The rise of e-commerce and social interaction selling in South Africa


This is the result of the second annual PayFast e-commerce performance index (PEP). Launched on Tuesday, the index provides a snapshot of the e-commerce landscape to 2022.

“Despite a difficult year, 48% of merchants saw their revenue increase, driven by a 50% increase in online sales,” comments Colleen Harrison, Marketing Manager at PayFast.

Changing consumption habits

Consumer habits have irrevocably changed in the long run as the pandemic and the lockdown have forced consumers to adopt new shopping behaviors outside of their comfort zone.

The result is an increase in online shopping and the adaptation of new payment methods, which have not calmed down, but have instead continued to develop.

Black friday

With Black Friday on the horizon, online traders are feeling optimistic. The total average basket size for Black Friday 2020 was Rand 1,243.

“This is a 55% increase in the average basket size compared to the rest of the year and the total payment volume increased by 47%, while the total number of transactions increased by 57% “said Harrison.

Speaking at the launch of the Index, Bronwyn Williams, marketer, trend researcher and writer at Flux Trends, said: “Black Friday shouldn’t be seen as a day but as a week.

“Black Friday sees payment volumes start increasing already on Monday, gradually increasing to peak on Friday, then decreasing on weekends and increasing again on Monday. Traders should also consider when the payday falls during this period. ”

The retail apocalypse

The global retail apocalypse that began in 2010 has hit South Africa, Williams says.

“Although we have the eighth largest mall, we are not the eighth largest economy. Our ‘build now, pay later’ policy has put office and retail space under pressure, ”she explains.

“However, the culture of the country’s shopping centers is evolving into a shopping street-type retail space with smaller boutiques.”

Additionally, as the boundaries of online and offline spaces begin to increasingly blur, ghost retail stores are emerging as online retailers want a physical retail presence.

“It gives an online retailer the opportunity to be part of a bigger world where they can provide the retailer with a surprising and tangible point of contact to reach the consumer. It also builds consumer confidence. In addition to providing a competitive advantage, it’s also a way for small online retailers to compete with Amazon, ”she explains.

Interactive social sale

One trend that is moving rapidly from east to west that early local users will soon see in South Africa is interactive social selling.

“Influencers are evolving into direct sellers, and they will be paid on the basis of a commission, not a retainer,” she says.

“With interactive social selling, the ability to live chat becomes the late-night shopping network. This is already very important in China, where luxury brands and Walmart-like products and services have already earned $ 61 billion, ”said Williams.

The 2021 edition of the PEP Index is available here.

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