An Amazing Decade with Jumia: Playing the Amazon Role in Africa for 10 Years
Trade improvement has been a necessity for economies, especially as it informs the financial efficiency of the economy. However, tech has been used to acceleration of trade through e-commerce. Pan-African e-commerce giant has verifiably done the most in facilitating e-commerce in Africa. As Africans integrate the building blocks required for the growth of e-commerce, Jumia has thrived in this way.
Online shopping in Africa increased annually, at an average growth rate of 18%, higher than the global average of 12% between 2014-2018. The pandemic had also aided the development of e-commerce in Africa. The resulting lockdowns resulted in a spike in the use of e-commerce platforms, as it became more of a need than a pleasure to shop online. As a result, Africa’s e-commerce market was estimated to be worth $20 billion in 2020.
For a major player like Jumia, the development of e-commerce enables them broaden their geographic reach to reach more customers, while buyers have more options to pick from. With more options, they can get more value for cash and shop whenever it is convenient for them.
Tunde Kehinde and Raphael Afaedor launched Jumia in Lagos in 2012 with Rocket Internet backing. It now operates multiple online verticals in 14 African countries.
When Jumia first launched in 2012, it aimed to become Africa’s e-commerce giant. In the years that followed, the firm achieved it. Jumia has been able to grow its inventory base, covering gadgets and electronics, fashion, beauty and childcare. In essence, the e-commerce firm wants to be able to sell anything anyone wanted to buy.
Some Notable Achievements from Jumia
In the first decade of its existence, Jumia has put up structures to enable swift trade for customers. Customers’ online payment difficulties have lessened via the introduction of JumiaPay. The in-house payments service was responsible for 34.1% of Jumia’s orders in the third quarter of 2020. Jumia also established 1,300 drop-off and pick-up stations to help with last-mile delivery issues, as well as a network of over 300 courier partners and unique technology for tracking optimal delivery routes and inventories.
Jumia is known for collaborating with companies and organizations in order to provide better prices to their clients. P&G, Reckitt Benckiser, Mastercard, IrokoTV, and Coca-Cola are among the companies that have formed agreements to supply citizens with hygienic and important items.
JumiaPay partners with Egypt’s National Bank to provide business payment services
Over the years, Jumia has created space for MSMEs to thrive, and the company’s economic growth has been spectacular. Jumia continually invests in physical and network infrastructure as well as labor, and as a result, it continues to be a vital contributor to Nigeria’s and Africa’s economic growth. The e-commerce giant is easily seeing to the employment of over 5000 Africans. Several MSMEs and startups were able to survive instead of completely shutting down operations due to Jumia’s promotion of adopting online shopping, logistics, digital payment, and supply value chain.
Certain variables have led to the establishment of Jumia as the e-commerce giant they are today:
Mobile Phone Penetration in Africa
In recent years, Africa’s telecommunications and mobile business have seen substantial growth. Africa is experiencing rapid increase in mobile connections, with the continent already having the second-largest number in the world.
Furthermore, the percentage of 3G and 4G mobile coverage has expanded significantly over the last few years, while the share of 2G has decreased, and a rapid transition to more sophisticated technologies is projected—this could be Starlink. For example, in Africa, the percentage of mobile connections using 4G technology was expected to climb from 5% in 2019 to 21% in 2025. These enormous increases in the number of mobile users as well as the quality of the technology used are a big advantage for Jumia’s development in Africa.
What Should Africans Expect from Starlink?
The growing interest in shopping convenience through mobile phone has prompted Jumia’s growth. What Jumia offers is the facilitation of electronic monitoring and integration to improve participation. Jumia+ mobile phone makes commerce more efficient and helps to improve people’s well-being by reducing both distances and information cost.
Financial Inclusion
The participation of the financial sector has contributed to the growth of Jumia. The penetration of mobile devices in Africa has been accompanied by the rapid growth of financial inclusion through Fintechs and commercial banks. Increased financial inclusion has created operational benefits for Jumia, charging them to meet the commercial needs of Africans.
While it is advised that customers use JumiaPay as preferred payment option, Jumia also accepts other popular mobile money options for payments, including MTM Mobile Money, Orange Money, M-Pesa, and Tigo Cash.
Expecting Another Decade of Excellence from Jumia
It’s pleasing to know that e-commerce is still 2-5% of total retail in Africa in spite of Jumia’s strides. The company is yet to cover a good percentage of retail in Africa. Jumia and other e-commerce startups in Africa still have grounds yet uncovered.
Jumia Nigeria Chairwoman, Juliet Anammah had stated that Jumia hopes to close the gap by expanding footprints in its current verticals.
“All said and done, we are the largest e-commerce platform on the continent. A continent where e-commerce is still 2-5% of total retail, which is a huge upside.
This is a huge area to focus on rather than look into new verticals. Now we are deepening our footprints within the countries we are in, and concentrating on them for now,” said Anammah.