E-commerce entrepreneurs tap growing South Africa demand

March 1, 2015

Key people behind online retailers in South Africa are building a digital marketing network in Africa’s most developed economy. Adding to it’s appeal is that E-commerce represents more than 3% of the business in the country compared to 14% of the business in Europe.Online retailers confesses in a report conducted late 2014 that while there is a growing consumer group on digital, marketing spending on online media is not “quite there yet”. In 2014, less than 10% of media budgets in the country was on digital media. Showing a research chart, one of the online retailers revealed to me annual online media spending in South Africa is forecast to more than double to US$500 million by end of 2018. One of the company(I cannot disclose to protect my sources) started out in media buying for search and display ads in Cape Town and has expanded to Pretoria, Durban and Johannesburg. Today, while media buying and planning remains its most advanced capability and biggest contributor, the Cape Town based firm has turned into a full service digital agency with a large and growing content team.

Not bad for an agency that started off slightly by accident according to one of the original founders who shared with her company’s approach to media buying. When an American multi national approached her company, it became its first external client in early 2014 and continues to be a client, having just just signed a new three-year extension contract with the agency.The company focus this year is to strengthen the agency’s operations in South Africa market and are looking at growing further by setting up Kenya and Nigeria offices before the end of this year.When I asked whether it wants to venture elsewhere, she says: “From our office in Cape Town, we may help some brands in Europe, Asia, Middle East and North America enter Sub-Saharan Africa.For us, South Africa is the most exciting market.” She also notes that area they are operating has a huge talent gap in Africa since things move very fast. “That will be our biggest challenge going forward not just talent but talent with the right attitude and culture.” Over the next 10 months, the company plans to invest in an academy system. Its modeled in a way that interns can come in and balance between learning and on-the-job activities adding that the programme will start in-house.

On the attitude that her company seeks to have employees comfortably challenging her as well as challenging themselves. This is because she believe in robust problem solving.Her advise to those aspiring to start similar business ventures in South Africa and elsewhere, background in business and marketing are the key ingredients.The thing that’s really important to succeed is to keep that mentality of growing businesses.In helping the clients, her company try to think of the closest things to sales for clients doing e-commerce. She gave an example where identifying a good visitor to their e-commerce sites clients,where site visitors shows a closer intent to purchase rather than just awareness by viewing products and clicks on the store locator.That helps her company to develop a campaign to optimize and grow that aspect. On the growth target for this year, she says: “We have internal targets, but it’s more interesting to see what are the opportunities in the market. I think we probably wouldn’t have aimed as high if I sat here with you early two years ago and decided where we would be now. I think we’ve done really well in 2014 Contador Harrison.”

Contador Harrison