Building Trust in Ethiopia’s E-commerce: The Impact of Verified Sellers

By Dagmawi Demeke

In just a few decades, e-commerce has rapidly grown to dominate the business landscape and major economic headlines worldwide. In the Western world, this shift is so drastic that it has become immediately visible in traditional brick-and-mortar businesses, people’s shopping habits, and governments’ monitoring of money flows.

In comparison to other nations, Ethiopia’s e-commerce sector is still relatively new and underdeveloped, even when compared to neighboring countries such as Kenya. 

Reasons for the sector’s lagging behind can be attributed to delayed policy development, low internet penetration, and low online literacy. But, this hasn’t stopped several online marketplaces from emerging in recent years.

Currently, there is tremendous growth in the sector, making it an attractive market for both local and international prospective investors.

In the midst of this boom, Ethiopia is facing one of the biggest challenges in the growth of the e-commerce industry, a challenge that the Western world also faced in the early days, which is the lack of trust and accountability that plagues online commerce.

Most e-commerce platforms currently operating in Ethiopia usually only require a phone number and email to create an account and start selling on their platform.

These online marketplaces do not take measures to reduce the concerns and lack of trust that come with online shopping, and they do not take action to prevent products from being faulty, not as described, or sellers from being untrustworthy.

The platforms do not require this mainly due to the fact that most of the leading platforms are general marketplaces meant to facilitate exchange between buyers and sellers of any type and as such sellers are only required to create a personal account.

One platform that operates in this way but takes extra measures to increase the trust and quality of products shared on its platform is Jiji Ethiopia. The platform recommends a price and notifies sellers if they’re overcharging or undercharging. Products also go through a moderation period before approval. However, this is just a temporary solution to a larger problem.

The bulletproof way to increase trust and facilitate seamless online transactions is through platforms that feature verified and trusted sellers. Verified sellers are those who have completed the necessary information required by an online marketplace to create their own online store on the platform.

Platforms such as Ashewa.com, designed specifically for verified and trusted sellers, and Shega Gebeya, an e-commerce platform that connects businesses and customers online, have been able to achieve this

In the case of Ashewa, the ecommerce platform allows both verified and unverified sellers to sell on the platform.  Vendors can create their own digital storefronts for free, but they are required to provide the necessary documents to get the platform’s approval.

Verified sellers who have provided their business license, TIN number, store name (official or unofficial), and paid for the value-added subscription plan are distinguished by a badge that differentiates them from sellers who have not provided the required information or upgraded to one of the platform’s three subscription plans.

Currently, all the essential information is being authenticated manually, as there is no system in place for third parties such as the Ministry of Trade and Industry and the Ethiopian Revenues and Customs Authority to access the database and verify the authenticity of a vendor’s business license and TIN number.

So what are some of the benefits verified (trusted) sellers would bring to the current ecommerce industry?

1.  Increased credibility 

There is a lot that can go wrong while people are trying to make online purchases. Thus, trust is a critical factor for the success of online commerce, especially in a country like Ethiopia where there is a strong retail shopping culture.

Building a trustworthy platform can attract customers and increase the adoption of e-commerce. Having trusted sellers on online marketplaces provides customers with more assurance that they will receive a product of the highest quality at an agreed-upon price. Much of what discourages people from making high-value purchases is the risk of being scammed, whether it be the product being not genuine or the price being different than advertised.

  2. Improved customer experience

Customers who know that they are dealing with a trusted seller are more likely to have a better shopping experience because they can rely on the vendor for accurate product information and the platform for a transparent return policy and timely delivery. Knowing that a vendor is accountable for delivering what is promised allows customers greater confidence when making purchases.

Additionally, having a transparent return policy and timely delivery provides convenience and assurance that returns or exchanges can be made with ease. As a result, customers are more likely to remain loyal and make repeat purchases from the same seller in the future.

  3. Increased sales potential

Building trust with customers is essential in driving more sales in any marketplace, especially in an online marketplace where customers need reassurance that they can trust the sellers they are using. This removes any doubt and adds peace of mind.

To capitalize on these advantages, an online marketplace should convey a trustworthy and reputable image to shoppers. This includes having clear return policies, offering convenience for customers through effective payment platforms, fulfillment, and customer service. By focusing on these factors, a platform’s competitive edge will be increased, resulting in an increase in sales for their business.

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Dagmawi Demeke is a digital marketing manager, SEO strategist, and freelance writer serving both local and international businesses in various sectors. Dagmawi can be reached at Dagimdemeke15@gmail.com.