Amazon is coming to Nigeria
Amazon,
the world's largest e-commerce company, will most likely disrupt the
Nigerian e-commerce sector when it launches in the country in April 2023.
Amazon will compete against the two leading competitors in the Nigerian
e-commerce industry, Jumia and Konga.
Amazon,
which presently operates in 20 countries, is focusing on long-term development
as it expands its US-based operation.
According
to a Business Insider source, the company will expand to Africa, Europe, and
South America while having its headquarters in the United States. Belgium,
Chile, Colombia, Nigeria, and South Africa are the countries on Amazon's
expansion list.
Amazon has been reportedly hiring salesmen and
engineers in Lagos, implying a growth of its operations in Africa's largest
economy. In addition, the business has recruited a big advertising firm, Insight
Publicis to focus on its initial push for Prime Video subscribers in Nigeria,
as well as funding local film and television studio development
such as Anthill Studios and
Inkblot Productions, the producers of the box office blockbuster The Wedding
Party, and licensing arrangements.
“We are investing in the region [and] this is what the
advertising campaigns represent,” Amazon said in a statement.
The e-commerce and cloud computing giant is also
considering expanding its AWS cloud services in Nigeria. AWS is the world's
biggest cloud computing service, with roots in South Africa dating back to
circa 2004. AWS services are already being utilized by businesses across
Africa. Despite the lack of a data center or office, AWS has become a
popular service for many startups and major businesses in Nigeria.
Nigeria has seen a frenzy of data center investments
due to evolving data protection legislation and increased demand for cloud
computing among businesses. Actis, a private equity firm based in the United
Kingdom, invested $250 million in RackCentre, a Nigerian data center focused on
West Africa, in March 2020, and Equinix acquired MainOne, a cloud
computing company and operator of West Africa's first privately operated
undersea fiber cable, in December 2021. Large underwater cable initiatives to
improve internet access in Africa have been backed by big tech firms like Meta
and Google.
In 2016, as part of a global rollout, Amazon launched
its Prime Video streaming service to Nigeria, and its Amazon Web Services (AWS)
service has been utilized by numerous domestic enterprises for several years.
However, outside of South Africa, the corporation has no actual presence in the
continent or in most of Sub-Saharan Africa.
“As more Africans get on the internet and
organizations continue to improve digitization efforts, the demand for digital
services and infrastructure increases,” said Ayobami Omole, an analyst at
Tellimer Research.
Local businesses, however, continue to face payment
challenges because AWS prices are levied in dollars instead of naira, which is
challenging due to the Central Bank of Nigeria's policy banning dollar
transactions in order to support the naira. A local AWS office might be able to
assist you get over that hump.
Africa
has emerged as a key growing market for streaming services, with Disney+,
Netflix, Amazon, Canal+ in France, and Showmax in South Africa all battling for
users. Although Amazon has not revealed data for Prime Video viewing in Africa,
Digital TV Research, an analytics firm, believes that the service has 600,000
members in the continent. By 2027, Amazon Prime Video is expected to attract
1.5 million new customers.
If Amazon starts a branch in Nigeria, this will mean that they will create a lot of jobs in Lagos, Jobs in Abuja, and most likely bring thousands of jobs to Nigeria. Sadly, this will also bring an increase in the cost of living in any area where Amazon decides to house its warehouse in Nigeria.
Be the first to comment!
You must login to comment