DIGITAL SHIFT

E-commerce continues to disrupt retail sector in Kenya

Statista estimates that Kenya's e-commerce volumes will surge to $2billion annually by 2024

In Summary
  • Huawei recently held the sixth edition of the Unitech Talk  where experts from the private sector highlighted the impact and opportunities e-commerce presents.
  • Kenya has made significant strides with regards to digitization and creating an enabling environment for businesses and trade to flourish in the digital space.
ecommerce website
ecommerce website

E-commerce has continued to dominate in country with many players entering the industry, significantly disrupting the retail sector.

Huawei recently held the sixth edition of the Unitech Talk themed “The role of e-commerce in trading” where experts from the private sector as well as the government highlighted the impact and opportunities e-commerce presents.

Globally, e-commerce sales amounted to $4.28 trillion in 2020 according to Statista mainly attributed to lockdowns, social distancing, and the push to work from home, which meant no in-store purchases.

Statista estimates that Kenya's e-commerce volumes will surge to $2billion  annually by 2024, pushed up by increased uptake.

Kenya has made significant strides with regards to digitization and creating an enabling environment for businesses and trade to flourish.

Approximately 9 per cent of Kenyans are regular e-commerce users, with the number growing with every passing day.

Locally, the evolution of e-commerce can be attributed to the steady growth of internet penetration, which currently stands at approximately 85.2 per cent, access to mobile money with the popularity of platforms such as M-PESA, along with the growing fintech industry.

All these have radically shifted the way individuals, small and medium enterprises use and move money, thereby increasingly impacting the local e-commerce sector.

Lilian Njuguna, senior manager, Safaricom, said that in the future, M-PESA aims to be a digital lifestyle enabler and thereby serve as a backbone for e-commerce in Kenya.

With the penetration of multiple digital services, it is of utmost importance to have a population that is tech-savvy, therefore allowing them to take advantage of the opportunities presented by digitization.

For that reason, provision of ICT skills and training resources to both the young and the old takes priority.

E-commerce is one of the drivers of the growth of the local and global economy thus developing digital skills serves as an essential foundation for developing the growing sector.

Lawrence Karanja, CAS Ministry of Industrialization, Trade and Enterprise applauded Huawei for supporting government efforts to improve digital literacy by offering online lectures specifically for university students within the ICT field during the pandemic.

The Kenyan government has created an enabling environment for businesses to flourish within the digital economy through investment in ICT infrastructure such as the National Optic Fibre Backbone Infrastructure. 

The disruption in the retail sector has seen investors in malls in the country grapple with major cuts on returns in their investment.

Measures to mitigate the spread of coronavirus, such as social distancing have affected malls’ human traffic as more people shift to e-commerce.