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Jumia’s Expansion Plans Set to Dominate the E-Commerce Market in 2024

Jumia

Nigeria’s e-commerce scene is ever-growing, projected to reach $22 billion by 2024. But this digital revolution isn’t confined to bustling metropolises; it’s quietly transforming the lives of millions of consumers in secondary cities and rural areas. At the forefront of this rural e-commerce push is Jumia, Africa’s leading online marketplace. By strategically expanding beyond the bright lights of Lagos and Abuja, Jumia is connecting previously underserved communities with the vast array of goods and services available online, bridging the retail gap and empowering rural Nigerians like never before.

Prior to the creation of companies like Jumia that made it possible for consumers to shop without geographical restrictions, purchases of several commodities required lengthy trips, increased costs and risks that accompanied traversing unsafe roads. E-commerce has grown over the past decade with the increased penetration of smartphones and the internet. As of 2020, GSMA reported a mobile subscriber count of 173 million in Nigeria, indicating an 85% penetration rate. The prevalent use of smartphones enables consumers to conveniently access e-commerce platforms and make purchases from anywhere in the world.

Recognizing the growing number of rural Nigerians with internet access, the company embarked on a strategic expansion into secondary cities and rural areas. This involved establishing logistical networks, partnering with local agents and businesses, and tailoring product offerings to cater to the specific needs of rural communities. Jumia launched the JForce programme — a grassroots initiative launched by Jumia to take e-commerce to secondary cities within Nigeria  — to meet this need. Under the aegis of the JForce programme, Jumia has established efficient delivery infrastructure, including partnerships with local logistics service providers and leveraging community pick-up stations, reaching even the most remote villages.

Modifying existing strategies, Jumia combined online and offline operations to cater to both those who have access to the internet and those who don’t. Through this tactic, the company has taken e-commerce to hundreds of Nigerians in rural communities, where digital literacy is limited.

Leveraging the age-long art of marketing by mouth, Jumia, through its JForce initiative has bridged the digital divide in rural communities and increased accessibility to e-commerce. JForce adopts a very communal model – local sales representatives who are tech-savvy give community members who lack access to smartphones or are digitally illiterate access to product catalogues on the Jumia Marketplace platform and place orders on their behalf. Strengthening the pillars of JForce, Jumia simultaneously established more than 250 pickup stations and collaborated with reliable logistic partners to fast-track product deliveries to secondary cities and rural areas. The deliberate positioning of these pick-up stations in diverse towns guarantees accessibility to even the most remote corners of Nigeria, thereby enabling customers in rural areas to overcome geographical limitations and access various products. This initiative has been a vital way to enable many rural communities to leapfrog economic and geographical barriers, stimulating growth and development with target communities and the e-commerce sector.

But the communities are not the only beneficiaries. Through JForce, Jumia works with local entrepreneurs, training them as agents to facilitate online purchases and deliveries, creating jobs and fostering economic growth within the communities. To date, Jumia has over 35,000 active JForce agents who earn a living through commissions earned from introducing consumers to shop online.

Transforming Lives, One Click at a Time

Jumia’s impact in rural Nigeria is undeniable. Families can order essential items directly to their doorstep, saving them time and money. Jumia’s “E-Commerce in Rural Areas in Nigeria” report highlights these positive changes. It reveals a significant rise in online purchases from rural areas, with a growing demand for smartphones, home appliances, and fashion items. The report also showcases the positive impact on rural entrepreneurs, with many Jumia agents reporting increased income and business opportunities.

Challenges and the Road Ahead:

Despite the success, challenges remain. Limited internet connectivity and digital literacy in some rural areas can hinder adoption. Additionally, reliable electricity supply and efficient payment systems are crucial for sustained growth.

Jumia is actively addressing these challenges. Last year, the company partnered with Starlink, a satellite internet service, to retail the Starlink Residential Kit in Nigeria to bridge the digital divide by delivering Starlink’s high-speed, low-latency internet to previously underserved regions.

In the third quarter of 2023, Jumia experienced significant growth in Gross Merchandise Volume (GMV) for physical goods across five countries, a surge that can be partially credited to its intensified expansion into rural areas and secondary cities. With the recent appointment of a new CEO in Nigeria, the company’s focus is on driving expansion initiatives across the country, aiming to replicate the successes observed in those five countries. Doubling down on this expansion strategy, Jumia aims to broaden its reach, linking more consumers to the e-commerce sphere, extending beyond the confines of major cities and into previously untapped regions within the country.

With pillars for growth and expansion solidly set in place in 2023, it is left to be imagined what the e-commerce leader will achieve this year.

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