Jumia reports 22% gross profit increase in third quarter

Online retailer Jumia has reported a remarkable 22 percent increase in gross profit for the third quarter of the year, marking the first time its gross profit after fulfillment, sales, and advertising expenses turned positive at a group level. Jumia's Chairwoman for Nigeria and Head of Institutional Affairs, Juliet Anammah, attributed this success to strategic decisions taken from the last quarter of 2019. These decisions included exiting certain verticals and countries, rebalancing the product portfolio with a focus on categories that drive repeat purchases, and implementing financial discipline. The shift towards more cost-efficient practices and prioritizing consumer lifetime value also contributed to the positive results. Anammah emphasized the importance of aligning investments with consumer expectations and the sustainability of these strategic actions in driving future performance. Thanks to these efforts, Jumia was able to reduce its operating loss by almost 50 percent, reaching a three-year low in Q3. Anammah highlighted the significance of maintaining financial discipline in the current economic climate shaped by the COVID-19 pandemic. Jumia's adaptability to varying macro environments in African countries during the pandemic led to an increasing adoption of e-commerce by sellers and brands. Anammah underscored the importance of staying focused on consumer needs and offering products that customers value to sustain growth. The company's dedication to enhancing its digital services through initiatives like JumiaPay underscores its commitment to driving transaction volume and digital adoption on its platform. As the e-commerce landscape in Africa evolves, Jumia remains optimistic about the sector's growth beyond 2020. Anammah noted a shift in the perception of e-commerce in Africa and highlighted partnerships with governmental entities in countries like Morocco as indicators of the sector's potential. Despite potential macroeconomic challenges in the future, Jumia anticipates continued growth in the e-commerce market and the sustained interest in digital platforms post-pandemic.