We admit we didn’t see this coming. Lenovo, the company that now owns Motorola Mobile has packed its bags and formally exited the Kenyan market as of the second week of March. The company is said to have laid off over 90% of its Kenyan staff in December of 2017.
A reliable source has informed Techweez that Lenovo East Africa closed shop in Kenya last week after the last two employees were sent home. It is believed that the company has had tough luck penetrating the smartphone market that is dominated by Transsion’s TECNO and Infinix. It seems that Lenovo East Africa did not make sales big enough to convince their parent company that their doors need to stay open.
It’s not just Kenya, Lenovo has reportedly shut down all its smartphone operations in Africa after seeing that they could not compete effectively without bleeding funds. However, the company is said to continue selling their phones in the region through distributors from UAE.
This is not the first time that a smartphone maker has exited Kenya, a good example of notable exits include Wileyfox, LG, Mi-Fone and Alcatel among others. However, we all thought that Motorola would survive, even thrive – Motorola wasn’t just any smartphone player entering the Kenyan market, it was a legend returning, just like we saw Nokia make a great come back. It is heartbreaking to think that such a loveable brand would be swallowed by the waves of budget smartphones.
The fall of Moto
Despite hitting us as a surprise, Lenovo didn’t exactly make good decisions when they returned to the Kenyan market early last year. First, the company launched smartphones that were outdated. In February 2017, Lenovo launched the Moto Z and Moto Z Play in Kenya, devices that were over 6 months old in the global market. These “outdated” devices were then sold at high prices, the Moto Z was going for Kes.70,000 and the Moto Z Play was retailing at Kes.55,000.
Secondly, the company made the mistake of launching flagship devices first, in a market that is price-driven such as Kenya. Yes, the Moto G4 Plus was already selling locally but they [Lenovo] did not make noise about it. They later on, in June, Lenovo launched the Moto G5, G5 Plus, Moto C and C Plus, all which came at a much more affordable price point but at this time, the damage had already been done.
The third mistake the company made was betting solely on nostalgia and brand recognition to hit the ground running. Well, turns out Kenyans love being reminded and they’ll buy what they see. The lack of advertisements and endorsements for the Motorola brand also contributed to its demise; the people with the money hardly knew they existed locally and those that cared to know just weren’t enough to make significant sales.
The storm is not yet over
It’s not just Moto packing their bags, Vivo didn’t even make it to the shelves. Vivo, a company affiliated with OPPO, was preparing to enter the Kenyan market when they realized that this game is not for the faint-hearted. A source close to the company told Techweez that as of mid-February, Vivo Mobile had abandoned plans to launch in Kenya citing the competitive nature of the space as the reason to abandon ship.
We have also heard of rumours here and there that Wiko was preparing to exit the Kenyan space but as far as we know, the French company is still holding on to its last breath.
There’s still hope for us though, Xiaomi, a major Chinese manufacturer that had entered Kenya a while ago then went under after failing to impress the consumers, is back at it, this time with Jumia as their main distributor and a couple of influencers sharing selfies on social media. Let’s hope this strategy pays off for them.
Updated with Official Statement from Motorola:
“To grow and protect our Motorola business, we are rationalizing some of our organizations and as a result are deploying a new strategy and operating model in some countries. In Kenya, we will transition into an exclusive distribution model for independent and organized retail where our business partner will manage our day-to-day business with the support of the Motorola regional team, and our operator business remains as it is today with a direct partnership with trusted partners like Safaricom. Our main goal is to ensure consumers can choose the best of Motorola products in the Kenyan market and keep a strong overall customer experience including after sales support.”
