By Nicola Mawson
Amazon.co.za’s arrival in South Africa was a big deal, with its biggest rival, Takealot, acting immediately with special offers and marketing on X, the social media platform previously known as Twitter.
According to commentary in the Online Retail in South Africa 2024 report released earlier this week, the launch of the new online shopping portal was “probably the most momentous event in the local e-commerce industry since the launch of Checkers Sixty60 in 2020”.
Yet, Amazon.co.za must prove itself in a market dominated by Takealot, South Africa’s largest online retailer, as well as other established names such as Loot.co.za and Makro and international entrants such as Temu and Shein. World Wide Worx MD Arthur Goldstuck says Amazon.co.za will have to distinguish itself through the effective fulfilment of orders, speed of delivery, a range that exceeds competition, and its treatment of suppliers.
Adrian Schofield, an ICT veteran commentator, says Amazon will have to differentiate itself through a combination of price, quality and convenience. “Initially, I didn’t see the range of products offered by Takealot, for instance. It’s too early to tell if the delivery times and/or collection points are good enough, both are pretty consistent from Takealot, in my experience.”
What will drive purchasing decisions, nlightencx marketing specialist Mathabo Sekhonyana says, is a combination of price, brand, credibility and content. “It’s the perfect blend of all these elements.”
Sekhonyana says customers shopping on sites such as Shein and Temu, for example, worry about whether they will receive their orders, how long they will take, hidden costs, exorbitant shipping fees and return policies. “This is essentially a trust issue and speaks to a lack of established brand credibility.”
Sekhonyana says that when it comes to lacklustre service, “consumers seem to have different feelings when it comes to Amazon, largely because of the way they are viewed across the globe, with strong brand credibility and a reputation for delivering on their promise. South Africans do expect the US giant’s online offering to come at a slight premium but have the peace of mind of knowing their goods will arrive as advertised and on time.”
Yet, Schofield isn’t convinced. “Amazon has an image of deliveries being thrown onto porches (in the States) which will not go down well here.”
Amazon.co.za said, on its launch, that a selection of local and international brands across 20 product categories would be available fo same-day and next-day delivery, along with more than 3 000 pick-up points and an easy return system. In an interview between Goldstuck and Amazon managing director of sub-Saharan Africa Robert Koen Koen explained that Amazon.co.za had teamed up with DPD Laser and the Courier Guy for deliveries.
However, Schofield says he browsed through the Amazon catalogue and special offers but did not see anything he wanted, or could afford, to purchase.
Another key aspect for Amazon.co.za is offering South African businesses the opportunity to sell their products and benefit from the Amazon ecosystem that will help them grow.
Amazon.co.za has partnered with several local non-profit organisations to offer locally made items such as handmade gift bags made by gogos, as well as local brand NomakadeTM, which offers organic haircare products.
The Online Retail in South Africa 2024 report notes that Amazon.co.za “brings several thousand small retailers into the online space that were not there before or didn't have access to a significant online audience”.
Amazon aims to be a platform of choice for small businesses to easily sell their products in a seamless manner as well as aiding them in growing their business. “Building a strong relationship with South African brands and businesses – small or large – is incredibly important to us. We want Amazon.co.za to be the place where they can reach millions of customers,” Koen said.
“Today is only the start of Amazon.co.za. We will continue to improve and enhance our shopping experience to serve customers and sellers across South Africa.”
BUSINESS REPORT