African retail’s future hinges on tech-driven consumer insights
The retail industry in Africa is going through a pivotal decade. Africa's retail industry is expected to reach $3.7tn by 2031 due to macroeconomic expansion, a significant shift in consumer behavior, and the fastest-growing youth population in the world.
Blessed Hwaire, Industry Value Advisor for Consumer Products, Life Sciences, and Retail at SAP Africa. Image supplied
At the centre of this transformation is a young, mobile-first generation whose expectations are reshaping how retailers engage, sell, and build loyalty.
More than 119 million Gen Z consumers are coming of age as digitally fluent, aspirational shoppers.
Despite broader economic pressures, 70% expect their financial situation to improve in the near term.
As these consumers prioritise quality and global brand experiences, moving fluidly between online discovery and physical purchase, retailers will need to confront a structural shift: loyalty is no longer secured through price alone, but through relevance, convenience, and experience.
Africa’s ‘click-and-mortar’ retail model
Modern consumer journeys are inherently hybrid. Sixty-three percent (63%) of African consumers research products online before making a purchase, even when the final transaction happens in-store.
Social platforms such as WhatsApp, Instagram, and TikTok have evolved from marketing channels into primary drivers of purchase intent.
Physical retail remains central to trust and fulfilment, accounting for the majority of completed transactions and sustained loyalty.
The result is the rise of a distinctly African “click-and-mortar” model, where digital discovery and physical fulfilment are seamlessly interconnected.
Retailers that treat these as separate channels risk fragmentation, while those that integrate them into a unified experience are seeing measurable gains in engagement and conversion.
The most compelling evidence of omnichannel value creation on the continent comes from Shoprite Group's dual strategy: a physical supermarket network anchored by deep loyalty programme penetration, layered with Checkers Sixty60 as the digital-first quick commerce extension.
Sixty60 fulfilled over 100 million orders since its 2019 launch, with revenues growing 48% to R18.9bn in FY2025 and on-demand digital commerce sales rising a further 34.6% in the first half of FY2026.
Critically, Sixty60 is not a standalone digital channel but a loyalty-integrated experience: Xtra Savings Plus, South Africa's first grocery subscription, delivered unlimited free Sixty60 deliveries alongside additional in-store discounts and doubled the retailer's original subscriber target within its first year.
Core technologies underpin retail success
The retailers winning hearts and wallets are the ones that use technology as a decisive differentiator.
Unified commerce platforms that connect every touchpoint in the customer journey from social discovery and mobile browsing to in-store fulfilment and post-purchase engagement enable consistent, personalised experiences across channels, helping customers find products faster, access relevant offers, and choose payment options that suit their needs.
None of this would be possible without connected data.
Retailers sit on vast volumes of information across point-of-sale systems, loyalty programmes, mobile apps, and digital platforms.
When this data is unified and enriched with AI-driven insights, it becomes a powerful engine for engagement, enabling retailers to anticipate demand, personalise offers, and improve retention.
Retailers leveraging integrated data and AI capabilities are reporting reductions in customer churn of up to 30%, alongside improvements in stock availability, workforce productivity, and overall operational efficiency.
More importantly, they are building deeper, more durable relationships with customers by delivering experiences that feel relevant and timely.
Rich, personalised retail customer experiences
Consumers increasingly expect retailers to understand their preferences, anticipate their needs, and communicate with them in context. This goes beyond targeted promotions to include intelligent product recommendations, tailored loyalty rewards, and seamless interactions across digital and physical environments.
Loyalty itself is also being redefined. Traditional points-based programmes are evolving into broader loyalty ecosystems that integrate retail, payments, and financial services.
In South Africa, for example, leading retailers have demonstrated how loyalty platforms can drive both engagement and revenue, with millions of active users and billions in annual savings delivered to customers.
Retail customer experiences are also being enhanced through embedded finance, including Buy Now, Pay Later (BNPL) solutions, digital wallets, and integrated payment options. These services unlock purchasing power and reduce friction at the point of sale, reshaping how consumers shop and how retailers compete.
Yet for all the advances in digital engagement, Africa’s retail landscape remains uniquely complex. Informal trade continues to account for a majority of transactions in many markets, creating a hybrid ecosystem where formal and informal channels coexist.
Rather than competing directly, forward-looking retailers are finding ways to integrate with these networks, extending digital capabilities into local markets and building loyalty across both formal and informal touchpoints.
Ultimately, the future of retail customer engagement in Africa will be defined by integration: of channels, data, technology, and experience. Retailers that can unify these elements into a seamless, omnichannel journey will be best positioned to capture the loyalty of the continent’s next generation.
About the author
Blessed Hwaire, Industry Value Advisor for Consumer Products, Life Sciences, and Retail at SAP Africa