Africa contains some of the poorest parts of the world. But that only makes some of the continent’s e-commerce accomplishments all the more impressive—and worth studying by business owners everywhere.
African office workers and other entrepreneurs have managed to take relatively simple mobile-phone technologies and use them to build remarkably robust commercial systems.
The typical skilled tradesman in a big city like Lagos or Nairobi is likely to have an Internet presence as useful as any in a major metropolitan area in Europe or the United States.
The difference is that business owners in Africa don’t have complex Web pages, but rely instead on a highly evolved system of text messages. The graphics might not be as fancy, but the job gets done just the same.
“It’s all very straightforward. It’s just ‘Click here if you want to make an appointment,’ ” says Craig Holmes, a client director for IBM’s Middle East and African operations. “The systems they have developed have simplified commerce in a very basic way.”
Others working with African mobile business owners say those entrepreneurs’ innovations should be closely heeded by companies trying to do business there.
In the United States or many European nations, “simple channels are often too quickly thrown away for ‘the next big thing.’ In Africa, it’s in the unsexy technology spaces that you find most of the successful entrepreneurs,” says Erik Hersman, cofounder of Ushahidi, the mobile crisis and event-mapping platform and a developer of iHub, an organization that brings together mobile entrepreneurs and investors in Nairobi.
Whereas cellular service is well established in populous regions of Africa, Wi-Fi in homes, offices, or coffee shops is rarely found, even in big cities.
“I find it interesting how quickly people in the West write off SMS,” Hersman adds. “Sure, it’s much more expensive per byte than its data counterpart, but it’s what people have, and use, on a daily basis in Africa. We very well might see SMS services decline over the next two to three years, but if you’re building a service in Africa, ignore SMS at your peril.”
Mobile apps that use simple technologies to solve everyday problems—like making payments—usually do very well, Hersman said. This is particularly true in Kenya, where more than 14 million people use a service called M-Pesa to make transactions using mobile phones.
Holmes, who is based in Johannesburg, South Africa, is helping provide back-end services for Bharti Airtel, the Indian mobile operator that, along with several other big multinational carriers, is jostling for a position in the booming African mobile-phone market.