Online retail sales in South Africa grew by 35% in 2024 to R96-billion, representing 8% of total retail sales in the country during that year. Growth has continued so far this year at an annualised rate of 38% and is set to exceed R130-billion by the end of this year and capture nearly 10% of the country’s total retail market.

This is according to the 'Online Retail in South Africa 2025' report produced by technology market research firm World Wide Worx (WWWx).

“Online retail has moved from being an experiment on the margins to a structural force in the economy. Nearly one in every ten rand spent at retail will now be online,” said WWWx CEO Arthur Goldstuck.

“Most importantly, it is not just the pace of the growth, but the breadth of it. We are seeing double-digit increases across groceries, fashion, health and beauty,and value retail. The evidence is overwhelming that e-commerce is now the growth engine of South African retail,” he said during a presentation of the report on September 11.

The significant growth in online retail during 2024 was owing to more people across different demographics engaging in online shopping. For example, there was growth in the group aged 35 to 44 years old to 39.7% of those who engaged in online shopping in 2024, up from 35.2% in 2023.

A similar jump was observed in the group aged 45 to 64 years old to 34.2% who engaged in online shopping in 2024, up from 30.8% in 2023.

These individuals tend to be the best-earning group, as they are at the peaks of their careers and have the highest percentage of discretionary income. More of them are shopping more online and are making a big contribution to the growth of online retail, he said.

One of the report's most significant findings is that those in the top socioeconomic levels, or the wealthiest, regularly shop online, with 77.7% of respondents at this socioeconomic level shopping online during 2024, up from 63.4% in 2023, Goldstuck said.

Further, there was also growth in how much was spent online, with 23% of respondents in 2024 saying that they had spent R2 000 or more online over the prior six months, up from 14% in 2023.

Additionally, those consumers who had spent R 2000 or more over the prior month had almost doubled in 2024 to 8.5%, up from 4.3% who had spent that much or more during a month in 2023.

“These represent significant increases in the proportion of people spending money shopping online and provides yet another clue to the extent to which online shopping had rocketed in 2024.”

Income level was a strong indicator for why the country was seeing strong growth in online retail, with the top three groups by earnings all saw significant jumps in the proportion of people in these groups that shop online, rising to 36% of people earnings R40 000 to R50 000 in 2024 shopping online, up from 22% in 2023.

The biggest earners were also the biggest online shoppers, and this was helping to drive the growth in online retail, he noted.

Meanwhile, in terms of successful online retailing, Goldstuck highlighted that the “golden triangle” of success factors are good customer service, product availability and good quality products and/or services.

“Price is important, but, if the price is the same, then consumers will choose the most convenient option.”

“Online retail has reached a stage where maturity matters as much as momentum. South African retailers are no longer only testing e-commerce; they are scaling it profitably,” said payment services company Peach Payments CEO Rahul Jain.

The report shows that the ecosystem is ready for its next phase, which has been built on robust payments, efficient logistics, and growing consumer trust.

Further, the focus for the next few years will be on deepening consumer relationships.

“Convenience and speed brought consumers online during the pandemic, but loyalty will be built on experience, which means seamless checkout, predictable delivery and trust in every transaction.

“These are the areas where South African retailers are now investing, and it is why we believe the next wave of growth will be even more sustainable,” he said.

The report was produced in collaboration with payments services companies Mastercard and Peach Payments, and market research firm Ask Afrika.