Grocery and FMCG e-commerce represent a massive growth opportunity for South African retailers at a time when consumers are more aware than ever of the cumulative effect of inflation on their cost of living and are becoming increasingly intentional in their purchasing decisions. But capitalising on this market will demand that retailers provide an optimal mix of value and convenience for consumers who feel like they are paying more and getting less.

Gareth Paterson

That’s according to Gareth Paterson, director of client strategy at Nielsen IQ (NIQ) South Africa, who moderated a panel discussion at Converge 2025 on 8 May, the premier event for Africa’s digital commerce ecosystem taking place in Cape Town this week. He says that international experience shows that the opportunity for FMCG retailers and brands grows rapidly as the e-commerce market matures.

“Despite the growth of ‘quick commerce’ grocery deliveries in South Africa since the pandemic, the market remains in the early phases of its maturity,” Paterson adds. In more mature e-commerce markets that NIQ tracks, e-commerce share of value for FMCG is comparable to e-commerce share of value of tech and durable (T&D) goods. In South Africa, however, FMCG share of value of e-commerce is only around 2% compared to 17% for T&D.

This gap between share of value in FMCG and T&D shows that the e-commerce market in South Africa is far from saturated. This presents exciting opportunities for FMCG manufacturers and broad-based retailers. “Our data shows that online T&D sales grew by 11% in 2024 as consumers sought better deals online. We expect to see a similar appetite among grocery shoppers for finding value and convenience on digital platforms,” says Paterson.

“However, growth will likely vary significantly by category - items like personal care, diapers and fragrances are poised to grow faster, while fresh produce may continue to lag due to higher barriers to entry.”

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