eCommerce booming in South Africa – but shopping malls remain dominant

Online retail is booming in South Africa, with revenue from eCommerce crossing R71 billion in 2023. However, many shoppers still prefer the experience of physical shopping. 

This was revealed by research conducted by World Wide Worx in partnership with Peach Payments and Mastercard South Africa. 

The research showed that online shopping is experiencing a boom in South Africa, growing at around 30% per year over the past decade. 

This has resulted in eCommerce becoming an increasingly valuable part of the economy, with companies generating over R71 billion in revenue from online sales in 2023. 

Online retail’s growth is only set to continue in the future, with research projecting that it will make up 10% of total retail revenue by the end of 2025, up significantly from 6.15% in 2023. 

World Wide Worx’s Arthur Goldstuck said this is a critical threshold for a country to cross in terms of online retail as growth only tends to accelerate past this point. 

This is because the sector then becomes valuable enough for traditional retailers to completely pivot to eCommerce, further increasing accessibility. 

The research from World Wide Worx echoes that done by Discovery Bank and Visa earlier this year. 

One trend their research highlighted 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. 

However, a large portion of South Africans still favour physical shopping experiences and only use online platforms to compare prices or products. 

World Wide Worx’s research showed that nearly 30% of shoppers still prefer the in-person shopping experience. 

Moreover, in-store payments remain the dominant payment method. 

This echoes research by Euromonitor International, which concluded 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 said its research led it to expect 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.