Nigeria is seen by many investors as a gateway to the African market: the country has the highest GDP in Africa. Investment has enabled the country to develop its digital market; improving internet services and accessibility has created opportunities for digital businesses. E-commerce has become one of the most lucrative online markets in Nigeria; the rate of internet usage and purchases has continuously increased over the years. The rising amount of online retail purchases has resulted in the e-commerce market in Nigeria reaching a value of $13bn within just ten years. Nigeria’s young population and rising mobile usage rate will contribute to the success of the market in the future. Consumer spending will increase as a young generation, who are becoming increasingly used to making online purchases, age and the next generation of consumers enters the market.
Despite the digitalization of Nigeria, various issues still prevent the e-commerce market from thriving in the current market environment. Only a small proportion of Nigeria’s population has access to the internet, which means the market is still relatively small. Consumers have a lack of trust in e-commerce services due to the prevalence of digital fraud. Revenue loss from e-commerce businesses as well as unreliable delivery services and poor customer services compound the problems. A lack of transport infrastructure has also hindered e-commerce ability to deliver nationwide.
Despite issues, the Nigerian e-commerce market still has great potential and is experiencing strong market growth. Ambitious national forecasts demonstrate the belief that the e-commerce market could lead growth in Nigeria. The government and investors will continue to plough resources into the digital transformation and innovative technologies to improve its digital landscape and help digital businesses. Road access interventions will help provide more efficient transportation links around the country, improving e-commerce services and reinstating consumer trust. Companies and government organizations have begun taking action to combat digital fraud. The success of efforts made by anti-fraud organizations will create a more honest and trusted market place in the future. This will encourage consumers to use e-commerce websites which will aid market growth.