Over 70% of Nigerians prefer offline shopping due to insecurity and logistics issues

Online shopping in Nigeria

According to a study conducted by Culture Intelligence from RED, 76% of Nigerian consumers prefer to shop offline, citing online fraud, trust, and awareness as overriding challenges.

With the economy progressively becoming cashless due to the increased rollout of digital payment platforms, experts have identified critical factors that inhibit the potentials of the country’s digital economy. Broadband coverage in rural areas is inadequate, and penetration of online payments remain low, as about 33% of the adult population own a debit card, while some 3.6% use it to make purchases or pay bills online.

Among the national focus group curated by Culture Intelligence from RED, 73.7% of respondents claimed that they prefer to shop offline, while 26.3% opted for online shopping. As expected, young Nigerians are most likely to spend online. So, while it is understandable that the older customers are reluctant to do so, an overwhelming majority (76%) of the Gen Z consumers explained that they are more comfortable with offline shopping, citing issues with accessibility, credit card scam, brand trust, and data security.

“Even with the low usage of credit cards and digital payments, e-commerce has grown significantly in Nigeria, especially in 2020,” said Isime Esene, chief intelligence officer of RED | For Africa. “However, the sector is dealing with persistent problems including logistics and delivery issues which continue to turn customers away. Even with Nigeria’s large population, the demand for e-commerce still appears weak, and this is driven by income inequality, brand awareness, and education. Due to these factors, the target market remains small, reducing opportunities for both businesses and customers”.

“We are a country where about 87% is poor, making us the poorest country in the world,” said an expert. “The country also has a middle class that is rapidly falling back down the economic ladder, and millions are slipping into poverty. The potential in the huge population exists when more consumers have more money to spend and have the means to go online to sort through thousands of online products to buy what they need. In this case, the consumer will also have to deal with late or false deliveries or the fear of providing information that cybercriminals can use. At that point, almost everyone wants to avoid the headache”.

The signs are apparent — the future of the Nigerian market is online. With sustainable economic growth and an increase in consumers’ purchasing power, the act of shopping will continue to transition. But while the evidence reveals that many more Nigerians can willfully engage in e-commerce transactions, improved awareness, and security remains paramount to business survival in the sector.

Culture Intelligence from RED supports companies, governments, and change makers with data-backed insight for evidence-based decision-making. It aggregates the ideas, opinions, and behaviours of consumers to solve problems and identify growth opportunities. Insights are drawn from data collected through in-depth interviews and surveys with our 500-member consumer panel spread across the country, including 100 culture insiders, who are leading thinkers and doers across media and marketing.

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