By JONAH NWOKPOKU
Nigeria’s online retailers have started gradual implementation of strategies that will eventually culminate in complete withdrawal of free shipping services.
Vanguard’s investigation of major online retailers in Lagos showed that Nigeria’s online retailer, Jumia.com has restricted free shipping to Lagos and for items above N10, 000. It could be recalled that the retailer, including many others offered free shipping nationwide when they started.
However, Jumia gradually limited the free shipping to Lagos and then imposed N10, 000 and above price benchmark for items that could be shipped free.
On their part, Nigeria’s online marketplace, Konga.com had since inception shipped free nationwide but towards the end of April, 2014, it made a move to end free shipping entirely.
However, from first day of May, the company made a quick turn around and announced it had commenced free shipping again. The company at the time said it was in its resolve to celebrate with Nigerian workers and that it would run the free shipping throughout the month of May. The company had also, within that period, disabled its pick-up centres in Surulere, Ikeja and Victoria Island. The implication was that customers no longer had the option of picking up their ordered items.
When contacted on the move, konga’s Head of Marketing, Gabriel Gab-Umoden told Vanguard that the company has continued the free shipping promo for the month of June and that it would finally end free shipping after the promo and limit offer for Lagos only.
He said: “We are currently offering free delivery nationwide on every order purchased on Konga.com. So, every Nigerian that orders on Konga, regardless of location or order value (no minimum order value), will enjoy free delivery to wherever he/ she is. This has been going on for a month and will continue for another month.
However, after the promo, we plan to continue to offer free delivery on orders delivered in Lagos.”
On disabling the pick-up centres, he said: “Our pick-up centres now serve as drop off points for the many merchants that sell on our platform. This business decision was made so we can offer our merchants an extra avenue to drop off their items for quick delivery to customers. The ‘Drop off points’ will still tend to customer queries/ general assistance as needed.”
Investigations further revealed that Girlyessentials.com, an online shop that specializes in cosmetics charge N700 for to-door delivery. In its website, it noted that, “Epe, Amuwo Odofin, Ikorodu Town, Badagry and some other areas will attract an extra charge.”
The company also said that the cost of shipping to all states in Nigeria will cost N2, 500 except where a customer opts to pick up items at ABC terminals available only on fifteen destinations, then N1, 500 will apply. Also, Fashpa.com, an exclusive online fashion merchant, said it undertakes free shipping but only for orders above N5, 000 and within Lagos only. For them, “All orders of products in Lagos over N5, 000 qualify for free shipping while orders outside of Lagos over N15, 000 will be charged a flat fee of N1, 950.”
Checks on other online retailers like Africdeals.com showed that the firm only offers free shipping on select items which were yet to be named at the time of this report.
Some online customers who spoke to Vanguard on the trend attributed this move to various reasons. Some believe that the free delivery services have started to affect the retailers’ profitability in the face of increasing decline in online retail patronage.
A customer, who simply identified himself as Alex said, “The moves by some of them to end or limit free shipping is a big statement that they have created the necessary attention they need and they are now ready for business.”
He explained that, “It makes some business sense for them to make the move since the operators having offered some free services and sometimes mind boggling discounts just to attract customers, must now take the bold step to start real business and become profitable.”
Also speaking on whether these moves will affect online shopping in any significant way, an industry expert and Co-founder of Supermartng.com, Raphael Afaedor noted that delivery as a service come with costs that must be borne by either the retailer or the customer. He opined that whether this will affect online shopping depends on what drives e-commerce in the country.
According to him, ”The broad business logic here is that delivery is a service and it has cost implications. Someone has to pay for it. If the customer sees the value derived from the service provided, as worth the amount being charged for the service, they will pay for it. If not, then the seller has to swallow it. The key here is that the service has to be valuable enough to the customer that they are willing to pay the price for it. If that is not the case, the customer will look for more affordable alternatives.”
On whether the withdrawal of free shipping will affect online shopping patronage, he said, “It all depends. The key here is determining what is the actual driver behind why people buy online? Some will find the convenience of online shopping to be worth more than the delivery fee. Those will pay. Overall, online shopping also makes it easier for people to easily discover products which they would otherwise not have had known they could buy locally. I think that will also be a powerful driver for people to shop online irrespective of delivery fees, so long as the delivery fee is reasonably priced.”