Jumia, the e-commerce company, recorded a drop in its Sales & Advertising expense by 9% from €8.9 million in the first quarter of 2020 to €8.1 million in the first quarter of 2021.
This drove marketing efficiencies with Sales & Advertising expense per Order decreasing by 12%, from €1.4 per Order in the first quarter of 2020 to €1.2 in the first quarter of 2021. This was a result of continued programmatic marketing improvements with better targeted and more engaging campaigns across social media and search engines.
According to the report, Jumia’s gross profit increased by 11% to €20.4 million in the first quarter of 2021 from €18.4 million in the first quarter of 2020 as a result of the increase in Marketplace revenue. On a constant currency basis, Gross profit in the first quarter of 2021 increased by 21% year-over-year.
Further analysis by Brand Spur revealed that operating loss was €33.7 million in the first quarter of 2021 while Adjusted EBITDA loss was €27.0 million, decreasing by 23% and 24% on a year-over-year basis respectively, demonstrating meaningful progress on our path to profitability.
Marketing & Advertising revenue increased by 36% as a result of the robust take-up by advertisers, both Jumia sellers and third parties, of Jumia Advertising solutions as we continue to improve the relevance and user experience of our ad solutions.
General and Administrative Expense
General & Administrative expense, excluding SBC, reached €20.3 million, down 17% on a year-over-year basis. This decrease was attributable to staff costs savings as a result of the portfolio optimization and headcount rationalization initiatives launched in the first quarter of 2020, alongside a decrease in professional fees, including legal expenses.
At the end of March 31, 2021, Jumia had €485.6 million of cash on its balance sheet. This includes approximately €205 million of the total gross proceeds from the offering completed on March 30, 2021, with a remaining €88 million of cash booked in April 2021.
Total Payment Volume (TPV) increased by 21% from €35.5 million in the first quarter of 2020 to €42.9 million in the first quarter of 2021. On a constant currency basis, TPV increased by 35% year-over-year. On-platform penetration of JumiaPay as a percentage of GMV increased to 26.0% in the first quarter of 2021 from 18.7% in the first quarter of 2020.
JumiaPay Transactions increased by 7% from 2.3 million in the first quarter of 2020 to 2.4 million in the first quarter of 2021, with JumiaPay Transactions above €10, which include prepaid purchases on the Jumia physical goods marketplace and Jumia Food platforms, growing by 30% over the same period.
JumiaPay Transactions below €10 which mostly consist of transactions on the JumiaPay app, declined by 3% over this period. This trend was concentrated in the airtime recharge category as a result of reduced consumer incentives within this category which has historically been promotionally intensive.
Overall, 36.7% of Orders placed on the Jumia platform in the first quarter of 2021 were completed using JumiaPay, compared to 35.5% in the first quarter of 2020.