping is further demonstrated by local customer behaviour, which shows that a significant percentage of online shoppers are over 60 and demand quick gratification products with flexible delivery options.
LnT: What market are we seeing having an appetite for online shopping?
TK: According to a GeoPoll study on eCommerce in South Africa, the sector is experiencing unprecedented growth. “In 2020, South Africa’s eCommerce grew by 66% compared to the previous year. This surge was primarily driven by restrictions on traditional retail, which resulted in a 30% decline in in-store shopping. While many sectors faced challenges during lockdowns, online retailers saw a significant boost in sales as South Africans opted for home deliveries instead of visiting malls and stores. According to Stats SA, the market share of online retail in South Africa rose to 2.8% in 2020, doubling from 2018”.
To answer your questions, the South African market for internet commerce is expanding significantly, particularly in the wake of COVID-19. Since over 70% of South Africans already shop online at least once a month, the COVID-19 pandemic has further accelerated this tendency.
In South Africa, online shopping is driven predominantly by middle to upper socio-economic groups, particularly those earning between R11,263 and R32,521 per month. These consumers, who are concentrated in urban areas, have greater access to stable internet connections, electricity and digital payment options, which make online shopping more feasible. Retailers are focusing on these segments by developing customized e-commerce platforms to better serve their needs and preferences.
In contrast, townships and rural areas face barriers like poor internet infrastructure, unreliable delivery services and lower smartphone penetration, which limits the growth of online shopping. While some efforts to improve digital access are High delivery costs can discourage online shoppers, particularly for smaller purchases. In response, many platforms offer free delivery on orders above a certain threshold and provide subscription services for unlimited deliveries, making frequent shopping more cost-effective.
The lack of personalization in online shopping experiences is being addressed through the use of virtual shopping assistants and AI-driven recommendations. This helps recreate the interactive nature of in-store shopping.
Finally, to combat cybersecurity risks, retailers are implementing advanced security measures such as two-factor authentication and real-time fraud detection, ensuring customer data remains protected.
LnT: Your business is in the goods online delivery services, how should entrepreneurs particularly those from the townships look out for opportunities to join this market?
TK: Entrepreneurs from South Africa’s townships have significant opportunities to join the online delivery services market, despite the challenges posed by sector saturation. The recent surge in online businesses from townships indicates a growing acceptance of digital platforms. Services like Uber Eats showcase how local entrepreneurs can thrive by tapping into this fast-growing industry.
To succeed, it’s essential for these entrepreneurs to focus on pricing strategies. Many township businesses struggle with setting the right prices, either pricing themselves out of the market or too low to sustain profitability. Effective pricing is crucial: it should be competitive yet reflective of the costs involved. Entrepreneurs should consider leveraging public service delivery opportunities to differentiate their offerings.
Additionally, they need to avoid financing production costs out of their own pockets, which can lead to unsustainable business practices. By conducting thorough market research and understanding their customers’ needs, township entrepreneurs can identify unique niches within the online delivery market and build a sustainable, profitable business model.underway, the gap remains significant, as urban consumers benefit from more developed infrastructure that supports the e-commerce ecosystem
LnT: The festive session is around the corner, how should consumers best utilise the convenience of online shopping without breaking their bank accounts during this period?
TK: To make the most of online shopping during the festive season without overspending, consumers should focus on convenience and smart budgeting. Platforms like Yassir can help by handling the shopping for you, giving you more time to spend with your family. Instead of facing crowded malls, Yassir delivers groceries and essentials right to your doorstep, providing peace of mind during this busy time.
Many online platforms offer budget-friendly options like festive sales, bundle deals, and free delivery promotions. They also provide a wide range of products, ensuring that you can find everything from gifts to groceries without sacrificing quality or price. By using price comparison tools and taking advantage of these offers, customers can maximize their savings.
In addition to convenience, security is a significant advantage of online shopping. Reputable platforms like Yassir use strong security measures, ensuring that transactions are safe and that personal and payment information is protected. This, combined with the ease of doorstep delivery, makes online shopping an excellent choice during the festive season.
LnT: What challenges exist in this market and how can they be addressed?
TK:At Yassir, we have faced several challenges, including increasing competition and rising consumer expectations for a more seamless shopping experience. Additionally, we recognize the significant challenge that cyber and data security pose—not only for us but for the entire industry. One of the most pressing issues in eCommerce today is online identity verification, compounded by search functionality problems that can hinder user experience.
In South Africa’s suburban regions, where online shopping is gaining popularity, several unique challenges arise. These include delivery delays during peak demand periods, higher delivery costs, sustainability concerns, a lack of personalization in online shopping experiences, and elevated cybersecurity risks.
To address delivery delays, retailers such as Takealot and Woolworths are enhancing their logistics networks by partnering with more courier services and establishing localized fulfillment centers. They also offer flexible delivery options, including same-day delivery for urgent orders