OWN CORRESPONDENT, Johannesburg | Wednesday 7.00pm
SOUTH African consumers will spend R2,7-billion in Internet-generated purchases this year, while business-to-business e-commerce will reach almost R4- billion, a new survey by Acuity Media Africa claims.
The second South African Web Commerce Survey shows consumer spending generated by the World Wide Web grew by 140% in 1998, from R500-million to R1,2-billion. The survey, due to be publicly released later this month, predicts that e-commerce will rise at least another 125% this year.
The biggest growth areas are online investment, car and property sales and general retail. Business-to-business transactions will however, the survey claims, overtake consumer spending for the first time this year after a dramatic rise from R15-million in 1997 to R207-million in 1998.
The growth to R3,9-bilion forecast for 1999 is largely a result of companies moving existing client relationships from a physical transaction to an online transaction, says AMA director Arthur Goldstuck. Health care, he adds, will make the single biggest contribution. Further key findings include predictions that business to business e-commerce will grow dramatically but without much impact on wider economic growth. The key success factor behind business-to-business e-commerce over the next five years, AMA says, will be the extent to which businesses integrate their existing supply chains with the Internet.
The explosive growth witnessed so far in 1999 is based largely on the transfer of existing business transactions into an e-commerce environment, rather than new business being generated by e-commerce. The key economic benefit will be dramatic cost-cutting in supply chain management. The survey also finds that business-to-consumer e-commerce will make a far greater impact on the growth of individual companies.
The survey claims that consumer-oriented e-commerce will remain a small market for the next four years but will rely less on the “cannibalisation” of traditional business.