Nigeria’s e-commerce industry is about 3% of total retail market, says Konga CEO

Shola Adekoya, an accountant by training is the CEO of Konga.com who is passionate about technology. Shola is a big advocate for Africans building African solutions. He believes that Africa should not be left behind especially with technology and Africa should own its technology to own the future of its children. In this interview, Shola whose 6-year old firm recently introduced Groceries offering to meet customers’ needs talks about the challenges and prospects of e-commerce  believing that the groceries category by Konga Daily would deepen the e-commerce industry.

Could you assess online shopping business in the last 5 years?

There has been a huge investment in e-commerce. The investment is in millions of dollars. We have seen successes in the electronic sector. Again there are challenges of pay on delivery which is a reflection of the society rather than e-commerce problem. There is also the culture of look, touch  and feel but the question  is how can e-commerce bring trust. We have done a lot of work trying to bring trust but there is a lot more to be done.  E-commerce is still in the early stages which is still about 3 percent of retail in Nigeria. There is a lot of retail happening off line. The journey from where we are and where we are getting to, about 20 % percent of retail where the likes of  Amazons are, we are still far from it. It is initiatives like Konga Daily that would accelerate the movement. Abroad, people can buy groceries online, so why can’t we do it in Nigeria.

There is now risk in delivery of goods as unscrupulous people attack your men, what is the industry doing to checkmate this?

Already players in e-commerce are coming together to form association. This has been in the works not necessarily  due to the recent attacks. This would enable us to have one voice to enable us speak to a lot of challenges that are common. We acknowledge those risks and what we are doing is to understand our customers better.  We would understand who is ordering what and to where and get some intelligence around security. The delivery risk is not only e-commerce risk but society risk as well. The more we continue to do cash, the risks would continue to exist.

Why is Konga venturing into groceries category?

We are venturing into groceries simply because we want to add value to customers’ lives.  When you look at the statistics in terms of where people spend most of their money, it is food which comes under groceries and provisions. About 73% of Nigerians’ income goes towards   food categories. So what we are saying as Konga is to extend the value that we bring to people on phones, laptops and other stuffs to food categories. This is why we kicked off with Konga Daily to be able to add value to people’s lives. When we say values, it is not just in terms of the discounts or the benefits that consumers get in pricing but also the peace of mind that we bring to their lives and consumers actually now gain more time which if valued on its own is huge. For the fact that consumers don’t have to run around in different markets takes away the stress off  their mind and they can focus on more productive things.

So who are your target audience, women or across board

It is actually across board; this is an across board offering and it doesn’t discriminate. Whatever a buyer can afford is what we are going to offer. The consumer can buy whatever he/she  can afford. There is no minimum basket, it is down to the consumer, whatever it is that the consumer wants and he/sheu can make it their way.

You must be aware that groceries merchandising is a complicated market and riskier, so what gives you confidence to venture in to it?

Yes! You are right, groceries is a difficult category but then when you are going into something difficult, your level of preparation has to be topnotch. I think the first thing that we have done is to prepare warehousing, the handling, we have done a lot of work in those areas. We also understand a lot of processes that we need to put in place. But more importantly, what we are bringing to the table is experience from our trade partners who contributed to the whole process. They have contributed not only to the kind of products but they have contributed to the  policies. We are actually bringing an offering based on not just our own experience, yes we have technology but we are also using experiences of our partners to a large extent.  For the look and feel, once any customer places his/her first order they would not be disappointed. We are giving the best of the best and the fresh of the freshiest of product, so that consumer would never get disappointed.

Who are your partners and how do you guarantee their trust in this business?

For every product that we want, we don’t just buy in the open market.We go all the way to the approved distributors. We pick a product that we want to put on the site  and we know what the brand is  and who is representing them in Nigeria. We have had conversation with them and they have given us their approved distributors, so we know where the products are coming from. We know they are not just coming from the street. For the fish and tomato, we are using a partner that has been doing this for 12 years. These products are well handled from the farm to the temperature to which we keep them.

Is there a minimum amount a customer can buy in the grocery website?

A customer can order from any amount. With N500 you can buy whatever you want and pay your shipping fee. You can decide to buy one tomato and we ship it to you.  You can decide to buy N1 million worth of tomatos, it is fine, so there is no a minimum or maximum.

What if the product is not delivered as at when due over challenges of  logistics and it spoils in the process, what happens?

One of the reasons we delayed initially going in to groceries category is this kind of logistic challenge. Logistics is a big deal. But what we are promising the customers is that the groceries are coming to customers straight from our warehouse and not from one hand to another. So, the time between when it is shipped and when it is delivered is also confirmed. We don’t just ship in nylon bags but in coolers with the ice from the warehouse. By the time the customer gets them it is actually in the right condition.

Why is Konga introducing this service especially at a time and what impact will this have on the e-commerce eco system.

Why would you think that we are not ripe for it? If it happens elsewhere in the world we would embrace it. Nigeria is not an island,  we are part of a global village.  As a matter of fact some people already ship these things in small scale. All we are saying is that we are bringing the Konga might unto the table to push this even harder. When you think about the stress that people go through to just be able to buy groceries in  Nigeria,  there is no reason  we haven’t gotten to that point where we can make the lives of customers easy. So when you ask me why are we going into this categories, it is to  make the lives of customers easy and add value by being able to pull all customers  orders together and give them fantastic prices that would be hard to  find even out there in addition to convenience.

So what you are saying is that this would further deepen the agriculture initiative of the government

Yes. Just think about it, if I can get farmers on tomatos and other groceries in the supply chain it would boost agriculture. A farmer can tell me when his tomato can be ready, then we would buy off.  This would boost his business.

What other prospects do you see in this groceries online business?

This enables us to go indirectly in to agriculture value chain. It  enables us to understand the consumer needs. There is a lot of value that can be created in this category as we evolve.

What impact do you see this category having on the e-commerce business?

This is one category I love as one firm cannot ship all the meat or tomato the whole Lagos consumers need. The success of Konga would open many peeople’s eyes to this category. I expect other e-commerce to enter in to this category of business. But more importantly, Konga venturing in to this would impact positively on e-commerce. This would enable people to think how they would get into the customers lives.