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Massmart’s ambition to grow e-commerce to 15% sales participation in the next five years

By , Portals editor
Africa , 30 May 2022

Massmart’s 100% acquisition of local last mile delivery firm, WumDrop, is part of a multi-year e-commerce strategy that has seen the group buy up a number of innovative companies to strengthen its capabilities in last-mile delivery.

The 100% acquisition was completed in July 2021, after Massmart had initially acquired a 53% stake in Wumdrop in 2017.

Simon Hartley, Wumdrop Founder & Massmart Delivery Services Executive, said despite being wholly-owned by Massmart, WumDrop continues to provide on-demand and flexible same-day delivery services to other clients in a number of sectors, including banking and fast-food.

“They do not only service Massmart stores,” he told ITWeb Africa. “WumDrop’s proprietary technology empowers it to optimise efficient routes at short notice, deliver directly to mobile phone locations in cases of poor address data, and interactively improve address and geolocation data on its network over time. This technology allows Wumdrop to help its driver network earn more, deliver faster and more accurately, with lower costs to clients.”

Massmart’s growth ambition

Sylvester John, Massmart Senior Vice President for e-commerce, said Massmart is currently the number one retailer across general merchandise categories, and the second highest website traffic generator in South Africa.

“Our aim is to grow e-Commerce to 15% sales participation in the next five years," said John and to achieve this, the company is rolling out a phased approach.

The first phase is to build strong foundations and operational infrastructure. “This has been achieved through a new centralised and much expanded e-commerce structure in our head office, our increased investments in technology (including a very large and dedicated support team in Walmart’s global tech hub in Bangalore) and the creation of new e-commerce leadership roles along with new fulfillment technology in our stores to improve the way we serve online customers,” said John.

The second phase is to enhance customers’ digital experiences, and to do this, Massmart is using enhancements to the existing Makro & Builders websites and the recently revamped Game website, which includes the availability of new categories online, such as clothing and liquor.

“All of these developments are focused on a mobile-first user experience, in line with the higher rate of mobile browsing in South Africa,” John added.

The third phase is about offering greater speed and convenience for customers.

John continued: “This phase is largely enabled by our acquisitions of OneCart and Wumdrop. OneCart offers a customer facing marketplace proposition where orders can be placed for on-demand deliveries from retailers such as Makro, Game, Woolworths and others. Wumdrop is a pure last-mile delivery operation that allows Massmart’s brands to offer a faster delivery promise to customers.”

The fourth phase is centred on offering customers the broadest assortment and best user experience. Massmart said it will collaborate with suppliers and other partners, with the aim to grow its online “shoppable range” by 65 times in five years, and “to truly become a one-stop-shop for both our B2B (business) and B2C (retail) customers.”

“Significant progress has been made across all of these phases, as evidenced in our e-commerce results from 2021,” John added.

Wumdrop said it has grown quickly from a small local delivery start-up "into one of the most trusted delivery services in the country", with an average customer rating of 96% on its app and 4.9/5 on Google from over 2500 customer reviews.

Its user interface connects drivers with customers, allowing them to interact in real time, ensuring that deliveries are concluded accurately and seamlessly. The service continues to be rolled out across the country serving Massmart stores and other businesses.

Hartley says, “As an end customer, you may never know you’re interacting with WumDrop directly, given its seamless and effective representation of the client business. Improved customer experience, consistency and accuracy are WumDrop’s points of differentiation, in relation to faster delivery times, real time customer communication, driver tracking, and more.”

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