Superplatforms and How They Will Impact Merchants, E-commerce and Financial Services in Africa
Our ongoing research for MSMEs is to better understand the merchant ecosystem, their mental models, behaviors and practices, so we can create incentives for merchants to digitize their business and connect them to tailored financial services, such as microloans for working capital.
In our superplatforms research stream, FIBR aims to determine:
- the value proposition to merchants by Jumia, Facebook and Chinese players
- the merchant personas of early adopters of superplatforms for business use by exploring the following questions below.
Our Hypotheses about Superplatforms
Digitization is a necessary but not exclusive means for MSMEs to sell more.
- Customers are increasingly going online for at least part of the shopping journey and making purchasing decisions while browsing.
Merchants are informally leveraging social networks and messaging tools to advertise to and inform customers and convert them into sales, although most complete the transaction via offline/in-person payment and third-party deliveries.
Merchants are using a combination of ad-hoc/informal and paid advertising on social networks and messaging tools, opting for the ad-hoc methods for their simplicity.
Trustworthiness is a premium for both buyers and sellers in online marketplaces and increasing the perception of trust in the relationship will benefit both merchant and customer.
Professionalization of e-commerce through provision of end-to-end business services by the superplatforms are essential for MSMEs to increase their chances of success
- MSMEs are using social networks and messaging apps as informal business tools to more effectively understand and manage their customer base (through segmentation, automation and analytics).
High-performing merchants are experimenting with and effectively leveraging more formal business services such as paid advertising, financing and fulfillment.
Platforms that offer additional business services such as digital storefront, customer service, financing, conflict resolution, and fulfillment can help small businesses enter the market, survive and grow
More marketplace transparency (product information, pricing, shipping costs, delivery times, buyer/seller profiles & ratings, ease of registration) and standardization (return policies, sizing, product SKU/bar code) will accelerate customers buying and merchants selling online.
Enabling mobile payments on platforms for merchants to pay and customers to purchase will accelerate e-commerce adoption by sellers and buyers.
E-commerce strategies can increase the chances for young adults (18-35 years of age) to generate income or find employment
Single business owners seek to employ young tech savvy digital marketing or customer service specialists.
Young adults are exploring and discovering interests and talents that align with a revenue generating activity or livelihood, via e-commerce or digital marketing activities online.
Young adults are generating income or primary livelihood as digital marketers for their own product or service, or for hire (using social media and messaging tools).
Superplatforms offer young adult MSMEs the business knowledge, professional networks and working capital they need to succeed, to which they would otherwise not have access at the start of their careers, and reduce their risk in entering the marketplace.