Ecommerce Business in Kenya is taking a toll on the owners. Most of what we have got from their financials are huge losses. For Kenyans, all we are interested in are discounts at whatever expense. May be we are all to blame!
Masoko, one of the renowned e-commerce platforms in Kenya seems to be breathing its last after about two years of operation. Safaricom, through the platform aimed at connecting Africa by providing customers with an online shop where they could access products in variety. They promised an aspirational African style empowering African business people both big and small with an aim to change the African shopping culture.
Studying the e-commerce trend in Kenya, for instance, Jumia, Kilimall, Sky Garden and the likes, it is evident that this is a tough field to venture into. Some of these platforms have accrued losses year in year out getting to as high as billions. May be, Masoko can explain to you better this kind of business retrogression.
Mybigorder Kenya must have seen this trend and decided to learn the lessons early enough. This is the only online platform that I’ve seen with a different business model. The platform started as an order-taking platform early in 2018. Later, they decided to do more than just order taking and deliveries which was based on Geo-Fencing technology. They signed up thousands of vendors and gave them a platform where they could sell and the business was on.
As the sales were getting hyper and hyper, Mybigorder saw a loophole that could be what has been pulling down all the rest. Having in-house developers helped them do a re-strategy- they started with an overhaul of their system. Actually they did a completely fresh system and announced the data migrations to their previous vendors. Only willing vendors were transferred to the new site.
Mybigorder’s new model focuses on youth in all the 47 counties with an aim of connecting even the ones in the deep of the village to the urban world. The management confesses positivity of the same,
“The new Mybigorder is now working fine in the 47 counties. Having the backing of My Leader Kenya’s #VijanaNaBiashara, we have managed to get the Kenyan youth on board both as vendors and as customers. We are happy we rebranded.” Said Mr. Alphonce Juma, CEO and Founder.
It is a sad truth that Jumia has so far sunk into losses amounting to billions; as early as in April 2018, they registered a Kshs. 14 Billion loss. This has kept on growing capped with a number of integrity issues on the same platform. This is just one of the examples.
E-commerce platforms have become the ‘never invited’ social media friends. Kenyans know them by default through their marketing. Paid Ads, Bulk SMS, not forgetting the traditional media commercials have been their strength and strategy on marketing. Ask any Kenyan and they will tell you, anytime they log-in to their social media platforms, they meet an e-commerce Paid Ad. Again, no one week ends, without you receiving a text message informing you of ‘E-commerce X’ new offers.
What does this kind of marketing do? One, we cannot deny its power to create awareness but the truth is, one would spend quite a lot on it – amounts that you might never get to recover. This is what the e-commerce platforms have done, their marketing is on another level; topnotch if to use one word. The ROI is however absent- truth reveals it as negative.
If I was to advise, I’d point the likes of Masoko, Jumia, Kilimall and the rest to Mybigorder Kenya. This is an online market place that has managed to bite the much it can swallow. They have embraced organic online marketing without relying on Paid Ads which have proved not so yielding.
Through the strong support given by its mother company, Oracom Web Solutions, it’s digital marketing training wing, OraDMT as well as its photography department, Oramedia which does product photography for the vendors, Mybigorder has managed organic marketing just perfectly. Today, the platform can pride in profits less than two years since its launch.
Masoko has now shed off all of the other dealings; they have released all the vendors. Currently, the platform is only selling Phones and accessories. No one needs some special meeting to learn that the ‘new Masoko’ is simply the Safaricom shops we know, brought online. One would hence be right to say that the Masoko we’ve always known is over.
During the Safaricom’s annual business report reading for the year ended 31st March, 2019, the mobile network agreed to have made mistakes with Masoko. They informed to be on a re-working process to correct the wrong. The outcome is now here in the public- the result of the ‘re-work.’
Safaricom sent an official email to Masoko vendors on 5th November informing them of the discontinuation of the selling on the platform. Following is a section of the email:
E-commerce business in Kenya is an area that needs deeper strategies than anybody ever thought. In conclusion, I’d like to lay some good amount of blame on the Kenyan business people vending on these e-commerce platforms. Vendors do not want to lower their prices but still cut deals directly with a customer. Due to that, vendors have also been hard hit with not more than 40% not making 2 years in business.