Growth opportunities in embedded insurance for eCommerce and marketplaces in Nigeria are becoming more massive year-on-year, as Africa is forecast to surpass half a billion eCommerce users by 2025 with a projected 17% CAGR of online consumers for the market, according to The Rise of eCommerce in Africa.
Before delving fully into how embedded insurance is helping African eCommerce platforms offer more value to customers lately, let's take an eagle view of how the eCommerce and online retail sector has been performing across Africa.
How Big Is eCommerce in Africa?
1. Africa has a young population, fast-growing cities and rapidly increasing disposable income. It is home to 54 countries, each at their own stage of economic development.
2. Online retail revenue in Africa is estimated at around USD20 billion annually, which is only 3.5% of total retail sales. This signifies truck load of growth opportunities.
3. Africa leads mobile device web traffic generation, with 69% of its total web traffic consisting of mobile internet users as of 2021 and is forecast to be an almost exclusively mobile-based market by 2040 - eCommerceDB.
4. Compared to other regions, as of 2021 the African continent leads mobile internet usage a full 13% above the global average, and almost 5% more mobile usage than Asian region markets.
These factors among others means Africa has all the components for a rapid expansion both in its overall economy and in eCommerce.
The biggest eCommerce platforms in Africa?
According to Web Retailer, the top 3 largest ecommerce businesses across Africa in 2023 are:
With about 23 million visits per month, the biggest online marketplace in Africa is Jumia. It is the only marketplace with active operations and sales across Nigeria, Egypt, Morocco, Kenya, Tunisia and more African countries till date.
The 2nd largest ecommerce in Africa is Takealot.com. With 10 million monthly visits, 96% of which are from its home country of South Africa. Takealot.com aims to be the largest, simplest, most customer-centric online shopping destination in Africa.
Souq also has around 10 million monthly visits, most of which are from Egypt. It was originally a Middle Eastern business which was acquired by Amazon in 2017. Reportedly, 78% of all online shopping in the Middle East and North Africa happens on Souq.
eCommerce Trends in Africa in 2023
Notable trends signifying growth of eCommerce in Africa in the last one year include:
Social Commerce: Use of social media for e-commerce is becoming more popular in Nigeria and Africa as many are now using platforms like Facebook and Instagram to sell their products. Social media being a powerful tool for reaching new customers and increasing brand awareness is emerging as a key growth driver for social commerce in Africa.
Omnichannel Shopping: Online shoppers in Africa are no longer limited to a single device or channel for researching products, comparing prices, and buying. They switch between smart devices without losing their place in the purchase journey. This trend has led many e-commerce platforms, like Jumia, to ensure that their channels can be accessed regardless of the platform or channel.
Seamless Payment Methods: Recent economic policies by the Nigerian government are encouraging cashless payment for goods and services both online and offline. This has opened a new vista for payments via digital and electronic banking nationwide.
Personalized Shopping Experience: Another important trend in 2023 is the increasing use of artificial intelligence and machine learning in e-commerce. These technologies help eCommerce and Marketplaces personalize their customer interactions, improve the accuracy of their recommendations, and make more informed decisions based on consumers' buying and engagement data available to them.
Embedded Insurance for eCommerce in Africa
As the digital landscape for retail constantly evolves, embedded insurance has proven to be a key tool to help e-commerce businesses across Africa to:
With Curacel's AI-powered embedded insurance infrastructure, African eCommerce platforms, marketplaces and online retailers can offer cheap, attractive insurance cover for undesirable eventualities as an add-on at check-out, or embed it further into their offering by including it in their prices.
Curacel Grow offers your customers seamless insurance protection on any platform where they choose to interact with your business. Our embedded insurance API ensures that your eCommerce and online retail business can integrate insurance coverage such as Goods in Transit, Fire and Burglary, Vehicle Insurance, Motorcycle Insurance, Gadget Insurance, Credit Insurance against liability, theft and damage.
On top of that, our insurance claims process is made easy such that you can submit and track claims all on one easy-to-use dashboard. Get started now
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