The cost of mobile phones has decreased steadily, and what was once considered a luxury good is now a necessity for many Kenyans.
In order to understand mobile phone usage at the Base of the Pyramid (BoP) in Kenya, iHub Research and Research Solutions Africa conducted a 6-month study, funded by infoDev (World Bank).
The study covered urban and rural areas of 6 districts in Kenya. Its findings are not nationally representative, but comparisons with representative surveys show no significant differences for key indicators, such as phone possession. The advanced draft report is available athttps://blogs.worldbank.org/ic4d/files/ic4d/mobile_phone_usage_kenyan_base_pyramid.pdf
The final report will be released to the public by the end of 2012.
The following are some initial findings from the study:
- 1 in 4 Kenyans at the BoP browse Internet on their mobile phone
1 in 4 Kenyans at the BoP stated that they browse the Internet on their mobile handset, though very few knew what data bundles were. Therefore it seems that the BoP are either using pay-as-you-go Internet plans or, more likely, taking advantage of offers to use Internet for free. For example, Essar Yu offers Free Facebook browsing
and Orange Kenya has recently started offering Free Wikipedia access
- Low awareness of other existing mobile applications
A number of mobile applications targeting the BoP have been developed; it is however evident that, other than M-Pesa (of which the majority of our respondents were aware of), there is low awareness of most other applications, and woefully low usage of applications on a variety of platforms.
So, what does this mean? Creative marketing of your product is critical. It is not enough to have a beautiful product that meets everyone’s needs. You need to get the word out there! We found that TV advertising and word of mouth were the most often cited ways the BoP received information about new products.
Keep in mind that just because someone knows about your product does NOT necessarily mean they will use it; but if someone doesn’t know about your product, they DEFINITELY will not use it.Thus, rather than simply having no marketing strategy whatsoever, it would be very beneficial for start-ups to thoughtfully develop a feasible marketing plan for their business and to actively work towards implementing it. As a start-up, you are well placed to develop innovative, on-the-ground-based approaches to marketing. For example, partnering with community radio stations to host a Q&A session about the technological product could help you toreach new users much faster, or in urban communities, small fliers and posters could be equally effective. Consider building strategic partnerships with media outlets that might benefit from your product or data as well.
- Health and education Information most desired
Of the information most desired by the BoP, health information topped the list followed closely by educational information. This suggests that despite the increase in the development of ICT applications tackling issues in the health, education, and agricultural sectors,none of these applications have yet been able to reach scale the way that mobile phone-based financial products have been able to in Kenya. Again, this points to the need for a clear marketing and outreach strategy for tech start-ups who are building for the BoP market.
- 1 in 5 forgo an expenditure to buy credit
One in 5 respondents interviewed had foregone some usual expenditure in order to reload their phone with credit. Among those who forgo a usual expense, it was established that on average they forgo Ksh72 in order to reload and use their mobile phone.
This illustrates that, if the value of making the call or SMS is perceived to be great enough, the BoP will spend for it, even if it means they have to forgo other expenditures. If the value is not seen as great enough, the BoP will not spend their money on it. In short, the BoP can be your customers, but you need to prove to them that your service/product is worth it! What will they gain in return and how certain can they be of that outcome? Make sure your marketing campaign addresses these questions about your product’s value-add.
- Calling, SMS, Mobile Money Transfer are the major uses
Nationally representative data reveals that the top three activities conducted on the mobile phone by the BoP are calling (100%), SMS (95.2%), and sending/receiving mobile money (68.8%) (RIA 2012). The 68.8% of BoP that use mobile money in Kenya reveals a potential service channel that could be tapped into for both Government service delivery (e.g. welfare distribution or tax collection) as well as other new innovations.
- No difference in mobile phone usage between men and women other than mobile Internet usage, which is dominated by educated male youth
Similar to LIRNEasia findings (2006 data) in the Philippines and Thailand and findings from Ghana, Uganda, and Botswana (Scott &McKemey, 2002), no significant “gender divide” was noted in mobile phone usage patterns. The one exception was in the usage of mobile Internet where 18-29 year old males were found to browse the Internet and conduct online activities on their phones (Skype, download mobile applications, check email, etc.) the most.
- Higher likelihood of technology usage by those educated past primary level
Not surprisingly, there is a higher likelihood of technology usage by those at the BoP with more education. Most respondents without any formal education did not send SMS messages, browse the Internet on their mobile phone, nor use M-Pesa as much as their educated counter-parts. This pattern has also been noted in the literature (Scott &McKemey, 2002).
It will be very interesting to see how the recent switch off of approximately 2 million “fake phones” by CCK and MNOs will affect the BoP, as it is anticipated that most of the owners of “fake” phones were those at the lower economic strata. It is likely that many of the phones being used by the BoP to access Internet-based applications (like Facebook) were switched off. If former owners of such phones cannot afford to purchase similar Internet-enabled genuine phone replacements, we may find more genuine, but basic phones being used in Kenya in the short-term.
Based on these key facts and other insights gained from the research, we advise mobile application developers focused on BoP to develop for their users’ specific needs, and carefully ponder their technological platform choice. We believe that due to the difficulties faced by mobile application start-ups for scaling, collaboration amongst the stakeholders in the mobile telephony industry is critical for relevant mobile applications to reach the BoP.
If Government, MNOs, Donors and Investors, and Local Content Developers can form meaningful partnerships, the applications being developed locally may be able to scale further and faster, thereby hopefully helping to alleviate some of the poverty at the base of the pyramid in Kenya.
Essar Yu launched free browsing on Facebook 24/7 in December 2011 in an attempt to expand its subscriber base.
On August 20, 2012, Orange Kenya announced that subscribers of Orange with an Internet-enabled mobile phone will be able to access Wikipedia as many times as they want at no cost through their Internet browser (http://allafrica.com/stories/201208210174.html