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South African shoppers are doing more of their shopping online, and there’s no sign of the trend stopping.
That’s the finding of a new report published by Mastercard published on 14 April.
The report found that online sales were a lifeline for retailers and restaurants during the COVID-19 pandemic.
“While consumers were stuck at home, their dollars traveled far and wide thanks to e-commerce,” said MasterCard Chief Economist, Bricklin Dwyer.
“This has significant implications, with the countries and companies that have prioritized digital continuing to reap the benefits.”
Mastercard: Local and global trends in online shopping
The Mastercard Recovery Insights report for 2020 identified several trends related to online shopping.
Between March 2020 and February 2021, international e-commerce grew between 25% and 30%. This brought in an additional $900 billion.
To put it into perspective, that means around $1 for every $5 spent on retail was spent online. In 2019, it was $1 for every $7.
In the Middle East and Africa, under which South Africa falls, e-commerce made up 4.6% of retail sales at the height of the COVID-19 crisis, up from 2.2% before the crisis. Now, e-commerce makes up 2.4%.
The retail sector to experience the biggest growth in e-commerce was essential products such as food and groceries. Mastercard estimates that between 70% and 80% of the growth in the sector will be permanent.
Meanwhile, 68% of South African customers are doing more of their shopping online and 54% are buying their groceries online. South Africans also made an effort to support local businesses with 63% wanting to buy from local stores online.
In addition to increasing online spending, COVID-19 also sped up the shift to contactless payments. A Mastercard study last year showed 75% of South Africans used contactless payments while 71% preferred to shop at stores that offered contactless payment options.
The report concluded that between 20% and 30% of the overall shift towards online shopping during the pandemic was permanent.
Feature image: Unsplash/rupixen.com