Morocco’s e-commerce boom has outlasted its lockdown

One of Africa’s longest and strictest covid-19 lockdowns saw Moroccans move most commerce online.
One of Africa’s longest and strictest covid-19 lockdowns saw Moroccans move most commerce online.
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The covid-19 pandemic led to an e-commerce boom in many African countries, but its growth in Morocco has been particularly impressive. With a four month lockdown in 2020—one of the strictest and longest on the continent—Moroccans had to rely on the internet to purchase almost everything from food, clothing to electronics.

By the end of 2020, more than 1,000 e-commerce websites were operating in the country, with 300 of those having started business in the same year. In 2020, e-commerce sites in Morocco saw a 46% increase in transaction volume and 25% increase in amount of money spent compared to the same period in 2019, according to figures from Interbank electronic banking center (CMI), which monitors online transactions in the country.

“It was an eye-opening experience to all in the country. Internet users used to go online for fun – to watch videos, chat, play games, read local, and international news, but during the lockdown, it turned into serious business…because it was about the only option available to do shopping and that led to a boom in the industry,” says Rachid Lahbabi, researcher at the Faculty of Legal, Economic and Social Sciences of Ibn Zohr University in Agadir, southwestern Morocco.

Morocco’s e-commerce story

E-commerce is not new in the country, as legal regulations for the industry have been in place since 2005, but it was during the covid-19 pandemic that online commercial activities took off following the lockdown that forced a shift away from physical stores.

When covid-19 restrictions were eased many observers expected enthusiasm for online business to wane away but it did not, rather it grew stronger.

Spurred on by the pandemic, Morocco’s e-commerce growth is not slowing down anytime soon. 2021’s figures show an increase of at least 48% in number of transactions, and 30% in amount from 2020.

“What happened during that period established trust between e-commerce operators and the population. Before that time, a lot of people used to think doing business online is too risky and not advisable. However, that belief is eroding as users are carrying out successful transactions online everyday,” says Fatiha Idhammou, a consultant at e-commerce agency, Energiedin.

“Secondly, it changed customer behavior. The ease of ordering an item from the comfort of your home and waiting for it to arrive is kind of winning over traveling to physical stores for shopping. And also, e-commerce offers competitive prices from different brands and service providers and that is what locals are beginning to understand.”

Fast internet and a good road network has facilitated Morocco’s e-commerce growth

Online businesses in Morocco are not limited to e-commerce giants like Jumia, Shein.com or Electroplanet.ma, which operate virtual marketplaces. Sellers and buyers also meet elsewhere and do business in the form of social commerce, which involves advertising, selling, and buying on social media.

“There are many sellers, probably more than a thousand that operate quietly on social media. They showcase their products to their followers and subscribers, friends or groups, on Facebook, Instagram, WhatsApp, process orders, and carry out deliveries. They mostly operate Cash on Delivery, which cannot be tracked by the authorities,” Lahbabi says.

The popularity of the internet and smartphones largely contributed to the growth and development of online commerce in Morocco, experts say.

The share of internet users in the country currently stands at 75% of the country’s population of 37 million people, with 89.6% of users connecting from a mobile device, according to the Digital 2021 report published by We Are Social and Hootsuite.

“E-commerce is online and so the absence of good internet would have harmed the industry. Another factor that has favored the e-commerce here is logistics,” says Driss El Alami of DM Telecom based in Rabat.

Morocco is the fifth African country on the global ranking of quality road networks, with a score of 4.7, only behind Namibia, Egypt, Mauritius, and Rwanda, according to the Global Economy.

“Good roads facilitate the distribution of goods, faster and to everywhere. When all places are accessible by road networks then e-commerce will flourish because they can get their products to buyers even in the villages and that is the situation here in the Kingdom,” says Alami.

However, not all online merchants in Morocco are able to cover the entire territory due to lack of transportation means or the absence of partnership with viable distributors. Only Jumia covers up to 94% of the country, according to Jumia’s Morocco CEO, Larbi Alaoui Belrhiti.

“Logistics is a huge part of e-commerce. We knew that right from the beginning and so we invested heavily in distribution channels. Our most successful channel is the pick-up stations. We install a mini warehouse everywhere and allow buyers to pick their products from there without traveling far away,” Belrhiti told Quartz.

Challenges of e-commerce in Morocco

Commerce in Morocco employs nearly 2 million people, which is about 14% of the active population and contributes 8% to the national GDP, according to businessfrance.

E-commerce accounts for just 2% of the retail sector in the country and is still a long way off from killing brick and mortar businesses.

A weak ecosystem of many e-commerce start-ups, the absence of international investors, the huge size of the retail market and the sluggishness of local companies to catch up with the trend are some of the barriers to be lifted in order for the industry to reach its full potential, according to one expert.

“More investment is needed not only by selling platforms but also in payment solutions and logistics as well as awareness to help establish a relationship of trust between the platforms and the end consumer. If we get to that stage, more customers would be turning their back on physical stores in favor of online shopping,” says Ahmed Hicham, economist at Chouaib Doukkali University in El Jadida.

Regionally, Morocco remains a minor player in online retail business, occupying 7th position, with South Africa, Egypt, Nigeria, Algeria, and Kenya together accounting for 78% of total e-commerce traffic in Africa, according to a report from the International Trade Centre (ICT).

Hicham says though that Morocco’s proximity to the west and hence the ability to access high quality goods at a lower rate, plus the country’s strong logistics networks and stable power supply, put it ahead of its regional peers.

“Morocco remains a fertile ground for this business but it would take some time for online shopping to become mainstream because the culture is yet to fully gain traction.”

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