We’ve all heard the news. Yes, Amazon is soon to hit the shores of South Africa.
Having received the go-ahead to continue the construction of its headquarters in Cape Town, Amazon is moving quickly, having already opened registrations for local merchants. With the ball rolling, and rolling fast, there have been mixed emotions among South African retailers, both big and small.
While Takealot’s CEO, Mamongae Mahlare, claims Takealot is ready to welcome the global giant, there is no doubt that this long-standing e-tailer has some concerns about its stance in the market. Not only has it faced financial instability over the past few years, but CompCom has also reported its unethical practices–factors that may have bigger repercussions than Nasper came to expect.
Will Takealot’s strong local presence, extensive knowledge of our market and loyal pool of customers come to its defence, or will Amazon’s global reach, vast product inventory and competitive pricing tip the scales?
Initial fears also surfaced among our smaller eCommerce players, and rightfully so. With two retail behemoths at the fingertips of every South African consumer, how can they compete?
While these concerns are valid, Amazon’s interest in South Africa only substantiates the potential of our local market. Today, SA has contributed to 10.4% of the worldwide growth of the eCommerce sector, which is expected to grow to 12.3% by the end of 2024. Additionally, we can look forward to a stronger economy, not only through the promise of greater employment opportunities but also a more equal playing field for retailers to compete in.
At the end of the day, Amazon's arrival and its impact on local sellers depend entirely on the sellers themselves. This is where it gets interesting for digital marketing.
Considering Amazon's strong online presence, convenient shopping experiences and the value it offers, eCommerce stores need to take a good look at their current digital strategies and be willing to adapt and innovate with the times.
1. Enhancing customer experiences
From the relationships you build on social media to the quality of your after-sales service, the experience you’re offering your customers at every touch point will be the leading decision influencer in a customer buying from you or your competitors.
Customers no longer buy products solely based on their price. With so many options available, customers buy the value you're selling. That value manifests in inherently understanding what your customers want and need, creating seamless online stores, improving customer service standards and establishing personalised offerings that drive them from discovery to purchase.
2. Bolstering your online presence
Under the umbrella of better customer experiences, your online presence is a key consideration in a growing competitive landscape. At a time like this, it will be critical for eCommerce stores to leverage social media to seek out new customers, connect with current customers and strengthen relationships with both.
Whether through entertaining, inspiring or educational content, effective paid advertising, or rapid customer service, social media is the leading environment where strong and authentic relationships are forged. It’s these relationships that will turn customers into loyal fans.
3. Offering value beyond price
As previously mentioned, the value of a product often outweighs its price tag in influencing a customer’s purchasing decision. That’s why e-tailers must focus on offering value, and value beyond mere discounts.
Exclusive product bundles, complementary items, and limited-time promotions create perceived value, incentivising purchases. Loyalty rewards programs encourage repeat purchases and foster a sense of appreciation among customers. Finally, incorporating value-added services such as free shipping, extended warranties, or hassle-free returns contributes to better customer experiences, instilling confidence and trust in the brand.
By prioritising value over discounts, eCommerce players can forge deeper connections with customers, driving repeat business and establishing themselves as trusted leaders in the competitive retail landscape.
To conclude
The news of Amazon’s impending arrival to South African shores has certainly stirred a range of emotions. Established players like Takealot face the challenge of defending their place in the market, while smaller eCommerce businesses fear being overshadowed.
Yet, we must consider that while competition may intensify, so will opportunity, and the online space will be the golden ticket for retailers willing to embrace it.
We stand on the brink of a new era in retail dynamics, where adaptability and innovation will be key to continued success. In the face of this new and heightened competition, connecting back to better customer service, enhancing online experiences, and strengthening their value propositions are some of the many ways online retailers can maintain their foothold in the market.