Kenyan retailers might not have fully adopted mobile communications to fuel their business activity, but they are embracing it, and technology is on the rise when it comes to their marketing campaigns. A recent Nielson study conducted on Kenyan retailers and their use of technology reveals that mobile usage in the past has been significant. Moreover, companies are slowly turning to mobile marketing concepts.
The Neilson research group conducted face-to-face interviews with 300 retailers across many spectrums and service channels throughout Kenya. The results show that, right now, most retail business is done in the country through direct communication and transactions. In fact, 96 percent of consumers in Kenya prefer to pay retailers with cash, and 88 percent of them prefer in-person communication. They also like to see new products firsthand.
The Promise of the Mobile Market
Even though retail businesses in Kenya today seem to under-utilize mobile technology—just 12 percent of customers use mobile money to pay for goods—Nielson East Africa MD Jacqueline Nyanjom, says, “In a country with 96 percent mobile penetration, the findings are somewhat surprising – but they do point to enormous potential for growth.”
Kenya’s mobile money market is perfect for growth because of how easy it is for people already utilizing mobile technology to make the jump to purchasing goods online. In other parts of the world, mobile money has already been embraced or made great strides. In Kenya, Safaricom’s M-Pesa currently dominates the mobile money market, as small as it is. M-Pesa launched in 2007 and has more than 25-million subscribers, and about 130,000 retail agents use the technology. Countrywide, 43 percent of the Gross National Product flowed through this channel in 2013.
The Future of Mobile Shopping
One of the main reasons that Kenyans rely on cash for purchases is that it doesn’t carry transaction fees. Some shoppers and retailers, however, have expressed concern about the safety of using cash for purchases. Aside from fees, there are few reasons not to convert to the use of mobile money in the retail sector. About 25 percent of retail businesses say that they have not been approached with an offer to use mobile money for purchases, a fact that implies that there is an untapped group of business owners in this market.
Additionally, it seems that the time is ripe to encourage both businesses and consumers to accept mobile advertising and marketing as part of the mix. Companies need to focus on adopting retail apps, mobile coupons, promotions, geo-location deals and ads, and other mobile marketing tools in order to bring exciting new growth to the industry.