How online marketplace drives growth for Nigeria’s auto, real estate businesses

Nigeria’s digital space is flourishing and with the growing internet penetration currently at 55 percent, it is poised to continue.

Research has shown that digital transformation is reforming businesses as owners embrace online marketplaces to reach a wider audience, streamline operations, and adapt to changing market dynamics.

A recent forecast by Statista shows that 13 percent of all sales done in Nigeria by 2026 will be online.

Platforms like Jiji, Jumia, and Konga are now key players in this digital revolution. Businesses are leveraging them to achieve significant growth, overcome challenges, and stay competitive.

Rise of online marketplaces in Nigeria

With smartphone adoption estimated to reach 140 million by 2025, consumers are more connected and now shifting to e-commerce. This connectivity has paved the way for platforms like Jiji to transform businesses. They offer them a powerful tool to reach customers beyond their immediate geographic location.

For automotive and real estate businesses, online marketplaces provide an invaluable platform to showcase products and services. These platforms not only offer a space for listing items but also come equipped with tools that help them optimise their listings, engage with customers, and track performance.

Buying and selling of cars online

The automotive sector has also seen substantial growth through online marketplaces. Platforms like Jiji, Carmart, and Cars45 offer a unique opportunity to reach customers who are actively searching for vehicles online.

Dealers now lean on some of these online marketplaces both for selling and buying cars.

Raymond Iyoha, CEO of Autoproject, a dealer partner with Cars45, has been sourcing verified cars through the platform and he shared one of his biggest challenges before using the platform.

“Our biggest challenge was getting the right car to buy. Sometimes, we end up buying vehicles with security issues. But since partnering with Cars45, when it comes to verification, I’m rest assured,” Iyoha said.

Autoproject has been sourcing verified cars to increase their inventory, without having to travel as all is facilitated through the online platform.

Levi Bereiweriso, a business owner specialising in selling cars on Jiji’s platform, shared firsthand experience of selling online.

“Jiji has helped me to stay connected, to stay competitive in the car-selling business. I’ve sold numerous cars to customers all over Nigeria and made profits. That’s because over 95 percent of people who reach out from the platform are genuine and interested buyers,” Bereiweriso explained.

Through Jiji, he can reach a wider audience, engage with genuine buyers, and ultimately increase his sales by listing his vehicles online.

One of the key advantages of selling cars through online marketplaces is the ability to provide detailed information and visuals that help buyers make informed decisions.

Unlike traditional methods, where potential buyers might have to visit multiple dealerships to compare vehicles, online marketplaces allow them to do so from the comfort of their homes.

Likewise, dealers now source verified vehicles from the comfort of their offices hassle-free. These translate to cutting costs and reducing documentation issues and security concerns.

Breaking market barriers for real estate businesses

One significant success story in the realm of online marketplaces is the real estate sector. Traditionally, real estate transactions have been heavily dependent on local networks and word-of-mouth referrals.

With the advent of online marketplaces, real estate businesses are now able to tap into a much broader audience, including international buyers and investors.

For instance, Tope Samuel, managing director of Befitting Properties, a real estate firm in Lagos, explained that the business leverages platforms like Jiji to boost visibility and reach potential clients both locally and internationally.

“Jiji’s wide reach, user-friendly interface, and the ability to directly connect with serious clients made it our preferred platform. We’ve closed some of our biggest transactions to date on the platform including a premium property worth close to N1 billion in Banana Island,” Samuel said.

The success of Befitting Properties showcases the power of online marketplaces in helping sellers in real estate overcome traditional barriers. When they advertise their properties online, they can showcase high-value listings to a diverse audience.

Navigating challenges using online marketplaces

The economic outlook in Nigeria has been marked by volatility in recent years. This is evident in inflation rates going up to 34.19 percent in June, and slightly easing off to 34 percent in July 2024.

This presents a challenge for businesses on how to maintain growth and profitability in a fluctuating market. Online marketplaces have become a lifeline in this regard, offering businesses the tools they need to adapt to changing consumer behaviour and market trends.

For instance, De-Supreme Property, another real estate business, faced the challenge of limited marketing budgets when starting.

However, exploring the affordable ad packages that Jiji offers, enabled the business to gradually scale its marketing efforts as it grew.

“When I started my business in 2020, I had nothing. Jiji helped me begin with small ads on their platform and over time, I was able to increase my investment and expand my business,” said Abati Idowu Waheed, CEO of De-Supreme Property.

Scaling marketing efforts according to business needs is one of the many ways online marketplaces support SMEs. Small businesses with a limited budget and more established companies looking to expand their reach, can ride on these platforms to cater to their different needs.

Role of credibility in sales

Building trust with potential customers is a big challenge for online sellers. Credibility is crucial in a digital space where buyers cannot physically inspect products or meet sellers in person.

One online marketplace that addresses this key challenge is Jiji through its meet-inspect-pay model. They provide features such as customer reviews, verified ID badges for sellers, and secure communication channels like WhatsApp and in-app chats.

For Befitting Properties, maintaining a strong reputation in Jiji with over 1000 positive feedback from customers through the platform in five years has helped.

“Being active on Jiji has enhanced our reputation as a trusted and reliable real estate company. We can say on average, over 90 percent of our customers are satisfied which has solidified our relationships with them and boosted referrals for our business,” Samuel said.

Similarly, Bereiweriso’s success in the automotive sector is partly due to the trust he has built with his customers.

He has been able to establish a strong reputation that continues to drive sales, by engaging with genuine buyers and providing accurate information.

This trust is further reinforced by Jiji’s verification processes, which help ensure that both buyers and sellers have a positive and secure experience on the platform.

Future of e-commerce

The role of online marketplaces in driving growth will only become more prominent as more businesses recognise the benefits of selling online.

For SMEs, the opportunity to reach a global audience, leverage advanced marketing tools, and build credibility in a competitive market is invaluable.

However, the success of these efforts depends on how well businesses can adapt to the digital environment and make the most of the features that platforms like Jiji offer.

As digital commerce continues to evolve, those who are willing to embrace it and leverage its full potential will be poised to succeed in the years to come.

For businesses that have yet to explore this avenue, the time to start is now. The digital future is here, and it offers unlimited opportunities for growth and success.