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Online shopping growing in South Africa – World Wide Worx, Mastercard

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Online shopping is on the rise in South Africa according to a newly released study by World Wide Worx and Mastercard, despite the country's slow recovery from lockdown restrictions and social distancing.

The Online Retail in South Africa 2023 study shows that online shopping shot up from 27% of adult South Africans in 2020 to 38% in 2022, a 40% increase in the total number of people shopping online.

"The most revealing aspects of the new data lie in demographic differences between South Africans," says World Wide Worx CEO Arthur Goldstuck, principal analyst on the research project.

"The gender breakdown in particular shows that the traditional gender divide in online shopping, which was dominated by males in the early years still persists, with 41% of men and 36% of women shopping online."

According to the report, a contributing factor to men dominating the online shopping space is due to them purchasing electronic goods more frequently, which traditionally is a male shopping domain.

However, the fact that the biggest growth areas in online shopping in recent years have been in groceries and apparel categories, traditionally dominated by women shoppers, suggests there are other factors at work.

"These may well include elements like male control of household budgets and men being more likely to have a credit card in a household. It shows that outmoded societal norms die hard," Goldstuck added.

The report found that men are more active in e-commerce in SA, with 41% of men and 36% of women shopping online.  (Source: Image by Freepik)
The report found that men are more active in e-commerce in SA, with 41% of men and 36% of women shopping online.
(Source: Image by Freepik)

The study included analysis of the annual Target Group Index (TGI) survey conducted by Ask Afrika, which interviews 16,000 South Africans every six months to gather data on their consumption (products, brands and the media), purchasing behavior, attitudes, motivations and beliefs. This survey provides the most detailed demographic breakdown of online shopping available in the country.

Young people dominate online shopping

Goldstuck found that the age breakdown of online shoppers in South Africa has seen a significant shift from 2020 figures.

In 2022, online shopping peaked in the 25-34 age bracket, and then steadily dropped off with each successive age group. The second major shift observed during the past year, was in the significant drop in penetration of online shopping among the 65+ age group. This is the only age group that sees lower penetration than during the height of the pandemic, falling 19%.

In comparison, during the pandemic, online shopping had "normalized" across age groups, and at the time, an average of 27% to 30% penetration was seen in all age groups up to the age of 64.

"One conclusion that we can draw from the research is that online shopping is strongly correlated with age, but with the youngest age group constrained by lack of earning ability," said Gabriel Swanepoel, country manager of Mastercard Southern Africa.

"A second conclusion is that the oldest age group has a strong reticence towards online shopping, which is backed up by another finding that this bracket is the most likely to still prefer in-store shopping experiences."

While most age groups show a relatively high level of agreement with the statement that in-store shopping is preferable to online (24% to 30%), this figure increases dramatically to 41% in the over-64 category. No other demographic measure shows such a strong divergence in one segment regarding preference towards in-store experiences, World Wide Worx found.

The metrics also showed a high positive correlation with online shopping when it came to education, rising from 20% for those with less than a matric qualification (grade 12) to 54% of those with tertiary education. A similar pattern was to be seen with income, the numbers rising steadily from 22% of those earning less than R2,500 (US$135) a month to 62% of those earning more than R50 000 (US$2,711).

"The results are in effect a blueprint for online retailers, showing on the one hand where they will reach their most lucrative customers, and on the other the segments they must target to grow online retail further in South Africa," Goldstuck concluded.

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*Top image source: Image by wayhomestudio on Freepik.

— Paula Gilbert, Editor, Connecting Africa

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