M a r k e t N e w s

Africa: Kenya Ahead of Rivals As Africa Goes Digital

Posted on : Thursday, 20th October 2016

 Kenya is poised to become Africa's first mobile money economy, a newly-released study indicates based on the steady rise in cashless transactions for goods and services.

The study by consultancy firm Deloitte says Kenya is ripe for mobile money revolution and asks local businesses to shift their sales models with the emerging reality to stay ahead of the competition.
The impending mobile payments revolution marks yet another first for Kenya, which has been a front-runner in mobile transactions backed by innovations such as mobile transfer services, M-Pesa.
The Deloitte report says continued use of mobile payments has reached a critical point where it is posing a threat to traditional retail models based on cash.
The study found that 11 per cent of Kenyan consumers are already using mobile payments - more than five times Nigeria's two per cent, nearly three times South Africa and Uganda's four per cent and ahead of Zimbabwe's seven per cent.
The figures represent only transactions paid for using mobile money, excluding mobile money transfers.
The Deloitte study also found out that Kenya remains way ahead of its African peers on use of mobile money transfers with 33 per cent of its population making use of the platform compared to Nigeria's 11 per cent, South Africa (15 per cent), and Zimbabwe (11 per cent).
Kenyan consumers were also found to be adopting mobile money faster their African peers placing it in pole position to becoming the region's first digital economy.
"The level of adoption of these services is currently low and the gap represents a significant monetization opportunity for operators," the Deloitte report says adding that 50 per cent or more of the mobile phone users had demonstrated a willingness to go cashless.
The report urges businesses to tap the anticipated mobile money opportunities by investing in understanding consumer behaviour to stay ahead of the competition.
"The holy grail of retail right now is understanding shopper behaviour live. As they move around you want to impact their decision to buy while they are in the store," Deloitte Advisory Leader for East Africa Rodger George said when he released the report on consumer trends.
Changing models
Prof George, who is also a visiting professor of the Graduate School of Business at the University of Cape Town, said Kenyan businesses must do more to tap into the huge opportunities that are emerging in the mobile phone economy.
Use of mobile phones has become an integral part of Kenyan lives a development that is confirmed by the fact that they are interact with the devices more than users in any African country.
The study found that 71 per cent of Kenyans look at their phones within five minutes of waking up with a further 53 per cent looking at their phones before sleeping.
Besides, 40 per cent of Kenyans use their phones in public transport while 28 per cent use the devices while watching TV.
Retail Trade Association of Kenya chief executive Wambui Mbarire urged retailers to align their business models with the emerging reality.
Tifa Research director Maggie Ireri said businesses that fail to adopt to the changing model risk losing out to rivals or perishing altogether.
"The widespread use of mobile phones will have a profound effect on ways businesses operate making it imperative to respond accordingly," she said.
The opportunity to tap the mobile phone use is expected to increase as more Kenyans adopt smartphones use backed by strong economic growth, and operators increase their investment in mobile data networks.
"As smartphones become ever more embedded in our lives, we see new opportunities and challenges for the mobile sector, retailers and advertisers," said Deloitte.
Some 53,000 respondents across 30 countries were surveyed, including South Africa, Nigeria, Kenya, Uganda and Zimbabwe.

Source : allafrica.com
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