E-commerce in Senegal
E-commerce in Senegal is booming. Today, with the emergence of different payment methods including cash on delivery as well as mobile banking, Senegalese are increasingly interested in purchasing different products and services through e-commerce platforms.
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The coronavirus pandemic has increased the number of Senegalese buyers opting for e-commerce as it has prompted the digitalization of different sectors in Senegal. The health crisis has impacted all sectors of economic activity. Despite its negative economic impact, it has made it possible to consolidate the digitization of several companies operating in different sectors.
The banking rate in Senegal does not exceed 21%. However, the number of businesses integrating e-commerce is multiplying, especially in the capital Dakar, due to the increase in the Internet penetration rate which reached 74% in 2019 as well as the offer of different payment methods.
The opportunities of e-commerce in Senegal:
- Cost reduction:
People wishing to enter e-commerce in Senegal benefit from reduced costs as they will not need to have a store or physical vendors. With the emergence of e-commerce platforms, the seller can benefit from several advantages and manage his business without additional costs.
- Growth opportunities for e-merchants:
In Senegal, the online commerce market is still recent and there are quite a few opportunities for businesses or individuals. E-commerce in Senegal can be exploited in several sectors and allow them to conquer new markets and reach more potential customers.
- High internet penetration rate:
In 2021, the internet penetration rate in Senegal is 46% with around 7.81 million internet users.
The challenges of e-commerce in Senegal:
- Lack of skills and knowledge:
E-commerce is about more than just having a well-developed website. However, it is a whole series of skills that will allow you to establish a strategy that will help you influence the perception of the customer and persuade them to make purchases online.
Similarly, illiteracy in Senegal is a major problem that prevents Senegalese from resorting to online shopping (According to the ANSD: the literacy rate in 2015 is 44.8% for people aged between 15 and 59 years old).
- Electronic payment problem:
E-commerce in Senegal suffers from a major obstacle which is the very low banking rate (15% in 2014). However, today with the development of mobile banking and the emergence of cash on delivery, this obstacle is starting to be overcome and people are becoming more and more open to different payment methods. In this sense, it is essential to offer solutions in relation to the security of online transactions in order to gain the trust of customers.
- The lack of a legal framework:
The lack of a legal framework remains a real problem facing e-commerce in Senegal. For this, it is essential to establish a well-groomed legal framework in order to foster confidence among buyers.
- The inability to test products before purchasing them:
In the consumer’s mind, buying products online is often linked to the inability to test the products before buying them. To avoid this obstacle, the seller must organize his e-commerce site well by adding detailed descriptions as well as real images and videos of the product offered.
- The shipping and logistics problems:
The rather long delivery times push the Senegalese who are impatient by nature to avoid making purchases online. Today, this problem is starting to be resolved with the emergence of several shipping companies ensuring the delivery of products throughout Senegal, from all over the world.
E-commerce in Senegal after the Covid19 pandemic:
The Covid19 epidemic has reported a notable increase in e-commerce. After the coronavirus pandemic and the establishment of lockdown measures, several traditional businesses in Senegal are choosing to have an online presence in order to continue operating and overcome the consequences of this crisis. For its part, the Senegalese government is promoting this operation by inserting e-commerce policies and reforms. Also, the country's Ministry of Commerce has made available to buyers an e-commerce platform that brings together the websites of SMEs that sell essential products in order to avoid taking risks when leaving their homes.
The profile of Senegalese converted to online buyers:
According to statistics from 2016:
- People aged 25 to 34 are the most active when it comes to online shopping, followed by the 18-24 age group
- In terms of purchase volume, men present the majority of online transactions (58.5%)
- The majority of online buyers in Senegal are located in the Senegalese capital Dakar (61% of buyers)
- The most purchased products are respectively: fashion items and accessories, jewelry and watches and electronic products and components (smartphones, tablets…)
- Cash on delivery is the preferred payment method for Senegalese buyers (95% of online buyers)
- Facebook is the most requested social network by online shoppers