Is This The Alibaba of Kenya?

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“If you participate in making a change in the world, then you will make your life more meaningful.”

This thoughtful statement by Jack Ma, founder and CEO of China’s giant e-commerce company Alibaba, is one that speaks volume of how technology continues to maintain an upward trend globally and how crucial it is for the discerning to be a part of it.

The rapid increase in the number of internet users and the attendant increase in the number of online shoppers nowadays as opposed to shopping at physical stores attest to the fact that technology is ever evolving.

Ecommerce by a simple definition is the trading of goods and services online. It dates back to 1972 when the ARPANET, the first computer network was used to organize sale between students at the Stanford Artificial Intelligence Laboratory and the Massachusetts Institute of Technology in the United States.

It did not however become very popular until the late 90’s when the first ecommerce company (AliBaba) that took the world by storm was birthed by Jack Ma.

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Arguably the leading online shopping site in China since establishment in 1999, the company has witnessed a huge profitability in millions of dollars.

Worthy of note is the incredible $170 billion in sales recorded by the company in 2012, a profit margin the combination of eBay and could not match. is a good example of an e-commerce company that has weathered the storm over the decades, making jobs available to thousands of people and providing a platform for small businesses to thrive and expand to market overseas.

The group’s arch-rival EBay (an American online marketplace company), engaged Alibaba in a fierce battle for dominance of ecommerce business in China back in the early 2000s but won.

The battle for supremacy is not limited to Europe alone; it is also rife in some parts of the African continent. Apparently it is a competition and healthy competition delivers good dividends.

In the Eastern part of Africa, the significant development of e-commerce in the region as witnessed by the incursion of e-commerce companies such as Bidorbuy, Kaymu, iVeri, OLXJumia and will even see more of various sizes spring up in the coming years.  The market presents a huge opportunity for investors and business owners and rightly so, a lot of investment money has been flowing into the business from multi-national organizations which include Rocket internet, Milicom and MTN.

A report by research and analysis giants Frost & Sullivan, predicts that the market will be valued at an estimate of $50 billion by 2018, compared to the $8 billion it amassed in 2013.

In Kenya, despite the evolving internet technology in the country of over 45 million inhabitants as of 2014 and Internet users of over 21 million, e-commerce remains relatively low according to reports by an industry regulator. Issues that are yet to be completely addressed in the country range from cyber insecurity to poor quality of service delivery to inadequate return-policy system on purchased goods.

Even with these challenges, the slow but steady growth of ecommerce in the country is hoped to gradually pick and become a force to be reckoned with in Africa as a whole.  With major players like Kaymu (an online marketplace), touted to be Kenya’s Alibaba also OLX, Kopokopo and Jumia among others, experts say the future remains bright for ecommerce in the nation.

According to Kenya’s Communications Authority, Kenya’s e-commerce sector was worth Kshs 4.3 billion in 2014; two years after Kaymu was established in the country. When ecommerce companies penetrated the Kenyan market in 2011, there were many difficulties that had to be tackled specifically matters arising from insecurity and fear among consumers who were not familiar with ecommerce and were not willing to reveal their credit card details for fear being duped online but with a lot of sensitization and trusts earned, the story is gradually changing.

Insecurity is gradually becoming an issue of the past as ecommerce platform providers continue to meet it with stiff resistance essentially with the launch of new technologies to assure online users of safe shopping.

For instance, Kaymu’s Safepay process makes it easier for satisfied customers to pay sellers for successfully delivered products.

Kaymu Kenya, backed by Rocket Internet group, has maintained a rapid growth since the commencement of its operations in the country in 2014. The company started with zero subscribers as of September 2014.

Today, it has more than 7,000 subscribers – an indication that Kenyans are beginning to dump their fears of cyber insecurity.

In the country, most shoppers online are mostly found in the Nairobi city where internet connection can easily be accessed. A complete switch from analogue to digital transmission for connectivity will be required to help boost ecommerce in the city as soon as legislation is passed in favor of the switch.

In the midst of the comparatively low ecommerce culture in Kenya, the older ecommerce companies, Jumia and OLX seem to be doing really well in the East African Country.

The niche Kaymu however has is that it is a purely marketplace where sellers are connected to buyers unlike its contemporaries OLX and Jumia.  What’s more, the ecommerce company charges nothing on sales made by sellers on its platform, this it did to further encourage more sellers on its platform giving the existing ones 100% gain from profits made from sale. This is not a common feature of other online marketplaces in Kenya.

Apart from just making profits which most businesses are known for, the impact of Kaymu in Kenya is largely felt by small and medium scale enterprises most of whom have virtual shops on the Kaymu platform. Kaymu University is one of its many innovations where sellers are trained and advised on how best to interact with buyers in the course of trade.

Just as Alibaba rivals EBay, Kaymu rivals local online marketplace OLX.

The battle for supremacy is still on even as e-commerce companies try to outdo each other and the competition gets heated with the entry of new comers. The good part of this healthy rivalry is that consumers will enjoy better services.  However for Kaymu Kenya a niche market that distinguishes itself from the rest of the pack, with an edge in the marketplace with a more business to business focus, the future is only bright as gains great strides to cement it’s position as an Alibaba in Kenya.

IMG Credit: Toyohara, Flickr


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