Yesterday we had a meet with Priscilla Muhiu, Marketing Manager at OLX as she passed by over at the office. OLX is quite visible in Kenya and is one of the big companies on the fore-front of driving e-commerce in Kenya and while at it getting more users who otherwise would be only doing Facebook and Whatsapp as the only engagement online to getting to discover more that they can do with the internet.
Priscilla says it’s a long journey getting Kenyans to get used to using the free tools available to them via mobile phones. She did drop a few stats about the online classifieds giant’s operations in Kenya. A few of them include:
Kenyans use OLX much more on the Apps than they do on mobile web and desktop, that’s interesting because people need to be very convinced to actively use an app like they do with Facebook or WhatsApp. Kenyans installed the app, mostly the Android app and use it much more than desktop and web combined. That’s 100,000 visitors a day!
She says that this could partly be due to the messaging in the past where many now believe that it’s best used on the app and there is the assumption that you only get the full experience from the app. This is partly true, mainly because a recent update allows a user to save progress of an ad posting at whatever level of progress they are at should they get disconnected from the internet.
So How Do They Intend To Make Money? You ask.
Well, this is a question that has been asked over and over as people got the impression that the company is burning a lot f money and this didn’t look like it’s going to get returns, especially in a market that is quite small in terms of connected-ness. Priscilla says that they company already does make half a million Kenya Shillings every month from the ads on the site, so that means they should be able to cater for their rent every month just from direct link ads. That says a lot for a site that’s barely visually bold with their on-site advertising.
But that’s not the end. If you are worried that OLX will start charging you to do what you already do on the site at some point, take that worry off you. OLX wants you to go on using the site for free, sell those used things, sell even business items from your shop or anything you want to sell as long as it’s legal and approved. What OLX intends to do is bill for promoted listings on pages including search results. With such a heavy usage, that should be such a huge return on investment for them. Users will be able to pay for this via the usual payment methods mobile money and credit cards.
This model has already been implemented in a few countries already, and that includes Mexico and works quite well, so OLX is still quite on track with their business.