Lower costs of data will boost e-commerce in Kenya
There is no doubt that the implementation of lower costs of data is welcome to the 99 percent of Kenyans browsing the internet via smartphones according to Communications Authority of Kenya Q3 2014/2015 statistics report but more-so it will turbo boost e-
01 SEPTEMBER 2015, NAIROBI, KENYA
SummaryThere is no doubt that the implementation of lower costs of data is welcome to the 99 percent of Kenyans browsing the internet via smartphones according to Communications Authority of Kenya Q3 2014/2015 statistics report but more-so it will turbo boost e-commerce growth in the country.
Nairobi, Kenya 1st September 2015 - Speaking at The National Forum on sustainable Data for Development held at the Laico Regency hotel in Nairobi this August, deputy president William Ruto asked mobile firms to reduce the cost of data bundles, he noted that while the cost of mobile phones has gone down, the cost of data has increased.
There is no doubt that the implementation of lower costs of data is welcome to the 99 percent of Kenyans browsing the internet via smartphones according to Communications Authority of Kenya Q3 2014/2015 statistics report but more-so it will turbo boost e-commerce growth in the country.
In 2014, Jumia Kenya increased sales by 900% after being in business for only a year. This success was to a large extent attributed to the Jumia mobile shopping applications that allows customers to browse, add items to cart and make payments from their smartphones which is among the company’s major strategy in the e-commerce take-over.
Jumia is however not the only e-commerce company banking on mobile shopping applications, others include OLX, Kaymu- online marketplace, Jovago- hotel booking site, Hellofood- a portal where you order food online, Lamudi- Property listing and Easy Taxi- online taxi requests portal among others.
According to Parinaz Firozi, MD, Jumia Kenya, "customers who use their mobile phones visit the site triple as often as those who use desktops and laptops", however Firozi notes that "high cost of mobile data discourages would be customers from surfing the internet on mobile and making purchases.”
“While Ksh. 30 assures you of 1 hour of unlimited internet in a cyber café where the cost is 50 cents per minute, the same amount can barely last 10 minutes of unlimited internet on mobile data. The fear of running out of bundles while completing a purchase online is a ghost that should be tackled by lowering the cost of data.”
Firozi further argues that lower costs of data will provide entrepreneurial opportunities for retailers to be able to sell their products online either through social commerce or listing on online marketplaces where they can access thousands of customers across the country, increase sales and profits while bridging the gap between online and offline retail.
Similar sentiments are shared by Estelle verdier, MD Jovago, “While some network providers offer monthly unlimited internet bundles for mobile you will still find a fair usage policy that caps the internet speed after some time making it slow and disappointing, lower costs of data will be a massive boost.”
But it’s not only the e-commerce companies that feel mobile data is expensive, James Mwathi 26, a medical student at the University of Nairobi expresses, “I stay outside the campus and have 3 different modems, the cheapest unlimited internet bundle I can get for a week is Ksh.999-ksh.1300 this is discouraging especially when I want to research on products I intend to buy online.”
The past year has seen local and international brands that include Microsoft, Infinix, Innjoo, Armco, Fly Mobile, Maybelline, Darling Hair, Crown, Bata, Nairobi Sports House and hundreds of SME’s open online shops on Jumia as they seek to take advantage of the nationwide delivery network Jumia offers.
Firozi remains optimistic that mobile network providers will work closely with the government to lower the costs of data.
“While lower costs of data will boost e-commerce, I can’t emphasis enough the opportunities it will open for our vibrant tech savvy generation in areas of study, research, job search, networking and much more. It’s a bigger picture.”
JUMIA is Africa’s leading online shopping destination. Customers across the continent can shop amongst the widest assortment of high quality products at affordable prices – offering everything from fashion, consumer electronics, home appliances to beauty products. JUMIA was the first African company to win an award at the World Retail Awards 2013 in Paris as the “Best New Retail Launch” of the year.
About Africa Internet Group
Africa Internet Group, the leading internet platform in Africa, promotes sustainable online growth that benefits both businesses and consumers. Firmly rooted in Africa’s startup ecosystem, the group provides easy-to-use services and smart solutions across the African internet sector. AIG is invested in furthering regional entrepreneurship and innovation through a passion for Africa, its culture and its people. AIG is the parent group of ten successful and fast-growing companies in more than 30 African countries. Its network of companies includes Carmudi, Easy Taxi, Everjobs, hellofood, Jovago, Jumia, Kaymu, Lamudi, Vendito and Zando.
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Jumia aims at creating a connected digital Africa to improve people’s lives on the continent, thanks to the Internet. Therefore, Jumia’s mission is to connect African consumers and entrepreneurs to do better business together. Founded in 2012, with a presence in 23 African countries, the group has MTN, Rocket Internet, Millicom, Orange & Axa as investors. Jumia has been creating a sustainable ecosystem of digital services and infrastructures through online and mobile marketplaces and classifieds to expand your horizons.