‘Why Nigeria’s eCommerce sector is still underdeveloped’
Co-founder and Chief Executive Officer of Glovo, a multi-category delivery app, Oscar Pierre, in this interview with ADEYEMI ADEPETUN, speaks about the electronic commerce sub-sector and how fresh investments and players are driving initiatives.
Looking at the Nigerian tech ecosystem and the surge in eCommerce platforms, what opportunities exist to develop the ecosystem?
I can say that the Nigerian tech ecosystem is vibrant. I have heard about startup innovations in Lagos and other cities in Nigeria and how investors are willing to invest in the tech space. With the type of innovation that is coming out of Lagos, the city is fast becoming the fastest-growing tech hub in Africa and I am excited about the growth and the pool of technology talents and companies that are coming out of Nigeria. So, I can say that the opportunities far outweigh the challenges.
How crucial is the Internet infrastructure to the business?
Ubiquitous access to the Internet is a challenge, not only in Nigeria but also in other countries. The development will not stop Glovo from investing in the Nigerian market even though our business depends heavily on Internet access. Yes, there are some challenges in Nigeria, regarding Internet connectivity, but access to the Internet is improving and our team is constantly building solutions that are helping stores and couriers to improve their data plans and Internet connectivity.
At what point did you discover the opportunities that attracted the firm to Nigeria?
Glovo started as a food delivery business in 2015 and we discovered that many people liked our business model and we decided to expand the business. While our competitors were focusing mainly on cities, we went beyond cities to underserved areas and decided to explore the African market and that was the point we saw the huge business opportunities in Nigeria and we established the Glovo business in Nigeria in 2021.
Nigeria’s business environment is judged to be very tough. What is your experience?
One of our greatest challenges in doing business in Nigeria is traffic but we are getting over it because we have a strong value proposition for business. The issue of connectivity is also a challenge because people need to be connected to the Internet to make orders and we need such connectivity to take orders for delivery. The issue of connectivity is not peculiar to Nigeria, as we face the same challenges in other regions where we operate.
What have been the impacts of your business on the Nigerian environment?
The impact has been massive. Our services and solutions are impacting sellers and buyers in Nigeria. Glovo is the first online channel and we partner with supermarkets, where we offer them everything that will enable them to do online business with their customers with ease. We offer them logistics, customer service, and an online platform for transactions. That changes the whole perspective of the business. The restaurants that largely depend on offline customers for their sales now have online customers, who order food online and we deliver to them. So what we have done is to use our solution to offer services to customers and clients and the impact on customers and the Nigerian business is huge.
eCommerce business is capital-intensive across the globe. How easy has it been for platforms like yours to raise funds?
Since the inception of the Glovo business in 2015, we have been able to raise as much as Euro1.2 billion, but we started the Nigerian business in 2021. Food delivery is a massive industry in the world and it will continue to grow big because the demand is huge and increasing year-on-year.
So, the business needs money to grow and be sustained. As far back as seven years ago, the industry started attracting investors because every investor knew that it is a massive industry with potential growth capacity. It is not just about raising funds, but about investors, who understand the business and are ready to invest in the business. I see it as a profitable business and I believe Glovo will become profitable in a couple of years to come. In Nigeria, the business is growing gradually, but we are currently funding it from the proceeds of our business from other regions of the world.
What gap is Glovo bridging in the country’s e-commerce space?
The e-commerce space in Nigeria is underdeveloped, and this is largely so because I think nobody has been able to build a very solid platform that offers different kinds of services that will drive e-commerce growth in the country. So Glovo is trying to bridge that gap by building different categories of services on our platform that are driving e-commerce in the country. Every week, we sign up new restaurants and businesses like groceries, pharmaceuticals, flowers and electronics on our platform and we deliver to customers in minutes. We are also educating people on the ease of making online orders that will be delivered to their doorsteps with ease and in minutes. We deliver thousands of orders daily and the business is growing gradually and customers are beginning to enjoy our prompt service deliveries.
Can we appraise your level of investment in Nigeria?
We have invested a few million Euros in the Nigerian business since its inception in 2021 and we are still investing. Our investment in Nigeria is channeled towards building the team, the couriers, as well as in marketing and sales. Today we have scaled our operations in Nigeria and we have delivered over a million orders and the growth is impressive. For now, we are still investing and we will continue to invest until we grow the market to a sizable level.
How is logistics in Nigeria, in terms of deliveries?
Our logistics are mainly last-mile deliveries. All our logistics take place within a specified location, which makes management of our logistics a lot easier. We do not involve ourselves in across-city deliveries, we only deliver orders from one point to another within a particular location and this helps us to manage our motorbikes and riders. So we deliver within 45 minutes within a city.
So, what is the current market share of Glovo in Nigeria and what is the expansion plan?
Beginning from countries in sub-Saharan Africa like Kenya, Cote d’Ivoire, Ghana, Uganda, including Nigeria where we have been operating for some time now, we do have some good market share of our delivery business. Among the African countries where we have presence, Nigeria is the fastest growing market for us at Glovo. We have signed up several partners and customers and the business is doing well in Nigeria. Currently we are operating in three cities in Nigeria, and we plan to expand to more cities soon. We have over one thousand courier operators in Nigeria that are active, the number of restaurants and shops that have signed to our platform is on the increase.
Your background is in aerospace technology, but today you are an entrepreneur. What inspired you to entrepreneurship?
My journey from aerospace technology to entrepreneurial space is an interesting one that is driven by passion. I first worked for a very large aerospace technology company but at a point, I became bored because I was no longer enjoying what I was doing there, so I decided to resign and stayed with my parents in Barcelona, Spain while thinking of what to do that I am passionate about.
During that period of stay with my parents, the idea to start a food delivery business was developed in my head, and I decided to give it a trial. My experience with Glovo has been fantastic because I am passionate about the business and I have been able to build a very strong team that is also driving the business to greater heights.