• Thursday, February 29, 2024
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How we created an e-commerce ecosystem in Nigeria – Massimiliano Spalazzi

How we created an e-commerce ecosystem in Nigeria – Massimiliano Spalazzi

Massimiliano Spalazzi, who has served as the CEO of Jumia Nigeria for the past four years, is set to step down by December 31, 2023, paving the way for a new leader to guide the company’s operations. Massi, however, has been with Jumia since its establishment eleven years ago and has witnessed every phase of the company’s growth. In this interview with BusinessDay’s Frank Eleanya, he provides insights into the strategic steps the e-commerce giant took to establish a thriving market for e-commerce in Nigeria and beyond.

You have been with Jumia since it was founded in Nigeria, till you became CEO and now leaving the company. What has your journey been?

I joined Jumia 11 years ago at the company’s inception in 2012, as a member of the founding team at that time responsible for the marketing department. Our goal was to build the first e-commerce platform in the country as there was a clear need on one hand for our customers to shop in a convenient and trusted way, while on the other for the vendors and partners to grow their business and reach many more clients across the country. Since day 1, we focused on delivering a great experience for all our stakeholders which allowed us to grow and gain traction in Nigeria and quickly become the #1 e-commerce player in the country.

We then expanded in 2013 our operations in more than 10 countries across Africa t. In 2015, we introduced the fintech arm, JumiaPay, a significant addition that complemented our e-commerce operations, allowing customers to make purchases through various payment methods.

Our growth and expansion continued leading us to one of our biggest milestones in 2019 when Jumia became the first Internet Company based in Africa to be listed on the New York Stock Exchange.

Subsequently, amidst global challenges, such as the COVID-19 pandemic, the relevance of e-commerce became even more evident. Jumia played a pivotal role during this period, supporting customers who relied on online services for essential needs and assisting vendors transitioning to the digital landscape. Since then and up until today, our focus remained the same: to offer our customers a trusted platform where to find the best prices and widest assortment, particularly now that cost of living and inflation had a significant impact on people’s purchasing power.

My personal journey at Jumia has been rewarding. Starting as a marketing manager at Jumia, I progressed to become the Managing Director of Jumia Market in Nigeria, at the time the marketplace business model for Jumia Group. In 2015 I became EVP Jumia Group and I took over as CEO for Jumia Market for Africa managing several countries across the continent. In 2020 I was appointed as the CEO of Jumia Nigeria, the largest of our operations. I am privileged to have been part of this remarkable journey from its inception to my current role.

What convinced Jumia that e-commerce could work in Nigeria given the digital penetration rate at the time was very low in 2012?

When I arrived in the country, it was evident that the traditional retail landscape posed significant challenges for consumers. Shopping involved navigating through informal retail stores and multiple markets, not to mention the hassles of traffic and frequent stock unavailability, often consuming three to four hours of time for each customer. Recognizing this, we were convinced of the need for a more efficient and convenient way for people to shop all their needs.

As digitalization gained traction, it became clear that e-commerce could address these needs. Our vision was to provide customers with a simple, convenient, and trusted platform for purchasing products. However, we were aware that this transition required substantial education and adaptation. Vendors needed to embrace concepts like ‘cash on delivery,’ wherein products were handed over to Jumia before payment, ensuring the customer received their order before payment collection.

Additionally, building an online reputation was a novel concept that required a shift from traditional offline practices. Logistics was another challenge, as last-mile delivery of digital products was not widespread. Despite the immense opportunity, making this vision happen concretely demanded considerable effort and dedication.

How were you able to address issues in logistics?

In Nigeria, logistics poses a significant challenge, exacerbated by infrastructural limitations. Over the years, we focused on building a network of logistics partners – many of which launched their businesses thanks to Jumia – who trusted us to invest time and resources to grow their fleet as Jumia expanded across the country. This allowed us to foster scalability and facilitate the inclusion of additional players within the Jumia ecosystem. This collaborative approach ensures competitive pricing, ultimately translating into the best value for our customers. Moreover, we established numerous pickup stations nationwide in 2022 which allowed us to extend our reach while offering to our customers an even more convenient way to shop online with lower delivery fees.

What goal was paramount when you led Jumia Nigeria as CEO?

Upon assuming the role of CEO Jumia Nigeria in 2020, we had to quickly adapt our strategy to the “new normal” in the face of unforeseen challenges, particularly the impact of the COVID-19 pandemic that unfolded just three months into my tenure. This presented a unique opportunity for our business on the supply side: vendors and brands, previously hesitant about establishing an online presence, quickly shifted their stance, acknowledging the imperative to do so immediately.

From day one, my primary focus has been to allow the leading brands in Nigeria to build their identity on Jumia through their Official Stores. On one side it gave the chance for brands to build their online presence on the largest online retailer in the country, while on the other it built even more trust for customers to shop the brands they liked , at the best price. The accelerated adoption of e-commerce allowed us to rapidly integrate numerous brands, enriching the offer for our customers.

In 2021, our focus shifted towards reinforcing the trust among consumers — a vital factor in this competitive market. We aimed to create an environment where customers felt confident in making repeated purchases, knowing that we could consistently deliver on our promises by widely communicating the availability of cash on delivery and free returns, and fast delivery.

Heading into 2022, our focus centred on fostering robust growth by eliminating barriers to entry for online shopping. Initiatives such as offering free delivery for orders exceeding specified thresholds were instrumental in making online purchases both accessible and sustainable and drive the growth of our customer base. This approach resonated well with consumers, particularly those hesitant to commit without firsthand experience of our service.

Our achievements in onboarding leading vendors, instilling trust, refining operations, and promoting growth through initiatives like free delivery have laid a solid foundation for this continued success.

Lastly, what leadership principles or philosophies guided you throughout your tenure as the CEO?

As a founding member of our company, several key leadership principles have driven me throughout the years. Two particularly stand out: “Do what is right and not what is easy” and “when there is a will, there is a way”. This moral compass has steered our decision-making process, even when faced with challenging situations. It’s a reminder that play for the team and integrity are non-negotiable in leadership. Doing the right thing, even when it’s difficult, has always been a fundamental value for me and our organisation.

These principles have not only shaped our values at Jumia but have also been instrumental in our growth and the positive impact we’ve had on customers, vendors, partners and last but not least our teams.

Beyond those values, there are core principles which allowed us to drive the business never forgetting who we serve, our customers and vendors:

For our customers: trust and convenience. We understood fast that trust comes first in our markets. We made this our obsession from day 1. Convenience was equally important, as we aimed to make their lives easier and more efficient by providing seamless online shopping experiences.

For our vendors: “easy, better, and bigger” business opportunities. By streamlining processes, providing resources, and fostering mutually beneficial relationships, we aimed to create an ecosystem where vendors could thrive, innovate, and expand their businesses online.

For our teams: We firmly believed in empowering our talented colleagues. Many of them have now become alumni and successful entrepreneurs in Nigeria and Africa. We understood that our company’s strength lay in the dedication and expertise of our people. We fostered a culture of collaboration, continuous learning, and personal growth, encouraging our team members to take ownership and initiative. We knew that without our exceptional teams, there would be no company.

These leadership principles have been the North Star of my tenure as CEO. They’ve not only helped us become the largest online retailer in Africa but have also shaped our legacy as a company that prioritises trust, convenience, and talent empowerment. I’m proud of what we’ve achieved together, and I’m excited to see the continued growth and success of the company and the incredible individuals who make it all possible.