may 2015: the growth of the smartphone market in kenya
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GAJAH ANNUAL REPORT 2015 | 1
THE GROWTH OF THE SMARTPHONE MARKET IN KENYA
Download the whitepaper: www.jumia.co.ke/blog
AFRICA’S #1 ONLINE RETAILER
13COUNTRIES
3000EMPLOYEES
OWN WAREHOUSE OWN DELIVERY FLEET OWN CALL CENTER
END TO END CUSTOMER FOCUS
Putting the customer first.
FLEXIBLE PAYMENT FREE PICK-UP POINTS FREE 7-DAY RETURNS
AFRICA’S #1 ONLINE RETAILER
2014 – Our year of Hypergrowth2013 – Jumia wins world retail awards
Best new retail launch of the year
Dec-13
Jan-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14Jul-1
4
Aug-14
Sep-14
Oct-14
Nov-14
Dec-14
Jan-15
Feb-15
Orders Shipped
Orders Shipped
+900%
AFRICA’S #1 ONLINE RETAILER
2015 – The trend continues2013 – Jumia wins world retail awards
Best new retail launch of the year Dec-14 Jan-15 Feb-15 Mar-15 Apr-15
Orders shipped
+100%
Become the launch pad forbrands existing in or entering Africa
WHERE WE ARE HEADING
One stop shop for brands
Africa-wide network and distribution
Largest online and offline retailer
THE KENYAN ECONOMIC LANDSCAPE
Economic Growth
73% of all internet users in LSM8+
5.7%
‘13 ‘14 ‘15
5.3%
6.5%
3rd fastest growing economy in the world
LSM 5-7: 29%
LSM 8-11: 17%
LSM 12+:5%
LSM 1-2: 13%
LSM 3-4: 36%
Middle Class
THE KENYAN DIGITALLANDSCAPE
Internet penetration
World: 42%
Africa: 26%
Kenya: 58%
Mobile penetration
World: 51%
Africa: 79%
Kenya: 83%
Social Media
World: 23%
Africa: 7%
Kenya: 19%
THE SMARTPHONE MARKET
Units sold
2015
2011
7%
58%
Average price
KSh15,000
KSh10,000
Nairobi sales
70%
43%
Brands
22
15
INCREASING COMPETITION
Competition among device makers is the single biggest factor driving the growth• New entrants• Cheaper models by incumbents
# brands capturing 70% of market
% smartphone sales under $100 in MEA
5%2013 20%2014
2011
4 2015
7
SURVEY OF SMARTPHONE USERS
576 Respondents
Smartphone owner
Knowledgeable about e-commerce 64%
36%30%
59%
10%
2%
18-24
25-34 45+
35-44
When did people buy their first smartphone
4% 35% 54% 7%
2004 - 2007
2008 - 2011
2012- 2014
2015
FIRST SMARTPHONE
7%
20%
24%
49%
LAST SMARTPHONE
Less than 6 months ago
6 months – 1 year ago
2 years +
1 – 2 years
LIFETIME SMARTPHONE OWNERSHIP
35-4418-24 25-34
3.34
3.053.22
2.53
2.69
1.95
2.86
Young people are willing to invest to keep up with the latest technology trends
Men in older demographic more open to new technology than women
SMARTPHONE ACTIVITIES
69%
44%
78%
33%
49% 45%
26%
57%75%
69%
25%
E-MAILS
NEWS/CURRENT AFFAIRS
CHATTING/SOCIAL NETWORKING
READINGBOOKS/ ARTICLES
ENTERTAINMENT/GAMES/ MUSIC/ VIDEO
CHECK WEATHER / SPORTS SCORES/ STOCK MARKET
ACADEMICPURPOSES
ONLINE SHOPPING ONLINE BANKING CALLING GENERAL SURFING/BROWSING
BIGGEST FRUSTRATIONS
DATA LIMITS
MEMORY STORAGE
BATTERY LIFE
SERVICE / RECEPTION
SMALL SCREEN SIZE
DATA PRIVACY
PROGRAM CRASH
CAMERA QUALITY
29%
47%
78%
16%
19%
13%
36%
30%
KEY TAKEAWAY
With Telcos#JumiaMobileWeek + Airtel: Free 6GB credit for all phones
With app companiesPre-install relevant apps
With retailers6 top brands + Jumia.co.ke, who invests in marketing & delivers to customer on brands’ behalf
Quality is king. Kenyans are willing to switch brand loyalty if they can find better features and service at a cheaper price elsewhere. Brands must get creative to win the price war through partnerships.
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