Why Nigerians will spend over ₦327 billion shopping online outside Nigeria in 2016

 

“Early evidence suggests that Nigerians are well on their way to becoming some of the biggest online shoppers in Africa.” This was the prediction in September 2012.

Four years on,  with the introduction of online stores, the prediction seems to be right on point. Nigeria has been ranked by PayPal inc as the 3rd highest mobile shopping nation worldwide. Nigerians reportedly spent $610 million in 2015 using PayPal, and we are on target for $819 million (about ₦327 billion, at current rates) this year.

The General Manager of PayPal Africa and Israel, Efi Dahan, said Nigerian online shoppers have realised the world is their shopping mall and as such shop wherever and whenever using their mobile devices.

Great stuff right? Except barely two weeks ago Kinnevik released the Q2 reports of her investments and Konga, one of the indisputable eCommerce giants in Nigeria, had 184,000 active customers in a country of 180 million resulting in an estimated 45,000 active customers per year.

Similarly, Jumia was branded “one of the worst (if not worst) performer in Rocket’s group of “confirmed winners” after it was revealed that Jumia’s net revenue was valued at 37% when AIG released her Q1 report for 2016. I could go on about the incessant layoffs in the Nigerian eCommerce industry despite the huge investment funds but you know that already.

There is something else drawing my attention. If we are the 3rd highest mobile shopper worldwide why are our local stores complaining of economic downturns? Why does Konga have 184,000 customers when Nigerians spent ₦128.1 billion shopping online?

So let’s take a look at history shall we? Where did we begin? How did we run it? What went wrong?