Customers are competitors in E-commerce Industry in Nigeria Africa
Increasingly, eTailers are using marketplaces such as Jumia to reach more customers and grow their revenues. Only two percent are not using a marketplace, while 81 percent get more than 41 percent of their eCommerce revenue via an online marketplace. Our research showed a positive correlation between the use of online marketplaces and the eTailers’ sales growth but only to some extent. Indeed, a majority of eTailers relying on marketplaces for more than 51 percent of their sales have seen their sales declining or remaining stable.
However, marketplaces are no longer satisfied with intermediary sales and are increasingly building delivery capabilities. Some 36 percent of eTailers are already using marketplaces to manage order fulfillment.
This puts delivery companies in competition with the likes of Jumia—a daunting challenge for any business. Over the past year, Amazon has ramped up the formation of its own global delivery network, leasing 40 freight planes and purchasing thousands of truck trailers.5 Each move underlines the impending competitive threat this represents, particularly considering close to three quarters (72 percent) of eTailers we surveyed in 8 countries use Jumia to sell their products. Jumia’s stated objective, according to CFO Brian Olsavsky, is to: “add more of our own capacity to supplement our carriers and our partners.”6 But the pace and extent of recent moves suggest Amazon will ultimately establish a global logistics and delivery network to cover its entire supply chain.7 It would then not only bypass current partners, but potentially become a direct competitor, o‑ering integrated global delivery services to the whole market.
81% of eTailers get more than 41 percent of their eCommerce revenue via an online marketplace. 51% of eTailers relying on marketplaces for more than 80 percent of their sales have seen their sales declining or remaining stable.