Preliminary study: Social Commerce growth in Ghana

Photo: Social Media Today

The growth of social media in Ghana has grown in the last couple of years. However, it is not clear how the phenomenon has influenced buying and selling online. What online vendors use their social media accounts for is not clear. The features required of an e-commerce website that would attract and retain the Ghanaian online shopper are also not well documented.

I therefore conducted an empirical study to investigate the influence of social media on the growth of e-commerce in Ghana. 

Some questions I considered were:

1. To what extent are online shoppers aware of e-commerce vendors in Ghana?
2. What features of an e-commerce website attract and retain an online shopper?
3. How long have Ghanaians been shopping online?
4. How long have Ghanaian e-commerce vendors been selling online?
5. What types of e-payment solution s are being used by vendors in Ghana?
6. What e-payment challenges are faced by both vendors and shoppers?
7. Has social media had an impact on the sales revenue of online vendors?

Deductions from the results show that a great number of Ghanaians are active on social networks, with accounts on Facebook, Twitter, Linkedin, Instagram, YouTube, Vine, just to name a few. Most of the respondents accessed their social network accounts via their computers. However, a growing number of them are doing so via their mobile phones (and hand held devices like tablets/phablets), which supports the assertion that mobile phone revolutions are on the increase in Africa (Jidenma, 2014) – and that Africa is a mobile only continent (Shapshak, 2012). This also indicates a great potential for the growth of mobile commerce (m-commerce).

Most online vendors use their social network accounts for advertisement (sales promotion). This supports the assertion that online advertisements would overtake traditional print media such as catalogues and magazines (Takahashi, 2011).  They also use it for raffles and competitions, where customers are rewarded for their loyalty. It was also observed from the study that little (or no) trend analysis is being done by online vendors. This doesn’t really look good as it would be difficult for such vendors to understand their customers and thus satisfy their needs fully. A small percentage (50%) of vendors also use their social media outlets for lead generation (i.e. mostly start-ups).

The study also found that electronic payments are a challenge to both Ghanaian shoppers and vendors online. The blacklisting of the country by PayPal is a worry, as there is no ‘formalised’ platform electronic payments can be made on. Newer platform such as mPowerPayments, Everzero, Ozinbo Pay, are yet to get the needed patronage. As late adopters in the online payments market, Ghanaians have their reservations, and would rather employ tried and tested platforms like PayPal. Security is a great concern and a challenge for online shoppers. Such shoppers are worried of the standards being followed by Ghanaian vendors in ensuring secured transactions.

Other challenges being faced in the e-commerce market space in Ghana include vendors’ wish for a solution that would make it less expensive to ship outside Ghana. As shoppers, the slowness of the internet is a major challenge being faced. Also as most of the identified vendors are located in the capital, Accra, delivery and pickup is another challenge faced by online shoppers.

On the issue of whether social media has influenced the growth of e-commerce in Ghana, both online shoppers and vendors are equally found on both sides of the continuum. This means a lot more work needs to be done, by vendors mostly, in leveraging social media to market their products and services. Also such networks should extend their e-commerce capabilities to African countries, to enable their users enjoy such benefits. This would go a long way in increasing the revenue of online vendors.

The study has shown (however premature it may seem) that social media indeed has influenced the growth of electronic commerce in Ghana. Though it is in its infancy, e-commerce has a bright future with the alternative of using mobile money as a means of electronic payments. The trend of Ghanaians having mobile phones and using them for online activities sets the tone for mobile commerce implementation in the country. Further research should be done in finding a solution to leveraging mobile money on the internet such that online shoppers can pay for products and services via their smart/feature phones.

NB: I had a handful of respondents for this study, especially vendors.

If you are a vendor, please take this survey.

If you buy online, please take this survey.

Thanks.

Do not forget to add your thoughts on this phenomenon via the comments section.

REFERENCES

Jidenma, N. How Africa’s mobile revolution is disrupting the continent. http://edition.cnn.com/2014/01/24/business/davos-africa-mobile-explosion/ Retrieved on 12^th April, 2014.

Shapshak, T. Africa not just a mobile-first continent – it’s mobile only. http://edition.cnn.com/2012/10/04/tech/mobile/africa-mobile-opinion/ Retrieved on 30^th April, 2014.

Takahashi, D. Internet Ads Finally Surpass Newspapers. VentureBeat, April 14, 2011.