The Star (Nairobi)

12 July 2012

Kenya: Mobile Money Set to Change Kenya's Retail Shopping

Photo: The Star
Safaricom’s mobile money service M-Pesa controls 68 percent of the Kenyan market.

Two explorers are hacking their way through the jungle when a tiger suddenly appears. Both men freeze. Slowly, the first drops his rucksack, takes out a pair of trainers and begins to ease off his boots. "What are you doing, you fool ?" says the second. "You'll never be able to out-run a tiger." "I don't need to," replies the first. "I just need to out-run you."

In other words: what matters most is how you respond to seismic changes in the landscape (be it the irreversible rise of digital or the sudden emergence of a tiger). It's the speed and quality of that response which will determine whether it's you or your competitors that get eaten. The above may just be the situation the retail industry will be faced with in the next few years. Kenya has a particularly dynamic mobile industry and one that is decidedly headed towards M-Commerce as other mobile network revenue streams dwindle.

Consumers are already using mobile payments for one on one money transfer and shopping with business that they have a familiarity with. The retail industry however trails in providing value addition via the mobile phone and little more that cash receipt counters have been established. In the context of retail, there are three principal ways in which this is likely to be realised:

The opportunity to digitise the physical. When we carry a mobile, we carry a key that allows us to unlock the internet 24 hours a day. Retailers can exploit this to make every physical asset an invitation and gateway to a broader, more immersive digital experience.

The opportunity to make your offer more contextually relevant. Mobile allows brands to connect with audiences in the moment; it can leverage time and place more effectively than any other channel. Increasingly, this will be supplemented by insight into individuals' attributes and behaviours; and even their most recent actions - which is at least one of the reasons why companies like Google are making mobile wallets a development priority. It doesn't take much imagination to see the commercial potential of a marketing solution that combines knowledge of someone's recent mobile search history, their precise location, the time of day and the last thing they bought!

For multi-channel retailers, the opportunity to connect their online and physical estates in ways that deliver meaningful consumer benefits. Click and Collect is already generating substantial traction, with mobile allowing shoppers to track the delivery 24/7. Going forward, expect to see retail increasingly using in-store display to drive shoppers to their larger online inventory (via some combination of kiosks, scanning, image recognition and ultimately augmented reality, and expect solutions whereby shoppers who view but do not purchase items online are sent incentives via mobile to purchase that same item when next in proximity to a street store.

Separately and collectively, these will allow retailers to add new dimensions to their brand proposition, and to do so in ways that substantially enhance the customer experience. And those that move early and smart will be able to establish clear blue water between themselves and their competitors.

Frank is lead consultant at FMC and CEO at Mobile agency Sponge . The long version of teh above article can be downloaded as a white paper from www.spongegroup.com

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