Amazon has officially entered the e-commerce market in sub-Saharan Africa with the launch of its marketplace in South Africa. This move marks the tech giant’s first foray into the region’s e-commerce landscape, following its acquisition of Souq in Egypt in 2017.
In a strategic move to tap into the estimated $3 billion annual e-commerce revenue in South Africa, Amazon is set to compete with local players such as Takealot (owned by Naspers), Makro, and bidorbuy from Bob Group. However, Amazon’s debut in the country comes without its renowned Prime membership program, which offers various perks such as media services and free shipping on select items.
Despite inquiries about the potential introduction of Prime in the region, Amazon declined to comment on its plans for South Africa. Instead, the e-commerce giant revealed its initial focus on selling international brands and local products across 20 different categories. To entice customers, Amazon is offering same-day and next-day delivery, along with 3,000 pickup points. Additionally, free delivery is available for first orders and subsequent purchases exceeding R500 (~$27).
The launch of Amazon’s marketplace in South Africa has generated mixed reactions within the local e-commerce ecosystem. While some view it as a positive signal for the strength of the country’s e-commerce market, others question the necessity of another player, particularly one entering from the United States. Francis Dufay, CEO of Jumia, noted the competitive nature of South Africa’s e-commerce space but acknowledged that increased competition validates the opportunity for growth in African e-commerce.
Amazon’s entry into South Africa has been years in the making, with initial plans announced two years ago for launches in both South Africa and Nigeria. However, various delays pushed back the debut, with South Africa originally slated for April 2023 and Nigeria for February 2023. Despite starting to onboard independent sellers in South Africa in October 2023, Amazon has yet to provide an update on its Nigerian launch. It is worth noting that Nigeria is also believed to be one of the most prosperous regions in Africa which means that the company must have plans to launch there as well but there might be strategic and compliance hurdles that are holding the launch back.
