By Alexander Chiejina
- Nigerian ecommerce market to experience growth and revenue 2023 onwards
The $5.3 trillion eCommerce market will continue to grow quickly, according to new research from Juniper Research, a leading authority on payments. This growth will be fueled by rising usage in developed economies and considerable uptake in emerging areas.
As online retail continues to surpass traditional brick-and-mortar stores, new and developing payment methods will make the online market far more accessible, opening a wide range of vendor prospects, the report says, adding that an eCommerce payment system takes online electronic payments with the goal of giving the customer the best experience possible with the least amount of hassle.
The report further advised that eCommerce businesses must provide their clients with the most alluring payment alternatives given the wide range of payment options now available to consumers. Merchants must deliberately choose which payment choices best support their aims, such as BNPL (Buy Now Pay Later), to raise average order value, given the cost and difficulty of integrating numerous payment options.
“Ecommerce providers must understand their customer bases to a greater extent; offering the payment options customers want and removing undesirable options,” said Cara Malone, the study’s author. This entails utilising eCommerce payment solutions that not only comprehend and accept the most typical payment options in any nation, but also consider how these differ by industry and target market. Knowing this can greatly enhance the payment experience.
The research exhorts eCommerce payment providers to give their smaller SME clients access to dashboards and data visualisations. SMEs do not currently have access to good customer analytics, which might highlight consumer purchase patterns and reveal information about popular payment methods and fraud. eCommerce payment providers can distinguish their portfolios in a market that is becoming more competitive and commoditized by providing extra services to SMEs.
These predictions coincide with the ecommerceDB and Statista Market Insights predictions that the Nigerian ecommerce market will have favourable growth and revenue expansion beginning in 2023. In 2022, the sector underwent a sharp decline of about -15%; this was in line with the global trend of eCommerce regression brought on by changes in the world’s markets and finances.
However, it is anticipated that the country’s online retail sector would rebound, with growth rates rising to 25.5% and revenue reaching US$ 7,627 million in 2023, making it the 39th largest market for eCommerce globally, ahead of Israel.
The youth population in Nigeria is expanding, and they now have better access to cellphones and more disposable income. These elements contribute to the growth of the nation’s eCommerce sector. Therefore, it is predicted that Nigerian eCommerce will experience a promising 11.3% compound annual growth rate (CAGR 2023-2027).
Electronics & media, which account for 39.3% of all online sales income in Nigeria, is the most popular category within the larger eCommerce industry. With 22.3% of the vote, #fashion is in second place, followed by #furniture & appliances with 15.7%.