Technology is changing the delivery and courier industry

Introduction

Technology has completely reshaped the way online businesses operate in South Africa. Over the past few years, more companies have started adopting digital tools and systems to make online shopping faster, safer, and more efficient. My research looks into the different types of technology used in online sales, such as ERP systems, social media marketing algorithms, payment safety protocols, and real-time tracking of products. The goal of this research is to understand how all of these systems work together to help South African businesses improve their online presence, customer experience and satisfaction, as well as their overall performance.

Physical vs Online Sales

Source: Shopify — “Retail vs. Ecommerce: How Are They Different?”

Physical sales, often referred to as “brick and mortar” sales, rely on customers visiting a physical store. In contrast, online sales take place through websites or apps, allowing customers to buy products from anywhere if they have internet access Some main differences include:

• Presence: Physical stores need a location, while online stores can operate anywhere.
• Payments: Physical stores use both cash and cards, whereas online stores only use digital payments.
• Distribution: Online stores deliver products straight to the customer, cutting down on supply chain costs.
• Customer Experience: Online shopping requires good website design and navigation to make the user’s journey enjoyable.
• And a fifth one

Using social media algorithms for advertising

Source: West Virginia University — “The Impact of Social Media Algorithms on Marketing”

Social media has become one of the most powerful tools for businesses to advertise online. Platforms like Instagram, Facebook, and TikTok use algorithms to recommend posts and ads based on what users have interacted with most. For example, consistently liking, commenting on, and sharing videos about the latest Star Wars movie will cause your algorithm to adjust. You’ll start seeing more Star Wars-related content popping up across your social media platforms, such as advertisements for Lego sets that take inspiration from the movies, videos of influencers and creators giving their hot takes on the franchise, or even discount codes to buy your own lightsaber. Businesses can use this to their advantage by:

• Using hashtags: Making use of keywords can attract clients who have interacted with other social media posts related to that topic.
• Promoting interactions: Using phrases like “don’t forget to like and subscribe!” or “tell me what you guys think in the comments!” encourages users to interact with the content you’ve created and boosts the ranking, which tells the algorithm to suggest it to other audiences
• Using short form content formats: With the rapid increase of short form videos (like Instagram reels and TikToks), people's attention spans have drastically decreased. Having shorter, more captivating content will get more recognition.

Protecting personal information online

Source: Zendesk — “Customer Data Protection: 10 Tips to Keep Information Safe”

Security is one of the most important parts of online sales; customers need to know that their personal information (such as card details, ID numbers, and addresses) is safe when shopping online. South African e-commerce companies follow strict cybersecurity measures, including:

• Encryption: Protects data so only authorised users can access it.
• Two-Factor Authentication: Adds an extra layer of login verification.
• 3D Secure (3DS): Uses biometric verification for card payments.
• POPIA: South Africa’s law that protects personal data from being misused.

ERP systems and inventory management

Source: Shopify — “5 Essential Inventory Management Tools for Retail”

To simply explain what an ERP (enterprise resource planning) system is, imagine you were given the task of making dinner. You need to think of what to make, find a recipe, create a grocery list, shop for the ingredients, do the cooking, and then only will you have completed the task of making dinner. An ERP system can take a recipe (service plan), check inventory stock and create a shopping list, store valuable information, and manage all the cooking (production) logistics. These systems are the most common form of technology used in larger businesses to accurately keep track of inventory, without spending additional costs on extra employees or human error. ERP include various functions such as:

• Financial decisions
• Approving purchase orders with suppliers
• Supply chain management
• Distribution logistics
• Real-time tracking aspects
• Helping businesses determine profitability

Warehouse automation and robotics

Source: AiTen — “What Robots Are Used in Warehouses?”

With the boom of online shopping and e-commerce in recent years, companies have had to think of innovative ways to efficiently locate and pack orders for customers. So, the fastest and safest way to do this was to incorporate robots. These robots do the more dangerous and physically demanding tasks to save time, while the skilled workers are saved for more complex roles. There are still human workers there to create a collaborative environment between man and machine. These robots can be programmed in a way that allows them to refer to the company's ERP systems to accurately locate and pack orders.

The most common types of warehouse robots include:

Real-time tracking and GPS technology Source: Peaktech — “Real-Time Location Systems (RTLS) in Supply Chain Management” Real-Time Location Systems (RTLS) work together with ERP systems to show customers exactly where their packages are.

How it works:

• Identification:
  Each product has a barcode or RFID tag.
• Tracking:
  GPS or GLONASS records the product’s position.
• Upload:
  Information is sent to the ERP system for live updates.

Customers can then track their parcels on a map through the company’s app or website.

High data costs in South Africa

Source: MyBroadband — “Pick n Pay Mobile Launches Major Upgrades”

The digital economy, by definition, requires a digital interface. For you to participate in this economy, you need to be connected via data. In South Africa specifically, there is a huge digital divide, which has made access to the internet a growing problem. The cost of data becomes a barrier to clients wanting to shop online. The value chain is choked by network operators and internet service providers charging a premium for a service that, in this day and age, is a human right.

Some creative solutions that retailers have come up with are:

• Making their sites zero-rated (so they don’t use data).
• Offering data rewards, like Pick n Pay’s “1MB of data for every R1 spent.”
• Partnering with banks and ISPs to reduce fees and improve access.

Loyalty and cashback programs

Source: Yahoo Finance — “South Africa Cashback Programs Market Opportunities Databook 2024”

Loyalty can be built through a structured cycle of awareness, action, reward, and reinvestment. Loyalty programs follow this model to motivate clients to engage in behaviours that earn them rewards. When clients act and are rewarded, they form an emotional connection that encourages repeat behaviour. These programs often use social media, direct marketing, and mainstream media to promote their benefits. Clients who value these rewards are motivated to take action, especially when rewards are relevant, timely, and localised. In most cases, these actions align with a commercial goal.

Examples include:

• Stamp card: Buy 5 coffees, get the 6th free—encouraging repeat purchases.
• Cash back: Spend money and receive a portion back, creating a sense of saving and reward.
• Streak: Use a program daily for a set period to earn a bonus, fostering habit-forming engagement. Loyalty programs may also offer discounts on partner products and services through online platforms or apps.