The Information and Communication
Technology (ICT) industry watchers at ITRealms,
have been keen on the examination of key impacts of the recent merger between
Konga and Yudala, summed up in five pointers.
Despite significant optimism of
an unprecedented upsurge in global e-commerce spend which is widely expected to
gross $4.058 trillion or 14.6 per cent of total retail spending by 2020,
e-commerce in Nigeria and on the African continent is still largely untapped.
Till date, majority of players in
the sector are locked in a battle of attrition in their bid to turn profitable.
Many others have lost the battle and quietly exited the scene. The list of such
failed ventures is seemingly endless.
Recently, an operational merger between
two e-commerce giants, Konga and Yudala was announced – a piece of news that
has dominated headlines for the past one week.
According to the official
announcement released by the management of both companies, the business merger,
which takes effect from Tuesday May 1st 2018, will see both
companies operate under the Konga brand name and with dual CEOs in the persons
of Nick Imudia who will be in charge of online among others and Prince Nnamdi
Ekeh who will be responsible for the offline arm of the business.
Founded in 2012, Konga has featured
prominently in the news in the past couple of months following its acquisition
by Nigerian tech giants, Zinox Group, after months of intense negotiation with the
company’s erstwhile majority investors, Naspers and AB Kinnevik.
A merger between Konga and Yudala
is a master strategy that undoubtedly has the potential of finally cracking the
e-commerce bug in Nigeria and beyond.
Here are five reasons why:
Strongest
e-commerce force in Africa: The merger between Konga and
Yudala has ultimately transformed the new Konga brand into a strong e-commerce
group, arguably the biggest on the African continent. By virtue of the shared
resources that will naturally benefit the brand from the merger including sheer
size, human resources capacity, massive warehousing capabilities, increased
reach and wider array of products, services and offerings at its disposal,
industry watchers and other experts are unanimous in their position that Konga
can finally rise as an e-commerce force that can rival some of the world’s
biggest such as Amazon and Alibaba.
Improved
customer experience: One of the major obstacles that has prevented
e-commerce from taking off in Nigeria is shoddy customer experience. With Konga
and Yudala merging operations, there is renewed hope for the average customer,
especially when one considers a fusion of Konga’s world-class online platform and
Yudala’s ubiquitous network of physical stores. Both platforms are efficient,
highly responsive and respectively best in class in the industry. With this
merger, perhaps, the time has come to look forward to a highly improved
shopping experience, one that has largely eluded many in the industry.
Cutting-edge
Technology: Konga is primarily a technology company, one that
has invested heavily in technology and crucially reliant on cutting-edge tech
to drive its operations. By merging
forces with Yudala, another technology-driven business and leveraging on the
huge access to technology at the disposal of its parent company, the Zinox
Group, there is a golden opportunity to improve the ease and convenience of the
shopping experience, a factor that has recurrently featured as one of the
pain-points of e-commerce. Through the
deployment of technology in automating most of the processes that have
previously encumbered shoppers, including products classification, stocking,
check-outs, logistics and delivery, among others, a fresh dawn seems imminent
for e-commerce in Nigeria. Should the new brand live up to expectations by
deploying a predominantly automated, user-friendly range of cutting-edge tech
solutions, it will succeed in creating a frictionless e-commerce experience
that will set a standard for the continent.
Better
logistics/delivery: Many e-commerce companies across Africa leave a
lot to be desired when it comes to service level expectations in
logistics/delivery. Items take days or even weeks to get to the final user,
even in urban city centres, leading to a situation in which many potential
shoppers would rather prefer to visit a physical/brick-and-mortar store to
purchase or personally pick-up their items.
In Konga Express, Konga boasts
an excellent logistics company with advanced delivery capabilities for internal
and external customers. Through the expected new investment that will come in
through the Yudala merger, shoppers can finally look forward to a more reliable
delivery option. Further lending a sense of excitement is the multiple pick-up
locations which Yudala’s nationwide network of store locations offers.
Overcoming
distrust by cracking mobile payments: Trust remains a major issue that
has kept e-commerce in Africa from reaching its much-vaunted potential. A
number of potential shoppers are wary of scams, a legitimate concern which
prevents many from disclosing their credit/debit card/financial information and
buying online. Although Konga announced a ban on payment on delivery (POD)
before its acquisition by the Zinox Group, there are possibilities that this
policy could be rescinded in the light of the merger with Yudala. Furthermore,
through Konga Pay, a CBN-licensed
mobile money platform, Konga has a fitting tool with which to crack the mobile
payment bug. By positioning Konga Pay
prominently as a secure platform and doing the hard work at the back-end to
assure online transactions are effortlessly and safely carried out, e-commerce
may just be on the verge of exploding in Nigeria and beyond.
