E-commerce giant Amazon seems to be 'testing the waters' in South Africa

Customers in Africa's biggest economy can now enjoy a new online shopping experience, as Amazon launches its online retail operations in South Africa – the first in sub-Saharan Africa.

Amazon announced the launch of Amazon.co.za, providing customers in South Africa with a selection of local and international brands across 20 different product categories, and sending ripples through the e-commerce landscape. However, the splash was smaller than expected.

While South Africans anticipated the usual Amazon fanfare of deals and its own branded products, the launch was subdued, lacking the familiar Amazon bells and whistles.

Consumers were offered incentives like competitive pricing, free delivery vouchers, access to 3,000 pickup points and daily deals, but there were no listings for Amazon core products including the Kindle e-readers, Fire TVs, Ring doorbells, or Alexa smart speakers.

Disappointingly, none of Amazon's digital services like Amazon Music or the highly anticipated Prime subscription (bundling e-commerce and digital services) were available either. The only exception was Amazon Prime Video, which had already launched in South Africa years ago.

Reports have noted that while Amazon's South African offering seemed to mirror South Africa's largest e-commerce platform Takealot, with a similar layout and features, Amazon seemed to be lagging in terms of product availability including Amazon's own products which were readily available on competitor Takealot's website. Many listings, including popular smartphones, were labelled out of stock.

The one advantage Amazon offered was free delivery on the first order, followed by free delivery for subsequent orders above R500 (about $27). Albeit, the free delivery only applies to standard delivery option and items directly shipped by Amazon, not third-party sellers.

This muted entrance raises intriguing questions about Amazon's strategy in the local market. The move suggests a measured approach by Amazon, possibly gauging market response before committing fully. This could indicate a long-term play, with Prime's introduction a strategic move for later, so it may not takealot of time before the rivalry begins.

But despite this muted entrance, delaying an immediate price war with existing e-commerce platforms like Takealot, Bob Shop, Makro, Bidorbuy and Zando, Amazon's competitive pricing and free delivery vouchers might just be enough to challenge the established players.

Ultimately, the biggest winner would be the South African consumer. Consumers can expect a wider selection of products and aggressive discounting as both giants vie for market share.