Fans are choosing not to watch live football events, and instead are opting in increasing numbers for the ‘intimacy’ of their crystal clear digital flat TV screens, or not all
At the ongoing Africa Cup of Nations in Egypt, the visual imagery of almost empty stadiums is a powerful narrative. But not the kind that African sports, African football, or corporate sponsors deserve.
The empty seat syndrome suggests that football fans are voting with their feet, or better still with their backsides. Fans are choosing not to watch live football events, and instead are opting in increasing numbers for the ‘intimacy’ of their crystal clear digital flat TV screens, or not all.
Before Egypt’s stunning 0-1 loss to South Africa in the round of 16, the host country was the only team able to attract 70,000 fans. Other than when Mo Salah and the Pharaohs have been on the field, most stadia across Egypt have at best attracted an average of 5,000 to 7,000 fans.
Official broadcast camera crews have done a creative job minimizing the visual gaps of empty seats. But wide camera angles reveal the obvious … a lack of attendance and public enthusiasm, in spite of the presence of some of the biggest names in world football on the field.
In European football leagues, where many of the stars in Egypt ply their trade, fans pay mega bucks to see the likes of John Mikel Obi, Ahmed Musa, Sadio Mane, Ryahd Mahrez, Nicolas Pépé, Wilfred, Zaha, and Kalidou Koulibaly.
Which is why the empty seats in Egypt are both stunning.
Admittedly, Egypt bailed CAF out and should receive well-deserved credit for coming to the rescue and hosting the African Cup of Nations, with barely 6 months notice, when the original hosts were sanctioned due to shoddy preparations.
Nevertheless, the lack of attendance in Egypt speaks volumes high ticket costs; the timing of matches bang in the middle of work days; the difficulties faced by national team supporters in obtaining entry visas to Egypt; and challenges with the Confederation of African Football’s complicated online ticket purchasing system.
It should not be so. This, after all, is the most important event in Africa’s sports calendar. At least, it used to be before England’s Premier League, Spain’s La Liga, Italy’s Serie A, and Germany’s Bundesliga captured our collective imaginations.
The end result is that where once 30,000 to 70,000 fans a week watched highly competitive domestic football leagues across Africa, the empty seat syndrome has been the norm for almost two decades. It is not unusual to have less than a thousand fans in a stadium that seats 30,000.
The lack of fan attendance has obvious economic and financial implications across the sports value chain for team owners, sports federations and confederations, players, sponsors, advertising and marketing agencies, merchandisers, vendors, and local communities who once counted on fan attendance to boost fledgling economies.
What’s responsible for the increasing slide in fan attendance?
1. Poor facilities
2. High ticket costs
3. A lack of reliable transportation to and from venues. As well as sufficient and secure parking.
4. Increasingly crude behavior and violence at event locations.
5. Technology. Mobile phones and Apps that carry events live as well as a plethora of entertainment alternatives. In other words, once big events are no longer the main gigs in town.
So, what can be done to reverse the trend? Here are 5 quick suggestions.
1. It can no longer be business as usual. Africa must run sports as a professional business. This includes the right infrastructure, training facilities, attractive pay scales for professional athletes who now consider anything less than a European league appearance, a professional failure.
Regrettably, as with Africa’s overall propensity to simply export raw materials instead of adding value to what we produce, we are doing the same with football and many other sports. Africa has a tremendous abundance of potential talent that for the most part (with the exception of South Africa, Kenya, and Ethiopia) we add little or no value to. Instead, millions of genetically blessed athletes are simply waiting or begging to be ‘found’ on the cheap by European and American sports teams. Why? Simply because we fail to see diamonds in the rough and because we are unable to add value to the potential of what for now seems to be rough stones.
2. Modern and professionally maintained facilities: In sizzling hot Africa, we must invest in covered stadia. When I can sit in front of my big screen TV in my air-conditioned living room, why would I want to subject myself to temperatures that I swear have gone up a number of notches in recent years?
3. Sport is a spectacle. This includes everything including pre-event and half time entertainment to keep fans with short attention spans upbeat and engaged.
4. Give back to the fans: Essentially, engagement in the 21st century must change. Its time to give something back to fans rather than fleecing them at every opportunity with sub-standard services and products. It would seem to me that sports teams could offer something as simple as raffle draws that reward fans with extra game tickets, signed player jerseys, visits with select players, or products from local sponsors. Professional marketing firms can come up with an endless list.
5. Make sports big and make it a win-win proposition.
Real Madrid F.C. and Barcelona F.C. for example, are not owned by a few rich individuals. Instead, they are owned and supported by thousands of shareholders known as ‘socios.’ Across Africa, it’s time to change the numbers game – in ownership, money, and attendance – by giving fans a seat at the table.
