Why African businesses should have an online strategy

An interesting piece was done by White African on interactive marketing in Africa. This came about after a conversation he had with both Rob Stokes of Quirk Marketing and I. Since then I have been working at developing a blog conversation covering our experiences in Africa. Our aim is to get African corporations to start engaging their potential online audience through better knowledge of the opportunities that exist.

Granted, only 5.6% of the African continent is online. Africa is the second fastest growing market in terms of connectivity at 1,100%. When most African corporations think of the web, they don’t see the potential markets this space holds for them. There are two very important aspects of online marketing that I point out to any potential customer looking at the reach an online market:

  1. The web allows a company to reach Africans in the Diaspora effectively
  2. Within Africa, the greatest concentration of online traffic is based on specific cities within a country and amongst the middle and upper class

Diaspora Africans
I once talked to an entrepreneur who wanted to reach Africans in the Diaspora. I told her that the biggest connection an African has with the continent whenever they are living in Europe, the Americas, the Middle East, Asia or Oceania is online. This is the ready access we all have when we think of Africa. We can read the news, find out which broadcasters have new content, connect with family and friends and keep abreast with conversation regarding Africa or our specific countries.

The Diaspora is a ready market for any product that can be sold or delivered online. Key hurdles often times are based on logistics or payment systems. Most African companies are either restricted within their corporate processes or international procedures and laws that place hurdles in their way of quickly utilizing available opportunities.

As is the case with most business models, success online depends on having the right strategy, knowing where and how to get your audience and figuring out a way to efficiently deliver on your brand promise. The web provides most corporations with an impressive reach into new markets either locally or globally. Africans in the Diaspora are already used to online shopping and have proven to be a constant source of remittances to their respective countries. Companies that utilize the opportunities a Diaspora market offers will be in a good position to reap great benefits.

An Urban Online Audience in Africa
So far, the web is an extremely urban affair within Africa. For instance, In Kenya 80% an internet study by the Communications Commission of Kenya (CCK) in 2006 found that the capital city Nairobi had 80% of all internet customers followed by Coast province with 9%. Kenya has 3 million internet subscribers as of 2008.

Kenya Internet Subscribers by Province

Kenya Internet Subscribers by Province

Source: CCK (Internet Market Study)

Nairobi Province’s population is estimated at around 3 million unique machines by Wikipedia. 80% of 3 million internet subscribers equal 2.4 million people*.

This is an extremely high reach for any company looking to sell its products within the urban areas of Nairobi and Mombasa which is within the Coast Province. When a company looks at its marketing targets and the audience they seek to reach, online marketing provides the right reach for them within key specific sectors. While the web is not the right platform for marketing to a rural or lower class audience, it is very effective in selling goods and services to middle and upper classes within any African country.

*The last study done by CCK was in 2006 when Kenya had around 1 million internet subscribers. The number of internet penetration within other parts of Kenya has grown but Nairobi still accounts for the lion’s share.

12 Comments

  • Wow! 80% is really big…would like to get more info on other African countries, any suggestions?

    Thanks.

    Posted by kainvestor | June 8, 2009 9:48 am
  • Wow! 80% is really big…would like to get more info on other African countries, any suggestions?

    Thanks.

    Posted by kainvestor | June 8, 2009 9:48 am
  • Excellent piece. It is very true that the web is a most invaluable tool at reaching high concentrations of Africa’s urban populations. One of the underlying themes to this piece that I find interesting is how quickly this is taking place.

    It is happening so rapidly that Africa’s large brands have not been able to keep pace and hence even with the growth relative to the potential the digital ad spend in Africa is still much smaller than it should be-today.

    This is a dilemma that will, in my opinion, self correct over time. Would anyone agree?

    Posted by Benin | June 9, 2009 5:29 pm
  • Excellent piece. It is very true that the web is a most invaluable tool at reaching high concentrations of Africa’s urban populations. One of the underlying themes to this piece that I find interesting is how quickly this is taking place.

    It is happening so rapidly that Africa’s large brands have not been able to keep pace and hence even with the growth relative to the potential the digital ad spend in Africa is still much smaller than it should be-today.

    This is a dilemma that will, in my opinion, self correct over time. Would anyone agree?

    Posted by Benin | June 9, 2009 5:29 pm
  • Hi Kaininvestor, here is a site with a substantial amount of stats and links to more detailed nation specific resources.

    http://www.internetworldstats.com/africa.htm

    Thanks for the comment!

    Posted by Benin | June 9, 2009 5:51 pm
  • Hi Kaininvestor, here is a site with a substantial amount of stats and links to more detailed nation specific resources.

    http://www.internetworldstats.com/africa.htm

    Thanks for the comment!

    Posted by Benin | June 9, 2009 5:51 pm
  • Ka-investor – Internet World Stats has some of the stats but you have to review studies done within each country to find out specific demographic information for each country. For Kenya, the study was done by the Communications Commission of Kenya. In South Africa, I have seen one done by a group of media houses banded together to sell online advertising within SA. Not all the major African internet economies have commissioned studies yet. I think this is one area we need to improve on in Africa.

    Posted by Pamoja Media | June 10, 2009 8:44 am
  • Ka-investor – Internet World Stats has some of the stats but you have to review studies done within each country to find out specific demographic information for each country. For Kenya, the study was done by the Communications Commission of Kenya. In South Africa, I have seen one done by a group of media houses banded together to sell online advertising within SA. Not all the major African internet economies have commissioned studies yet. I think this is one area we need to improve on in Africa.

    Posted by Pamoja Media | June 10, 2009 8:44 am
  • This is an excellent article that confirms what we’ve been preaching for years. Thanks for putting it together.

    . Wenze Team

    Posted by Wenze.com | June 13, 2009 5:08 am
  • This is an excellent article that confirms what we’ve been preaching for years. Thanks for putting it together.

    . Wenze Team

    Posted by Wenze.com | June 13, 2009 5:08 am
  • Thanks Wenze Team for the comment. No problem.

    Posted by Benin | June 13, 2009 6:23 am
  • Thanks Wenze Team for the comment. No problem.

    Posted by Benin | June 13, 2009 6:23 am
  • 2 Trackbacks

  • [...] sector. This is true as far as ICT innovations and the tech-world is concerned, but what about the impact on SMEs and corporates? How effectively are businesses in the region using the digital space to market their services and [...]

  • [...] sector. This is true as far as ICT innovations and the tech-world is concerned, but what about the impact on SMEs and corporates? How effectively are businesses in the region using the digital space to market their services and [...]

  • Post a Comment

    Your email is never shared. Required fields are marked *

    *
    *

    call: +254 717 514 477

    Subscribe to our Newsletter

    pamoja media blog

    pamoja media conversations