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Amazing things are happening in Nigeria’s online shopping stores. Market competition among the operators, especially the big players, appears to have taken a new turn. Imagine a customer ordering an item on Konga.com and the item is delivered by Jumia.
This happened recently when I personally placed an order for a phone, iNote Prime IT1701 Tablet – Quad, on Konga.com and Jumia, another online shopping company delivered the item to me. It is not clear how this works between them, but instead of competition, this model appears like Jumia is leveraging Konga’s customer base marketplace model.
After placing the order which was validated by Konga through an e-mail, I later received a call from an individual – whom I believe works with Jumia – confirming the placement of the order on Konga but I was told that Jumia will deliver the item. This was quite strange because I had ordered for the item through http://www.konga.com/first-electronics.
When I wanted to know how my Konga order got into Jumia hand, the caller said the delivery agent will explain on delivery. Few minutes later, another call came from Jumia telling me that I had just placed an order on Jumia. I tried to correct the caller that the order was placed on Konga and not Jumia. The caller emphatically said that she received orders from me on the item. I repeatedly told her that I did not place any order on Jumia.
I had placed the order on Konga.com on Wednesday, July 29, 2015 and the item was delivered on August 3, 2015. On arrival to deliver the item, the dispatch officer, Sunday Eyang from Jumia could not explain why the item placed on Konga was delivered by Jumia. “I am just a dispatch person. I am working for Jumia and not Konga”, he told me in my office.
It is still not clear to me why Jumia delivered the item I placed on Konga.com but it could be that Jumia is perhaps leveraging the Self-fulfill delivery model Konga recently made available to sellers on its platform. Then, could it be that Jumia’s sales agents had pre- registered as sellers on Konga.com? Because I could not understand why I ordered for a phone (i Note prime tablet phone), and my order was delivered by Jumia. Do Jumia sales agents think that customers who order for an item online are undiscerning and ignorant, to the extent that the customer won’t know the difference between Konga and Jumia? Or how else does one explain this twist?
Under the Self Fulfill model introduced about a year ago, about 20 percent of the products on Konga website are retailed by Konga directly while 80 percent of other products are third party sellers. A seller of any product can be registered on the platform on Konga.com. The third-party-sellers warehouse their products and when order from consumers comes through Konga website, the particular seller takes it up, engages in the transaction, concludes the deal and delivers the goods. Today, Konga has registered over 25,000 Merchants who have listed items for sale in their stores on Konga’s marketplace. Self-fulfill is a recent development which was launched when Konga’s marketplace opened up to sellers in other states across Nigeria.
The Self Fulfill initiative which may define the future of e-commerce business was introduced by Konga to assist some retailers with brick and mortar shops to reach more customers through the Konga platform. With Self-fulfill, Merchants with stores on Konga can choose to deliver items ordered on their Konga stores by themselves or through any courier method of their choice.
Konga’s self fulfill model is similar to Airbnb, a website for people to rent out lodging. It is headquartered in San Francisco, California USA. According to sources, Airbnb runs on a marketplace platform model where it connects hosts and travelers and enables transactions without owning any rooms itself. “Such platforms disrupt traditional industries by creating new sources of supply and relying on curation for developing quality. Unlike traditional hotels, Airbnb scales not by scaling inventory but by increasing the hosts and travelers and matching them with each other,” Wikipedia said. The firm, founded in August 2008, has over one million listings in 34,000 cities and 190 countries.
Alibaba Group Holding Limited , a Chinese e-commerce company that provides consumer-to-consumer, business-to-consumer and business-to-business sales services via web portals also runs similar model.
When I sought for explanations from Jumia on what could have happened why Jumia delivered the order placed on Konga.com, the CEO of Jumia, Jeremy Doutte simply said through an email inquiry that Jumia does not collaborate with Konga. He said he did not trust the story of the customer.
On the other hand, when I reached out to Konga’s management, the Head of PR and Brand Management, Olatomiwa Akande said via email, “We do not find this development to be entirely unexpected. It is however humbling that another player in the Nigerian ecommerce sector considered it a wise business move to open a store on Konga’s marketplace platform. We see it as a validation of our marketplace model. It puts our customers at the top, as the more sellers we have, the more variety and choices they are presented with and the more likely it is that they find the best prices on Konga. This is all in line with the advancement of our company’s mission, ‘To be the engine of trade and commerce in Africa’. Our marketplace is open and inclusive to any serious seller that is willing to seize the business growth opportunities opened up by Konga’s wide reach and our teeming customer base.”
Nigeria’s online market space may witness more business disruptions as more players enter the market with different niches to serve the consumers. As Nigeria moves to entrench a cashless economy, experts say that Nigeria’s electronic commerce market has a potential value of $10 billion with about 300,000 online orders currently being made on daily basis.
As at last year, e-commerce market in Nigeria, according to the government, has attracted $200 million foreign investment with about 36 per cent of the country’s 170 million people connected online.
“The Nigerian e-commerce market has created over 12,000 jobs since 2012, expanding the infrastructure, warehousing, advertising and logistics services industry. Increased internet use could propel Nigeria private consumption almost 13 times high from $12 billion to $154 billion by 2025” , former minister of Communication, Omobola Johnson said in December last year.
Similarly, Phillip Consulting, a business and management consulting company said in a recent survey that online stores in Nigeria recorded over $2 million worth of transactions per week, approximately N1.3 billion per month, from about 38 percent of Nigerians that prefer to buy items through online. According to the survey, top items often purchased through online stores include fashion products, mobile phones and, services including restaurants and spa deals. Though Doutte is still doubtful of the story that Jumia delivered the item I placed on Konga but such interesting development appears healthy for the consumer. Leveraging Konga’s Self Fufill initiative by more online shops will however underscore the imperative of convenience which Online shopping has as character.
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