Amazon South Africa launches in play for $3bn e-commerce market
TLDR
- Amazon launches e-commerce marketplace in South Africa, marking its entry into sub-Saharan Africa.
- South Africa becomes Amazon's first marketplace in the sub-Saharan region, competing with local players like Takealot, Makro, and bidorbuy.
- The launch does not include Amazon's Prime membership program, facing competition in a market estimated to generate $3 billion in revenue annually.
Amazon has launched its long-awaited e-commerce marketplace in South Africa, marking its entry into sub-Saharan Africa. This move comes two years after the tech giant announced its plans.
South Africa becomes Amazon's first marketplace in the sub-Saharan region, complementing its existing operation in Egypt following the acquisition of Souq in 2017. Notably, the launch does not include its famous Prime membership program.
In South Africa, Amazon will face competition from local players such as Takealot (majority-owned by media giant Naspers), Makro, and Bob Group’s bidorbuy. These competitors have already established a presence in the country, tapping into an e-commerce market estimated to generate $3 billion in revenue annually.
Key Takeaways
South Africa, often regarded as Africa's most advanced economy, has historically been viewed as an attractive entry point for companies seeking to expand into the continent and Amazon's service in the country comes at a time when it has experienced a significant increase in online shopping, particularly following the pandemic. More so, the retail sector in South Africa is growing and evolving, attracting international fast-fashion e-commerce retailers such as Shein and Temu. These companies have experienced rapid growth driven by strong demand for their affordably priced apparel. Temu, in particular, launched in South Africa earlier this year, capitalizing on the country's expanding e-commerce market. Retailers in South Africa are also intensifying their investments in e-commerce infrastructure as internet connectivity and smartphone penetration rates continue to rise in the country.
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