Covid-19 accelerates growth in e-commerce

Makabelo Malumane, Head of Transaction Banking at Standard Chartered Bank.

The increase in internet penetration continues to redefine the way we live, work and conduct our businesses. According to Statista, a German company that specializes in industry surveys, as of September 2020; Kenya had 46.8 million internet users which places internet penetration at 87.2 per cent. This level of internet usage quickly became a critical economic enabler during the pandemic as institutions jumpstarted the adoption of new ways of working in order to minimize the spread of the virus, whilst sustaining operational effectiveness. The ability for organizations to embrace new ways of working coupled with the increased internet penetration resulted in growth in both the e-commerce and start-up segments, with Nairobi standing as East Africa’s most vibrant technology hub, according to the Global Digital Report. 

The growth in e-commerce has provided consumers with an alternative channel to purchase goods and services from merchants with an online presence. In 2020, this change in trading activities and consumer behavior was further accelerated by the Covid-19 pandemic which placed a lot of strain on the traditional brick and mortar retailers and service providers especially in the second quarter of 2020.  Many businesses, especially in emerging markets, have had to swiftly transition their business models to an online presence in order to stay relevant and accessible to their customer base through the use of mobile applications and mobile-friendly websites.