Latest news with #JonathanSpencer
Daily Maverick
2 days ago
- Business
- Daily Maverick
Gen Z's digital takeover of SA's payments industry
A wallet filled with cash and loyalty cards feels about as relevant as a phone booth for Gen Z shoppers. They're swapping physical payments for smartphones, buy-now-pay-later options, and loyalty apps. Gen Z has a low tolerance for obstacles. The moment a checkout process starts to drag– a form to fill, a password to remember – their patience runs out and their shopping cart is abandoned. According to the Online Retail in South Africa Report for 2024, online shopping is most prevalent among 25 to 34-year olds, closely followed by the 15 to 24 age group. Future trends of payment offerings seem to be dictated by the younger generation, and by 2030, they will be the greatest spending force across sub-Saharan Africa. Goodbye wallet The leather wallet your dad carries and your mom's heavy handbag filled with loyalty cards are quickly becoming artefacts of a different era. 'Today, everything's on your phone, your cards are on your phone,' Jonathan Spencer, brand head at OneDayOnly, said. 'All of your buy-now-pay-later options are also on your phone. You can check everything on your banking apps on your phone.' OneDayOnly, the South African daily deal site, has lived through this shift first-hand. Launched in 2010, the platform made its name by offering discounts on a number of different products each day. Spencer said that the way the site has kept up with evolving payment technology – by adding methods, removing friction and keeping data secure – keeps younger shoppers clicking. South African Reserve Bank data shows that digital payments (such as mobile wallets, tap-and-go and QR codes) are used by 53% of the youth in the country. Checkers has also kept its digital payment ecosystem a step ahead. When ordering online through the Sixty60 app, users are redirected directly to their banking apps for verification. 'Today's retail environment is defined by increasingly diverse customer needs and preferences. Convenience, flexibility and accessibility are central to what customers expect,' the retailer said. Breaking big payments into bite-sized chunks Many young customers also prefer using buy-now-pay-later (BNPL) payment options as it offers a budget-friendly option for a generation who are keeping a tighter grip on their purse strings. Gen Zs are more cognisant of the fact that credit comes with a lot of interest, Spencer said, adding OneDayOnly's BNPL option, Payflex, has grown a lot over the past year, along with instant EFT platforms such as Ozow, one of the retail site's biggest partners. In South Africa, BNPL is projected to become a $1.3-billion (R23-million) industry by 2030, growing roughly 13.6% annually. On Takealot's platform, the BNPL model is experiencing 'significant growth' among young consumers using Payflex, particularly in the 23–29 age demographic, the online retailer said. Its revolving credit service lets shoppers pay in instalments and earn 1% back on purchases, which offers a flexible solution for those with irregular income or limited savings. Providing options at a cost Adding more payment methods come at a price which merchants need to absorb. Spencer said that transaction fees associated with these platforms are a convenience charge but can become costly. 'The general public don't really understand that when we take on these payment partners, there's a fee per transaction that's involved in it for us as a company and those fees vary per partner,' he said. The future is (still) mobile-first In future, payments will become even more flexible. 'I think we'll start seeing some sort of cryptocurrency coming in,' Spencer said. 'That's something people are starting to think about and how we would start working that into our business and start taking it as payment.' South African retailers such as Takealot and Pick n Pay already accept crypto payments and according to the South African Revenue Service, more than 5.8 million South Africans hold a crypto asset. Loyalty programmes, such as banking rewards and student discounts, remain a powerful way to attract and retain young shoppers. An example is Varsity Vibe, a discount app that can be used only by students and offers special promotions and discounts when shopping at stores such as H&M. Takealot's loyalty service, TakealotMORE, plays directly into this preference. With plans starting at R39 a month, members can get free delivery across Takealot, Mr D, Takealot and in-store Pick n Pay orders. The online retailer said young shoppers appreciate services that integrate smoothly into their lifestyle. Quick and convenient Gen Zs expect their smartphones to do it all: carry their payments and loyalty points without needless complexity. To better serve a younger demographic, Takealot advocates integrating shopping directly into social media platforms, where young people already spend so much of their time, and adding user review and content from their peers to aid purchasing decisions. 'We know that the world is leading mobile first,' Spencer said. 'Businesses need to start thinking through that lens: How can I get this quickly and conveniently through my phone?' DM
Zawya
29-04-2025
- Business
- Zawya
South Africa's the starter home economy: Why first-time buyers are choosing smarter over spacious?
With interest rates softening, salaries improving, and the transfer-duty exemption threshold rising by 10% (saving buyers up to R3,300), South Africa's first-time buyers are making confident moves onto the property ladder. In fact, nearly half (46%) of all home-loan applications now come from this category, many of whom are opting for starter homes, which allow them to take that first step without incurring excessive debt. The financial appeal of going small According to Jonathan Spencer of starter homes - typically one- or two-bedroom properties ranging from 70m² to 116m² - offer a more accessible entry point into the housing market. 'They require a lower upfront investment, are cost-effective to maintain, and meet essential lifestyle needs. As property values tend to appreciate over time, these homes also enable buyers to build equity and eventually leverage the proceeds from resale to step up to a larger property.' He adds that beyond the lower purchase price, starter homes come with additional savings, from reduced utility bills and insurance premiums to more manageable property taxes and rates. 'This frees up budget for the fun stuff - décor, upgrades, and lifestyle items that personalise the space and make it feel like home.' Making small spaces work Whether buyers plan to live in their starter home or rent it out in future, thoughtful choices can go a long way. Spencer shares a few practical interior-design tips tailored to compact homes: Start with the essentials: Invest in quality basics like a comfortable bed and couch before focusing on trendy extras. Choose multi-functional pieces: Opt for furniture that serves more than one purpose—ottomans with storage, fold-out dining tables that double as desks, and bookshelves that can act as room dividers. Enhance the sense of space: Use light colours, mirrors, and natural light to make rooms feel larger and more open. Make every metre count: Create flexible zones, like a bedroom-office hybrid or a kitchen-dining nook. When it comes to vertical space, wall-mounted lighting, shelving, and décor elements help reduce clutter and free up floor area. A smart stepping stone While purchasing a larger property and furnishing it gradually may seem like the more practical choice, Spencer notes that rising living costs have made this option increasingly out of reach for many. 'Even if it means investing in items that might not suit a future, larger home, a smaller home can offer greater financial flexibility in the short term. Ultimately, the decision hinges on the buyer's current financial circumstances and long-term property goals.' Importantly, starter homes are no longer viewed as a temporary compromise. 'They've become a symbol of smart investment and modern living,' he explains. 'With more buyers prioritising affordability over square meterage, the 'starter home economy' reflects a new generation of property owners who value smart use of space. 'Starter homes prove that small spaces can deliver big returns,' Spencer concludes. 'It's a win for first-time buyers and a trend we expect will continue as South Africans reimagine what homeownership can look like.'
