The rise of online

The digital age has meant many things to the world, from being connected to loved ones all over the globe, to opening the internet flood gates of international e-commerce.

September 10, 2012

By Daniel Guasco

The digital age has meant many things to the world, from being connected to loved ones all over the globe, to opening the internet flood gates of international e-commerce. South Africa has seen the growth of the internet, the development of social media and the power of group buying. As social media grows in popularity, one thing we can all agree on is, it is a space to keep an eye on.

The South African market has seen trends where traditional brick and mortar stores have taken their businesses online and achieved great success. Even businesses without an online presence have seen the value of the digital revolution, benefitting from social media being the new “word of mouth” with likes, recommendations and Pintrests.

According to a recent online study conducted by HULT Business School, 90% of consumers trust a peer recommendation; only 14% trust an advert.

Social media has also played a vital role in providing businesses with new ways of connecting with their consumers, and provided a new platform for consumers to share their thoughts and be heard.

“This platform provides all those using it with more than just a way to punt brands, but rather a resource for constructive two way communication, a conversation that we have learned from, where the open communication provides a constant stream of ideas and valuable feedback,” says Groupon CEO, Daniel Guasco.

“The South African market has seen tremendous growth in relation to the acceptance of e-commerce as a trusted means for doing business, with more and more South Africans having access to the internet via mobile phones,” says Guasco. The World Wide Worx study on the internet usage in South Africa has shown that mobile phone connectivity is greater than that of traditional mediums; this translates into a vast consumer base, with access to a world of variety in the palm of their hands.

This rise of e-commerce in South Africa has seen with it the rise of new industries and growth in existing industries. “With this raise in e-commerce comes an increase in employment, something so desperately needed in South Africa and as a South African, something I am truly excited about,” says Guasco.

With local competition growing and new sites coming online rapidly, the group buying or daily deals market has opened up and is blossoming into a thriving industry. With the introduction of debit cards as an accepted means of payment online, the market is no longer limited to those select few credit card holders and has enabled the man on the street to become involved in e-commerce.

While South Africa is still not yet on par with our European and US neighbours, with band width and infrastructure challenges being the root cause of our lag, South Africa are still making leaps forward in the online space. Looking forward we see public and private partnership coupled with the ingenuity of the South African people, as a formula for exciting new developments for e-commerce in South Africa. E-commerce applications for mobile handsets will play a more active role in shaping the way transactions are done via mobile internet access.

For example, the Groupon mobile application which is available for iPhone, Blackberry and other smartphones, allows users to see what deals are currently being run around them and access these deals in real time with one simple click to buy mechanism. It is concepts like these that are going to feature more heavily and play a more decisive role in the online space, forcing more innovation and driving ingenuity.

“The future for e-commerce in South Africa is a bright one, one that we should all be excited about, I know I for one am eager to see what the South African online players can produce once the boundaries of infrastructure constraints have been lifted,” says Guasco.