This archive report was first published on 22 July 2019.
July 22, 2019 - Kenyan retailers are embracing e-commerce to tap into the growing demand for online shopping and boost sales volumes. Local retailers such as Chandarana Foodplus, Tuskys, Carrefour, Naivas, and Zucchini have forged partnerships with e-commerce firms to reach young, tech-savvy shoppers.
According to Nielsen's Retail Measurement Defined FMCG Basket findings, e-commerce is projected to grow five times faster than offline transactions over the next five years. French-based retailer Carrefour, Tuskys, and Naivas have signed deals with e-commerce giant Jumia, while Chandarana FoodPlus has an ongoing agreement with digital retail platform Grocerypik.
Naivas, Onn the Way Supermarket, and Zucchini have also sealed a deal with Spanish delivery firm Glovo to expand their customer base in areas where they lack physical stores. The partnerships are largely driven by the growing Internet penetration and take-up in Kenya.
Tuskys chief executive Dan Githua noted that the company is shifting focus to online and direct delivery platforms, saying, "The channels we reach our customers will change rapidly, of course, with lots of focus on our online and direct delivery platforms."
However, quality concerns, additional costs, and delivery time remain the biggest barriers to online shopping, with only three out of 10 local shoppers willing to shop online in the next six months. Nielsen East Africa Consumer Insights Lead Pauline Achayo observed that trust levels are low in the local e-commerce landscape but all indicators show that e-commerce is set for exponential growth in the near future.
