Online stores in South Africa are experiencing a big increase in sales as consumers avoid physical stores and problems related to panic buying.
On Sunday, President Cyril Ramaphosa announced urgent measures to address the COVID-19 coronavirus outbreak in South Africa.
Concerns around the virus prompted people to self-isolate and limit their social interaction. It has also resulted in South Africans stocking up on food and other items.
Online shopping is a perfect solution during a time when physical interaction should be limited, and unsurprisingly ecommerce volumes are spiking.
ParcelNinja CEO Justin Drennan told MyBroadband that they have seen an increase of between 20% and 30% in online sales this week.
PriceCheck CEO Kevin Tucker told MyBroadband that clicks to their merchants are up over 50% since the coronavirus restrictions hit South Africa.
There is a particular interest in hand sanitiser product, which now make up over 50% of search volume on PriceCheck (see image below).
Tucker said the increased volumes show that people are intent on purchasing online as brick-and-mortar shops have failed them.
Allsale CEO Michelle Lehrer said there is a trend of consumers wanting items that are of immediate importance and urgency.
Lehrer said they have seen a shift in sales – 85% of sales are now cleaning and sanitation products including Dettol, Domestos, and hand sanitiser. This accounted for less than 5% last week.
Surge in online deliveries
Pargo CEO Lars Veul told Mybroadband that they have experienced a surge in online orders for delivery after President Ramaphosa’s announcement.
“The biggest spikes came from companies selling health and hygiene products, followed by electronics,” said Veul.
He added that “click and collect” is proving to be a popular option for consumers who adhere to recommendations to keep ‘social distance’.
To ensure that all parcel deliveries and collections are safe, Pargo has introduced contactless collection.
“Together with our pick-up point partners we have put measures in place to minimise the risk of cross-infection as suggested by the Department of Health,” said Veul.
“These include regular cleaning of counters with disinfectant spray and the frequent use of hand sanitiser.”
Watershed moment for online shopping in South Africa
Drennan said they have seen a spike in the number of companies which are currently not online that want to launch an ecommerce offering.
He said companies which were previously on the fence about opening an online store have realised they are missing a big opportunity.
“The slowdown in foot traffic in shopping malls and the increase in online shopping showed that all companies must have an ecommerce play,” Drennan said.
Drennan added that an online shop, through a logistic partner like Parcelninja, also serves as a backup or disaster recovery solution when a company’s existing logistics or shop is forced to close.
Veul saw the same happen at Pargo. “Besides the growth in volumes from existing ecommerce partners, we have noticed an increased interest from companies that are looking for new and innovative ways to crisis-proof their business,” he said.
Drennan and Veul said this is a watershed moment in the South African ecommerce market which will prompt many traditional brick-and-mortar businesses to launch online shops.