Business
Jumia and Konga.com – Africa’s equivalent of Amazon.com
(Bloomberg) – When Gbemiga Omotoso bought a Samsung tablet computer last year, he handed over his cash to a man in a van. There was nothing shady, though, about the transaction. It’s part of online retailer Jumia’s attempt to adapt to the unique challenges of selling in Nigeria.
With many of the country’s 160 million residents not familiar with making payments online, the Lagos-based retailer wins over skeptical shoppers by accepting payment on delivery and offering free returns.
“It’s very important that people know it’s not a scam,” said co-founder Tunde Kehinde, 29. “Even though they want to buy, trust is still a very, very big issue.”
Jumia and local rival Konga.com have taken a page from the playbook of Amazon.com: delivering electronics, clothes, and even refrigerators to the front doors of Nigerians. Shopping locally has usually meant higher prices, less selection, and often sitting in traffic for hours to get to stores.
“There’s a lot of appetite for consumption, but supply is terrible,” said Jeremy Hodara, founder and managing director of Africa Internet Holding, an investor in online businesses across the continent and a shareholder in Jumia. “It’s expensive and cumbersome to buy abroad, but if there’s no choice, that is what people do.”
In the lead-up to Christmas, Jumia aims to boost revenue by 40 percent each month through December. Items featured in the site’s holiday section range from berry wreaths to MAC lipstick to kids’ bikes for NGN11,995 (US$75).
On a recent November day at Jumia’s warehouse – a stadium-size building, in a Lagos commercial district, employees pulled items from the shelves, then stuffed them into delivery vans or piled them onto motorbikes.
Jumia has received US$75 million in funding since its inception, including seed capital from Berlin-based Rocket Internet. The company has 600 employees and also sells in Kenya, Morocco, Ivory Coast, Egypt, and South Africa.
