Retail media: Shaping the future of e-commerce

“My experience at LeaderEx for e-commerce was nothing short of amazing. Despite the nerves and mild panic attacks before going on stage, it was a career highlight to share the stage with some of the country’s most respected marketplace professionals.”

Key takeaways from the event

Hybrid commerce is the way forward: One option does not outweigh the other. Choosing where to sell your products can be difficult for entrepreneurs or business owners. That is at least the perception that many have: Should I only focus on direct to consumer (DTC) or should I invest my time into marketplaces?

The answer is simple – test both. We are in a much more mature state from a commerce perspective where business owners can push their products through different channels. Gone are the days when you only needed to use one form of distribution channel or retailer. You can facilitate DTC, marketplaces, and even brick-and-mortar stores to test what works best for your business. With greater diversification in your channel mix, you will have a clearer idea of what’s pushing the needle.

A greater number of channels, unfortunately, means more admin and systems to streamline logistics. However, operating in a hybrid model allows you to understand your customer on a deeper level and can lead to scaling your business.

The importance of marketplaces in South Africa: People don’t just go to the shop and buy what they need, there is a step between the ‘need’ and ‘transaction’. Marketplaces have positioned themselves in a way for the final consumer to do product research on a specific product they want and to compare products across e-retailers or marketplace environments.

The key takeaway here is to ensure your product description page is optimised to appear higher in the search rankings and subsequently increase conversion rates and decrease returns. If someone is in the state of mind to purchase sunscreen, they will. However, if the sunscreen you are advertising does not speak to the user’s needs with features and benefits, they will leave your page and shop for another brand.

Is Amazon’s arrival a game changer? Answering the question of whether Amazon is a game changer in South Africa is not a simple yes or no. To answer this question, it’s important to consider who’s asking and subsequently formulate an opinion.

For many, the arrival of Amazon seemingly failed expectations of international assortment and great deals. That may ring true, but it is unfair to compare a new entrant in the space and expect them to overhaul local competitors – even if this competitor is Amazon. Amazon did not come to ‘win’ in year one, but rather set their focus on year five or ten to gain market share.

There is a reason why Amazon is as big as they are, but it’s evident that arriving in 2024 within a market with a strong e-commerce adoption will be difficult. There is no doubt that Amazon had a positive impact on the growth of marketplaces in South Africa and that the future is looking bright for pure players and e-retailers with the retail media niche growing exponentially.

E-commerce is growing in a positive trajectory, but loyalty will be tested across e-retailers and marketplaces. South Africans aren’t afraid to shift and switch to a channel/marketplace; they can get the same product at a more affordable price and ultimately players in the industry will need a clear USP to keep consumers coming back.

The future is bright for retail media in South Africa with the niche growing exponentially, and no one wants to be left behind. Events such as LeaderEx will become even more important in the future to facilitate conversations and networking opportunities for leaders in digital and e-commerce.