SMART AFRICAN COMPANIES ESTABLISH IN-HOUSE MARKET RESEARCH CAPABILITIES.

2013-01-26T10:04:00.001-08:00

Smart managers rebuild in-house research capabilities, invest in strengthening the company's ability to identify preferences and analyze behavior of the emerging consumer.

After 21 Years of leading start-ups and expansion initiatives, both publicly ( listed ) and privately owned companies, across industries and markets, coupled with experience gained working with multi-nationals as consultant in African markets, personally the single most important function or capability that set companies apart from competitors, without a doubt the ability to interact with the consumer in both a meaningful and flawless way, gathering their own consumer and market information, focusing on specific cultures, geographical areas and then incorporating results, not only to help tailor products to local needs and preferences, but also help identify new categories for growth, help to made accurate adjustments, instead of depending on limited, and not so reliable data from other research firms.

With the emergence of Africa together with other regions as new economic powers, conventional thinking is rapidly replaced by a new set of realities and consumer centricity's, requires the ability to veer away from established formulas and ways of thinking, companies looking to prosper in 21st century will need to explore segments and regions beyond their traditional markets. African markets present very unique challenges, with boundless opportunities, which requires a combination of specialized expertise and experienced leadership. The unavailability of reliable data and fact based strategic insights shortage is made even more challenging because of the diversity of both markets and far from affluent, homogeneous African consumers, with unique values, perceptions, constraints and drivers. I see myself as fortunate to have worked with various senior managers and investors seeking to establish, or expand on, African footprint, and without exception acknowledge both the importance and long term value of establishing in-house research programs.

But where do you start, collecting consumer and market data in a foreign country, from total strangers, with very diverse cultures. Not even the local Mobile network operators have basic data, such as age, gender and address, since no information is exchanged with pre-paid subscribers, that represents 95% of Africa's total mobile users, only 13.5% of population has access to inter-net, with less than 4% using social media- this explain the challenge and importance of creating own source of information. Most multi-nationals have used the “Business -to - Business partnership “as strategy to provide a viable solution to the unique challenges African markets presents. Identifying African firms with high growth potential is difficult because of a lack of performance and credit information, and requires large investments e.g. (51% acquisition of South-African based bank Absa, by UK based Bank, Barclays 5 years ago, for a consideration of approximately ZAR 50 Bill, not without risk, of cultures who might not mesh, with no guarantee for fast tracking effective market penetration) The business - to - business partnership, as strategy has worked for a few. Companies partner to better deal with issues, to enhance the required skills, experience, but its reputation and the commitment of its people that underpins sustainability. Mobility is in full throttle, helping consumers use their virtual network to access a growing portfolio of content, services and apps While the vast majority of mobile commerce discussions and research focus on mobile payments, this alone is not enough to drive consumer adoption, it's crucial to ensure consumer buy-in, getting consumers excited is not the same thing as capturing the market.

Mobile money service providers have spent millions of Dollars trying to Woo.., only to realize, YET AGAIN that the biggest competitor they face in scaling Branchless banking is not a rival MNO or bank or even expensive money transfer operations, it's cash. Cash is by far and away the preferred method of storing and sending money. Instead the Business - to Consumer partnership as strategy to achieve business objectives, through an inclusive and transparent process, this requires the ability and willingness to engage groups that represents the broader consumer profile of the region in which the company operates, managers will find it very difficult to find the undeserved niche markets, and basically impossible to meet their product and service requirements without a strategy that encourages ongoing interaction with the broader consumer base.

I'm only aware of two business icons who successfully matched consumers demands and expectations, from a standpoint; that consumers don't know what they want, so why bothering asking, Henry Ford famously said " if I'd asked people what they wanted, they would have said, faster horses " and Steve Jobs who said " it's not the consumers job to know what they want". Genius is in short supply, there are 1000's of business people who thought they knew the next brilliant product and are now staring at a cash flow statement soaked in red. My experience of the African consumer is a bit different, and more so with the rural poor, where you know that the consumer will not be satisfied, with exactly what they asked for on delivery date, this requires foresight, and knowledge to know when and how to intervene. This is only possible within a relationship that is based on mutual respect and trust, as we all know; - Trust lost departs on a fast horse and returns, if ever, slowly on foot.

In the majority of cases consumers choose not to disclose, or supply just enough information for the person to go away, the consumer is under no obligation to assist you in running your business. ! - To really understand what consumers need will require very hard work, you must really care about the consumers needs, aspirations and fears, the truth is inescapable, caring forces you to do the hard things that anyone else with just as much talent as you isn't willing to do, to dig deeper, you will then embrace two way communication with the consumer, you will be patient, consumers must be comfortable, trust must be earned, for consumers to disclose meaningful information that will support accurate delivery on consumer expectations and real needs.

It's wishful thinking to treat the “information gathering exercise” as a once off event. It's just the opposite of what business schools are expecting from students during field exercises. Students are dropped off to interview consumers to gather information or feedback on new service or product ideas, the value of this market research will be very limited, to say the least, and not be worth much. Although very encouraging to see how young entrepreneurs value interaction with the Emerging consumer. Companies that don't recognize the essentials of both consumers and society will sooner or later fall.

Posted by Corne Ferreira

Website: http://Ferreiraconsultants.com