eCommerce is booming in South Africa – but there is a catch

South African spending online is growing five times faster than in-store spending. However, local shoppers still enjoy visits to shopping malls and engaging with items physically, with the immediacy of a physical purchase remaining attractive. 

This was revealed in Discovery Bank’s SpendTrend24 report, compiled in collaboration with Visa. 

The report compiled data from Discovery Bank’s clients in South Africa and data from over 60 million Visa cards worldwide and over 3 billion transactions. 

Discovery Bank CEO Hylton Kallner told a media briefing that the research aimed to understand where and how South Africans spend their money. 

In the 2024 edition of the report, Discovery Bank and Visa also took a deeper dive into the spending habits of South Africans across the country’s three major metropolitan areas – Joburg, Cape Town, and Durban. 

This was then used to compare how South Africans spend their money in these cities with their global counterparts in emerging markets and developed nations. 

Despite a challenging macroeconomic environment, South Africans proved resilient in 2023 compared to their global peers, with spending growing slightly. 

Another trend was the rapid shift towards online shopping in South Africa, with online spending growth outpacing in-store by five times. 

The pace of this growth even surpassed other emerging market cities and was on par with cities in developed economies. 

Despite this trend, Euromonitor research indicates that South Africans still value physical shopping experiences, enjoy visits to shopping malls and browse in stores, even if they don’t intend to buy anything. 

Many South Africans also compare prices online regularly but prefer shopping in-store for the immediacy of purchase.

Social commerce is also growing, with 25% of local consumers reporting they recently made a purchase through social media. 

Discovery Bank expects both in-store and online purchasing to see balanced growth as retailers integrate omnichannel sales strategies. 

Consumers increasingly expect a seamless shopping experience that combines the immediacy of online shopping with the tactile experience of in-store shopping, it said. 

The pace of growth in online shopping is shown in the graphic below. 

South Africans are also increasing their shopping from international platforms while spending in-store at international destinations is growing at a slower pace. 

Discovery Bank said this can be attributed to emerging streaming, gaming, and international eCommerce growth.  

There has also been a rise in global online eCommerce platforms delivering to South Africa, with improved logistics and delivery times.

In particular, spending on international entertainment is growing rapidly, showing the fastest growth among South Africans, in general, and Discovery Bank clients. 

This is mostly due to increased online ticketing and sports entertainment transactions. The sports entertainment industry saw significant growth – from R8.8 billion in the 2019/20 financial year to R23.7 billion in 2022/231. 

Discovery Bank spending data shows a surge in online betting during events like the Tour de France, followed by the 2023 Rugby World Cup and the ICC World Cup. 

Since the start of the pandemic, online streaming services for content such as music, series, and movies have emerged as a key source of entertainment. 

The graphic below shows the growth in South African spending on international eCommerce platforms and entertainment. 


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