Running an e-commerce venture demands different skills as compared to conventional business models, and many businesses in the Pacific have struggled to take advantage of the opportunities that e-commerce can offer. Nevertheless, the informal e-commerce sector is thriving. In most Pacific countries, popular forums on social media have thousands of members. For example, the Facebook page “Buy and Sell in Suva” has over hundred thousand active members.

These forums have the potential to be a proving ground for future Pacific e-commerce start-ups, allowing aspiring entrepreneurs to develop the needed commercial, digital and financial skills to launch business ventures. Some have already made the transition to becoming formal e-commerce companies, and they are demonstrating the positive impact that a dynamic e-commerce sector can have on Pacific economies and consumers.

Another example is Cheap Games Fiji (CGF), a company with humble beginnings, but is today one of the largest retailers of video games and gaming equipment in Fiji. The business started in 2015 when founders Rakin Wahed and Rajeev Naidu, both keen gamers, were scouring the second-hand market for a used copy of a PS4 game called “Watchdogs”. They found a seller, bought the game and completed it within a couple of weeks. They then decided to resell it on popular Facebook group, ‘Buy-and-Sell in Suva’. The game sold within hours and “for a significant profit.” With the proceeds, they bought two other used games, both of which potentially had a higher market value. They repeated the cycle of finishing the game and re-selling on Facebook, and thus the seeds for a new business were planted.

The partners discovered that games were significantly cheaper outside of the Pacific and tried to establish a proper supply chain. This, too, had informal beginnings: friends and relatives traveling back to Fiji were instructed to load up on second hand games before taking the flight.

The demand for the latest releases was also high and relatives from abroad continued to purchase the games for them. After adding their own mark-up, CGF could still beat the local competition by a good margin. As they started mastering the art of social media advertising, particularly on Facebook, and search engine optimisation, visits to their page grew exponentially.

The pressure to diversify led to a dilemma: Facebook did not offer the functionality to separate their products into categories. Hence, new and used games and gaming accessories were all mixed up and it was difficult for clients to navigate the page. The time had come to register a formal business and set up a fully-fledged e-commerce website using a service called Wix. The founders opened a bank account and a corporate mobile money account with Vodafone’s M-Paisa to receive digital payments, but continued to accept cash on delivery due to customer demand. Setting up a website seemed like a risky step, but it paid off. Within weeks, according to Wahed and Naidu, they were being contacted by gaming wholesalers from across the world. With a streamlined online-only business model, access to global suppliers and a sound advertising strategy, CGF was ready to take the Fijian market by storm.

The results were quite dramatic, Naidu and Wahed said: within a few months one of their main competitors, an established high street retailer, had decided to give up on video games. Their other competitor persevered, but with a significantly reduced market share. The impact on the market, according to the owners, has been remarkable: the number of available games has increased; the prices of new games have dropped; and the dynamic secondary market offers a proven way of recouping part of the investment. The result is that the total number of gamers in Fiji has increased noticeably and most now have the means to access far more titles than they did before.

CGF’s clientele is made up predominantly of young, middle income Fijians with above average levels of digital and financial literacy, consistent with typical early adopters of digital channels worldwide. However, the company’s growth illustrates the potential of e-commerce in Pacific markets in reducing prices, stimulating market competition and expanding access

Video games are not essential products, and are unlikely to improve the lives of many low-income Pacific Islanders. Nevertheless, the success of CGF provides a template for other potential e-commerce entrepreneurs working in a range of sectors, including those that can impact the lives of low income and remote communities.