E-commerce in Nigeria

E-commerce

Internet access

As of December 2017, Nigeria had a population of 195.88 million people, of of which 98.39 million were Internet users, placing the penetration rate at 50.2 %, according to Internet Live Stats. Mobile phone penetration reached 84% in 2017, with 21 million smartphones in the country (The Guardian). Smartphone adoption can be attributed to cheaper phones on the market, an improving mobile network ecosystem, and access to light mobile applications such as Opera mini that consume less data, according to Business Insider. With the intention of expanding internet penetration rates in the country, Google launched 'Google Station' in 2018, a service that provides free public Wi-Fi in several locations across Nigeria.  As of July 2018, the most popular browser was Opera, which controlled 40.16% of browser market share, followed by Chrome (37.19%), UC Browser (9.33%), Firefox (4.79%), Safari (3.02%), and Android (1.57%). During that same period, Google was the most popular search engine, with a market share of 96.41%, followed by Bing (1.99%) and Yahoo (1.13%).

E-commerce market

The Nigerian e-commerce sector was estimated to be worth US$13 billion in 2018. However, economic stagnation in the country has been slowing down internet retail, according to Euromonitor International. Still, the sector has been growing in popularity among Nigerians, making the country a leading hub for e-commerce in Africa. The online retailing channel relies heavily on consumption from consumers with higher income, and many people still prefer to have a face-to-face transaction rather than shop online. Electronics and fashion products are the most popular product categories bought online, and are particularly in high demand among young adults. The growing young adult urban population is more inclined to shop online and they are increasingly using their smartphones to make their purchases, which has helped drive a rise in the internet retailing in the last few years. The most popular e-stores include Jumia, Konga, and Amazon, with the former two leading online mobile retailing in 2017, according to Euromonitor International. Traditional store retailers such as Next Cash and Mr. Price have opened e-stores to boost sales. Cash on delivery used to be the most popular payment method among Nigerian online shoppers, however many stores don't offer that option anymore, which has been seen as a way of truly enabling digital commerce and restructuring the industry. Other popular options are MallforAfrica’s webcard and Paypal - with Nigeria being one of their biggest markets. Nevertheless, PayPal is mostly used when purchasing internationally, and not from local websites. The government has been giving more attention to the e-commerce market in recent years, introducing the Cybercrime Law in 2015, which aims to prohibit and prevent fraud in online transactions.