Whilst more and more customers in Europe and America are reluctant to be on the web without the latest adblocker, Africans are eagerly embracing the opportunities presented by the new age of consumerism. According to a McKinsey report, the continent’s consumer-facing industries are expected to grow by $400 billion by 2020.
Profiling the African consumer
Africa’s new class of consumers has a smaller family, is better educated, often lives in cities and is digitally savvy. It is also the fastest growing and youngest in the world – and looks very different from Asia or America. The typical African customer in Nairobi, Lagos or Johannesburg pays for their solar electricity with mobile money. Farmers check the weather, the news or watch TV on their smartphones and communicate with their buyers over whatsapp. Over the next five years, GSMA reckons that the continent will house 725 million unique mobile subscribers with the majority based in Nigeria, Egypt, South Africa, Ethiopia and Tanzania. The same report finds that in 2015, mobile technologies and services generated 6.7% of GDP in Africa, a contribution that amounted to around $150 billion of economic value.
The digital opportunity
The opportunities for digital marketing seem abundant: it is more effective, economical and enable businesses to reach different customer segments. For example, digital marketing through Google Adwords helps companies to become more customer-centric and measure impact immediately. However, it is crucial that businesses recognise some of the challenges that going digital in Africa still hold.
Africa is still considered an emerging market, with the rate of internet penetration quite low as compared to her Western counterparts. Internet World Stats estimates a 26.9% internet penetration rate in Africa, contributing to only 9.1% of the world users. This means that most customers are still offline, and thus the percentage of online reach would still be less if a company is to entirely depend on online marketing. This combined with the recent shutdowns of the Internet by Governments in Cameroon, Democratic Republic of Congo and Ethiopia poses a challenge for companies relying solely on digital marketing. Data packages also remain prohibitively costly for the majority of customers sparking protests such as the #datamustfall campaign in South Africa. The persistent lack of data on the African consumer makes it also challenging to target campaigns at the right segment.
Where some see limitations others see opportunities. Cape Town based experiential marketing agency Instant Grass for example delivers customer insights to big brands through a personalized network of ‘grassers’ across the continent. A new crop of consumer research startups, including Kasi Insight, mSurvey in Kenya, and Opolox in Nigeria use the rise of the mobile phone as their instrument of choice to help marketing agencies develop their strategies.
Digital education is key
Expanding IT literacy and digital education is key and it is eagerly taken up by women entrepreneurs. The OECD’s recently published Future of Business Survey suggests that women-run businesses are more likely to leverage online tools to make their businesses succeed. Stories such as the one of Saudat Salami, who grew revenues in her pre-prep cooking business in Lagos by 30% after advertising on Facebook, are clear indicators that the future of business is digital. Facebook and Google are quickly becoming the dominant advertising platforms due to their accessibility on mobile phones.
Stats leave little room for doubt; Africa represents a huge growth market and technology and innovation will underpin its digital revolution. As usual, Google is at the forefront of these efforts: in 2016 it has already trained about 1 million Africans to gain terms of digital skills!
The Google’s Digital Skills Program offers 89 courses that can be taken online or offline to help mostly young people across Africa better understand how to take advantage of the web. For the offline part, Google works with 14 partners across many countries in Africa.
Alongside our work on the Digital Garage program in the UK, we are delighted to have been working closely with the Google team on their Africa Digital Skills program, on creating uniquely engaging, practical and immersive training content that will hopefully help to reach the next million users.