These are just a few quick ideas. However, the running of sports in general and football in particular as a business and a brand proposition will require honest analysis, political and financial will, and a collective approach.
It must be if Africa is to unlock potential and turn millions into billions.
Dr. Victor Oladokun is the Director of Communication and External Relations at the African Development Bank (www.AfDB.org).
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.
South African crypto-based startup Wala has come to its end. The startup’s premises, after 4 years of being in operation, are no longer open for business. Founded in 2015, Wala initially provided access to transactional banking, remittances, loans, and insurance, working with specialist providers to offer a full suite of financial services.
However, the startup became crypto-focused in 2017 with the launch of utility crypto-token Dala, which Wala hoped would support the operationalization and further development of scalable, blockchain-enabled financial platforms for emerging markets. It did this by raising funding from Newtown Partners and then bagged US$1.2 million in addition through a token sale.
Here are the key reasons why the startup closed down
Funding
Initially, Wala was coasting home clean. The startup which won the Zambezi Prize late last year, secured over 150,000 users, mainly residing in Uganda, within months, but founder and chief executive officer (CEO) Tricia Martinez said it soon ran into problems.
“We had little funding and limited resources while tackling a massive global problem. With over 150,000 Dala wallets and more and more partners wanting to work with us we had a lot on our plate with limited resources,” said Martinez.
However, when it became time to fundraise again, Wala was not successful, in spite of its team believing its rapid growth would make it attractive to investors.
“I began fundraising at the start of crypto winter, which certainly didn’t help. For whatever reason, not many investors wanted to back a crypto company, let alone a startup focused on African markets,” Martinez said.
“For eight months I traveled across the globe, pitching investors in blockchain, fintech, impact, African-focused… I met and engaged with over 100 investors, and despite our early growth numbers, we couldn’t secure the necessary financial support we needed to continue growing and operating.”
Wala began cutting back, turning off deposits and laying off most of its team, but on June 24 it turned off its app entirely.
Martinez also said activities of scammers and infrequency of service supply from the startup’s partner networks also contributed to the downfall of the startup.
“Rewards attracted scammers or people who figured out how to take advantage of a rewards system. This led us to change our rewards model multiple times and have to remove users who were abusing our system,” she said.
“The biggest problem we ran into was infrastructure. Our partners’ systems upwould regularly turn off due to internet problems or their own poor infrastructure, which meant our users were unable to transact, which was the biggest use case for Dala. This crushed our user engagement and most importantly trust in our system. It also forced us to expand the scope for Dala. We had to build even more infrastructure than we anticipated at the start,’’ she said.
A Ruined and Devastated Startup
The startup expressed shock over this reality.
“Our team was devastated to say the least and our users were upset. We provided a free financial payments system to consumers that solved a huge problem for them, but we didn’t have the funding to scale operations and solve the infrastructure problems that existed in these markets,” said Martinez.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
At only 26, William Elong has already written his name in the book of African geniuses by launching the first drone made in Cameroon. William Elong created this feat by launching the first civilian drone service made in Cameroon.
The promoter of the Cameroonian startup Will & Brothers and Algo Drone, whose holding company is based in Germany, wants to challenge the giants of the sector in the international sky. To achieve this, the young entrepreneur who graduated in strategy and economic intelligence from the Paris School of War announced last January that the startup had raised of 2 million euros, a little over 1.3 billion CFA francs in funding.
No Degree In Robotics
William Elong was categorical when he spoke with the French online magazine, Sputnik on the sidelines of the week digital innovation in Yaoundé recently, that he had no previous background in robotics.
“I have absolutely no degree in robotics or embedded system,’’ he said. ‘‘I did business studies instead. However, I worked for companies in the security sector for a few years: Nexter (a manufacturer of armored vehicles) where I was an economic intelligence consultant and Thales Cameroon that offers cyber security services. It is through these field experiences in the field of security that I understood what were the issues related to the issue of drones and the management of satellite data; which allowed me to start my own business.
When it comes to evoking his passion for robotics, William Elong said that:
“It’s like asking someone who loves the piano where his passion for the piano comes from. Sincerely, I do not know. The environment maybe, because I had a lot of chances to be interested very early in everything related to robotics. It was done alone. I would say its innate.“
The well-nourished passion allowed Elong to embark on entrepreneurship as early as 2015. To make his ambition happen, he created Will & Brothers, a startup specialized in economic intelligence and specialized technological innovation; then Drone Africa to realize his dream of developing drones 100% Cameroonian.
“Apart from the Startup Will and Brothers, there is another named Algo Drone which was originally called Drone Africa. It has become a company present in several countries. So we set up an office in Germany, which allowed us to reach Europe and not just focus on Africa, because we think the global market is large, “he said.
