Toy Entrepreneur’s Roadmap Towards E-Commerce as a Business in Nigeria

The world has drastically shifted from the traditional mode of operation to the full adoption of digital patterns and opportunities within it. This has given rise to the growth of various sectors including e-commerce, which enables toy sellers to trade online. More people are being directed to internet-centric platforms for buying and selling due to increased mobile penetration and internet connectivity, which ultimately leads to accelerated revenue growth in the industry.

To be clear, e-commerce (electronic commerce) is the buying and selling of goods and services with the exchange of funds over the internet. This usually happens with or without proximity. A retailer can sell to people scattered all over the world with the logistics provided. This form of business is driven by technological advancements, including websites, social media, and mobile applications.

The COVID-19 pandemic has significantly impacted e-commerce, which had previously seen moderate engagement rates, especially for giants like Amazon and eBay. Due to the prolonged stay-at-home lockdown, demand for products and services has skyrocketed, leading to a rise in online businesses. Toy retailers have created platforms like Instagram to sell on. Online stores allow customers to buy and pick up products at their location, with terms and conditions set for online retailers. The US Census Bureau estimated that global e-commerce sales in 2020 were $284.1 billion, a figure that has since surpassed due to widespread adoption by brick-and-mortar businesses.

The rise of e-commerce and technology has led to numerous challenges that have impacted global business operations and raised concerns among business owners around the world, including:

Limited consumer experience with the product:

E-commerce is a digital platform where products and services are sold online, and customers can view and analyze the service to a limited extent. This is different from physical shopping, where customers can directly feel the item. For example, a customer may buy a large toy vehicle online but receive a smaller one, leading to disappointment and unfulfilled expectations. This is particularly problematic in the toy industry, especially in Africa, where customers often have to pay to return unwanted products, which reduces the level of trust in toy companies.

Banking and payment restrictions:

E-commerce payment platforms are inadequate and fraught with difficulties, leading to confusion among buyers and sellers. Consumers often demand “cash and collect” payment methods, which can result in losses for sellers and toy business owners. Poor data, internet connectivity, and reduced consumer confidence contribute to the challenges facing the e-commerce toy industry.

Also read: Supporting the rural economy through e-commerce

Regulatory concerns:

E-commerce is plagued by unregulated rules that allow anyone to operate without proper checks. Fraudsters often defraud victims, stealing money and undermining customer confidence. To combat this, strict internet censorship by associations and a merchant accreditation council are needed. This would help protect consumer confidence and reduce negative perceptions of the industry.

Technical and cyber security threats:

Retailers store consumer data and transactions on their websites, which enhances the shopping experience and repeat customer strategy. However, poor cybersecurity can lead to hacking by fraudsters, causing business disruption and irreversible losses. Hacked sites can also steal consumer card information, affecting brand reputation.

Solutions

Customer trust and satisfaction:

The above challenges highlight some of the major reasons for the decline in trust and confidence among consumers. However, with excellent customer service, you can implement effective communication strategies to offer clear purchase and return policies, display customer reviews and testimonials, and ensure that high-quality product images and descriptions are published. This would build a strong brand reputation and if done consistently, consumers would now consider your brand to be reliable and customer-centric, which would lead to trust.

Media skills:

Media literacy is the ability to access, analyze, and evaluate media content and processes. It benefits both buyers and sellers in e-commerce by enabling critical evaluation of information, reducing fraud, and enabling consumers to effectively research and compare products. Retailers can create more effective marketing strategies by understanding the tactics of their competitors.

If media literacy is supported by making it a mandatory course in primary institutions, the e-commerce environment becomes more transparent, safe and user-friendly. Educated consumers are better equipped to navigate the intricacies of online shopping, while businesses can benefit from a more informed and trusted customer base.

Reorganization of regulations:

The Nigerian National Information Technology Development Agency (NITDA) Act and the Nigerian Communication Commissions should revamp their e-commerce policies to mitigate the challenges faced by e-tailers. Implementing accreditation seals on e-tailer websites would build consumer trust and confidence, reduce online fraud and positively impact the e-commerce environment. This would require rigorous verification processes by these bodies.

Data connectivity, infrastructure and development:

Nigerian e-commerce needs to implement AI systems for 3D product testing and establish solid data infrastructures for a stable, fast network. Advanced digital security, including strong external protection algorithms and two-factor authentication systems, is also crucial for the smooth operation of payment platforms and AI-related technologies.

The influx of e-commerce since the COVID-19 pandemic has transformed the industry, presenting both opportunities and challenges that burden the overall operations of business owners in the sector. Therefore, it is imperative to address the myriad challenges faced by the industry by leveraging operational efficiencies and delivering excellent customer experiences so that success can be fueled in the changing landscape of the industry.

Mrs. Omotola Lawson is a toy distributor and government certified instructor in Nigeria.