MIH Internet Africa (MIHIA), a subsidiary of the listed Naspers group, is set to restructure its operations to focus specifically on its general e-tail businesses such as Kalahari, which it plans to grow aggressively over the next year.
Kalahari had a strong festive season, with sales up around 40% year-on-year, and has just introduced an advanced platform.
The restructuring will allow the group to dedicate more resources to this "exciting" area of growth, building out stronger platforms and offering better services, says Naspers.
Some small businesses which are no longer core, namely Style36, 5Rooms, Kinderelo, SA Camera and 5Ounces, will be closed down, after consultation with staff and reviewing all options, it says.
"This decision is based purely on a shift in strategy and was not performance-related. This process is limited to the MIHIA group and does not affect other Naspers subsidiaries with e-commerce investments in Africa, such as Media24 which continues to focus on fashion e-commerce."
Outgoing CEO Koos Bekker recently said Naspers is likely to invest less in e-commerce going forward and focus on managing what the company has. It is streamlining its assets into Amazon-type services, such as Kalahari, and classifieds, he explains.
Bekker says the second large focus for e-commerce is in classifieds, such as its OLX offering, which it has wholly-owned since 2011. He adds that, for Naspers' next venture, the group will look in ICT, which is where its skills lie, and seek something in which it has skills, or can learn.
E-commerce is Naspers' third-largest ICT unit after its Internet operations and pay-television. In the six months to September, it almost doubled revenue to R7.9 billion, although it reported a R1.8 billion trading loss. Its classifieds business saw a twofold increase in page views, and its e-tailing segment improved its top line, it noted.
Naspers adds Media24 will continue to leverage its magazine titles to drive e-commerce activity, especially through fast-growing fashion vertical Spree, and is planning to expand substantially in this area.
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