In September 2012, President Goodluck Jonathan inaugurated the Presidential Committee for a national broadband strategy and roadmap as it has been empirically proven that every 10 per cent increase in broadband penetration in developing countries results in a proportionate increase of 1.3 per cent in GDP.
“Currently, we are in ten markets in Africa, Nigeria was our first market, and it’s our number one market at the moment,” James Gibson, Managing Director HelloFood told CNBC Africa.
The broadband penetration plan is for the period 2013 to 2018 and aims to increase broadband penetration by five times by the end of 2017. With the launch of HelloFood, a subsidiary of Foodpanda, in Nigeria two years ago the country’s online space was once again stretched further.
“We started off in Lagos and it remains our key base. We then expanded to Abuja and just two weeks ago, we launched in Port Harcourt,” he added.
Lagos is currently the most populous city in Nigeria and is the second fastest growing city on the African continent. This, coupled with the continuous increase in the country’s middle class, makes it the ideal place for the e-commerce businesses to thrive.
“Restaurants had been doing deliveries in the past but previous methods would have been to call up a restaurant. However, one of the challenges of doing that especially here in Nigeria, is the networks aren’t always that reliable,” he explained.
According to statistics from the Nigerian Communications Commission, in 2013 a total of 48.3 million Nigerian telephone subscribers actively browsed the internet on their mobile phones.
“What we have come into the market to do, is to make it so much more convenient to place an order. You no longer have to call up a restaurant, all you need to do is, get onto your app on your phone, a few taps and then you’ve placed your order,” he said.
Gibson believes that, although the space is globally quite competitive, there are mainly three players in Africa and HelloFood is currently the number one with plans to expand into another five countries on the continent.
“The space is huge, there is so much potential. Of course with a product like food, people need food every day, actually, they need it three times a day,” he added.