THE RETAIL INDUSTRY IN GHANA
“A lot of retailing is done offline“
Overview of the Ghanaian Retail Industry
The retail industry in Ghana has experienced a paradigm shift because of increasing global trends, consumers shopping across both online and offline, and a need for retailers to deliver seamless shopping experiences. It has emerged as one of the most dynamic and fast-paced industry as the consumer is more equipped with information and demands more. The changing taste preference of the consumer has led to international players such as Game, Shoprite, Citydia, etc entering the market. Therefore, understanding the consumer and what they want is imperative in a rapidly growing sector.
In Ghana, a large part of retailing still happens in open-air markets despite a gradual shift to the formal space and ecommerce, which has been spurred by the rise in internet connectivity. Since the introduction of the internet in 1995, several facets of Ghanaian life including economic, social and commerce have been impacted. Most small retail outlets are using social media tools such as Facebook, Instagram, WhatsApp to market and sell products and services.
Retailers who were able to keep up with these trends in the retail space, both existing and potential investors can meet consumers’ needs and gain their loyalty.
Trends Shaping the Retail Space
These trends have influenced the Ghanaian retail space immensely over the past few years.
- E-RETAILER IS THE GAME-CHANGER
Today, the most important trend affecting customer experience in retail industry is the electronic retailing. The growth of internet and social media has totally changed the face of retailing from a purely person-to-person approach, to something much more automated. This has added more shopping features for customers and also a voice to share their shopping experiences thereby shaping conversations around retail brands. Fifty-five percent (55%) of our respondents desire an omni-channel shopping capability from retailers but few retailers do this
- PAYMENT OPTIONS
The revolution in payments brings opportunities and challenges for both online and offline retailers. Although most consumers continue to pay with cash when shopping they are also looking for other payment methods such as, mobile and card payments. Some retailers have employed the use of mobile money to help with the payment process, whilst others continue use the conventional means of payment. From our study 63% of millenials want to have flexible payment options when shopping.
- PERSONALISED SHOPPING EXPERIENCE
The introduction of mobile shopping applications such as DHL Africa, gives consumers unlimited access to products around the world and with that, the power to choose the retailer that offers not only the best price, but also the best experience (Genov, 2018). Our survey found that 58% of consumers are more likely to shop from retailers that provide with products based on their behavior and preferences.
- SOCIAL MEDIA INFLUENCERS
Retailers have associated with celebrities, bloggers on social media to encourage customers to use their brands. This has become an effective way for them to reach and connect with a more diverse group who would not otherwise pay much attention to their brand. A survey by Civic Science (2019) found that 34% of daily U.S. Instagram users bought something because a blogger or influencer recommended it
Comparing online and offline retail shopping in Ghana
Impact of e-commerce on offline stores
The result of our survey indicated that majority of consumers spend up to GHC500 when shopping from both offline and online retail outlets among the three product categories. When asked why they shop offline instead of online, respondents said they get to feel, touch, or even smell a product before they buy it. This gives us them the opportunity to be acquainted with the product before making any commitments.
The top four reasons why people choose to shop offline instead of online include convenience, ease of purchase, promotional offers and wide product range. However though offline shopping allows ease of purchase, there are still areas where it pales in comparison to online. Most shoppers cited cost as a top inhibitor followed by time.