Amazon has identified same-day delivery as a key strategic play in its battle to grow market share after the US-headquartered online retail giant commenced operations in the country on Tuesday.

Speaking in a podcast on Wednesday, Robert Koen, Amazon’s MD of sub-Saharan Africa, said it has identified that South Africans desire a sense of security around the delivery promise when shopping online as this allows them to plan effectively around the delivery schedule.

“We are doing same-day or next day delivery in most major centres,” said Koen in the podcast interview with Business Day. “It is important for South Africans to be able to experience some of the nuances within the store around delivery expectations. It’s great to know when something is going to be delivered to you and you can plan around that.”

According to Koen, executing well on logistics is part of Amazon’s effort to give South Africans a “great experience” when shopping online. Amazon plans to supplement this with a wide product selection and great value for money in its strategy for penetrating the South African market, he said. However, Amazon’s product line-up at launch is fairly limited – and not even its own-branded electronics products such as the Kindle and Echo smart speaker range are available yet.

A network of around 3 000 pickup points nationwide, operated by third-party logistics firms, is in contrast to homegrown incumbent Takealot, which does its own fulfilment. Koen said Amazon has partnered with two local last-mile logistics partners to help it: DPD Laser and The Courier Guy.

Koen said hassle-free returns and good customer support are also important. Amazon has live agents working seven days a week from 6am to midnight to attend to customer queries, he said.

Local call centres

The call centres are run and managed in South Africa, with support agents able to assist in multiple languages.

At launch, amazon.co.za is offering around 20 product categories, with brands ranging from beauty and books to home and kitchen, load shedding solutions, pets, and toys.

Beyond offering established brands, Amazon is widening its product selection through the addition of smaller, local sellers on the platform.

“[We offer] the brands that we know South Africans love – Samsung, Apple, Loreal, Lego, etc – and then there are a number of smaller brands as well, local sellers that are offering their products in some cases for the first time in South Africa online,” said Koen.

He admitted that Amazon has launched into a competitive market, with the likes of Takealot, Shein and Temu all vying for market share, along with a host of physical retailers that are also venturing into the online space.

“There is heavy competition in all the countries in which we operate, but I think what makes us unusual is we definitely don’t focus on what our competitors are doing. We have found that the success formula is to really focus on our customers. That is where our focus will be, on the customer, not on the competitor,” said Koen.

Nevertheless, Naspers-owned Takealot — which is seen is Amazon’s most direct competitor in South Africa — last August announced that it was testing one-hour deliveries in parts of Cape Town, where the company’s headquarters are, before expanding the initiative to the rest of the country. – © 2024 NewsCentral Media