Thanks to the creation of these two structures, William Elong finally realized his dream of developing the Drone Africa app: launching the first civilian drone service in Cameroon. This innovation earned him a place as one of the most formidable African geniuses. In 2016, he was among the top 30 most promising young African entrepreneurs, in a ranking published by the famous American magazine Forbes.
“Drone Africa is a team work made up of young engineers recruited from some of the Faculties of Industrial Engineering in Douala and others in Yaounde. It is gets a lot of self-learning through lessons available on Youtube and Open Source. From this workforce and our skills, we have embarked on a production phase. We also knew a lot of failures, but we got up and today our service offer is functional, “he said.
The drone surveillance service offered by William Elong is increasingly adopted in various sectors of activity in Cameroon, particularly in agriculture, tourism, communication, meteorology, defense or mapping.
“More than 80% of our activity is carried out with institutional actors. For example, farmers who want to do mapping on several hectares with the drone. Others solicit us for the promotion of tourist sites. We have covered sites of some stages of the African Cup of Nations in Cameroon. I can mention the Olembe stadium, which we shot during the construction. We also have clients in Congo or Senegal. In Africa the solicitations are going well, “he said.
Concerning the components of his devices, the promoter however specified that all the parts are not manufactured in Cameroon.
“I am often asked if the components of my drones are made in Cameroon. No, of course. Even when you buy your phone made in France all components are not manufactured in France. We have components that come from different suppliers around the world and sometimes assembly is done in Cameroon. The important point is the know-how that we sell to our customers, “he reassured.
”The size of the market and the scale of the needs in Africa are elements that have attracted our first funders”
But William Elong is also an ace of crowdfunding. To succeed in these different challenges, Will & Brothers was able to mobilize $ 200,000 from various investors at the launch of his project. In January 2019, the young entrepreneur managed to raise 2 million euros (1.3 billion CFA francs) of funds announced in early 2018. Funds that come mainly from foreign investors even if William would have liked more involvement of Cameroonian partners
“I submitted my project to investment funds that could be interested in our sector of activity. It works pretty well. Unfortunately, we have very few local investors. Too bad. The size of the market and the scale of the needs in Africa are elements that have attracted our first funders and still attracting today, “he told Sputnik
Among the difficulties encountered by the young entrepreneur in the development of his drone and artificial intelligence services is the newness of this technology in Cameroon.
“Given that we are specialized in a high-tech sector like artificial intelligence and drones, the general public has a hard time really understanding what we are doing. To fight against this basic incomprehension, we organize information and awareness workshops to demystify the subject. Because of the technical complexity, we are often faced with misinformation. Each time, we have to go back over certain points to better enlighten them and make them understand,’’he said.
With this local experience, William Elong is now eyeing the international sky.
“We are actively preparing for the conquest of the international market with our drones. However, there are other areas of activity that we are aiming to explore. I can speak in particular about Finetech, it is an area that interests us particularly, cybersecurity especially. Because there is only one step between drones, data transmission and cybersecurity issues, “he said.
Besides his many activities, this geek also works to share his experience with young people in Cameroon.
“We accompany young people to encourage them to start their own businesses. In this sense we have set up an association called “Cameroon Flying Lab”, an association that promotes robotics among young people through actions in schools, universities and others. I can also talk about the “Phoenix Lab” a non-profit organization based in Douala that offers support to young entrepreneurs who are looking for capital, “he said.
As he continues his rise to conquer the international market, William Elong firmly believes that artificial intelligence can contribute to the digital transformation of Africa and its development.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
Glovo now exists in Kenya, Morocco and Cote d’Ivoire, with plans to expand to Ghana, Nigeria, and Tanzania. The startup which was co-founded by the 26-year-old Barcelona -based Oscar Pierre in 2015 has raised over $340 million since it was founded and is already displacing major players in the crowded delivery industry.
Here Are Quick Facts About Glovo:
Barcelona-based Glovo is the on-demand delivery app that allows customers to order anything — restaurant meals, groceries, flowers — from more than 1,000 participating businesses and have it delivered in less than one hour.
Simply put, the startup is known as the “anything” delivery app.
Glovo makes profit by charging a service fee, plus a commission on their partners, depending on the cost of the product or item.
The most interesting fact about Glovo may be that despite being founded only about 4 years ago in 2015, the company already has a presence in 178 cities across 23 countries.
The startup’s vision is to be a lifestyle app with all urban services available easily through its smartphone application.
Food delivery service remains its most popular service. Other services available on the app include Groceries, Pharmacy, Desserts, Courier, and Quiero (anything).
While most companies are very focused on food only, Glovo can, however, deliver everything.
The food business allows users to find and place orders with their favorite restaurants which is picked up when ready and delivered to the user’s doorstep. Today, more than 85% of Glovo’s orders in Europe are for food.
Unlike the other couriers — namely the UK-based Deliveroo and US-based UberEats — Glovo couriers don’t just pick up food for customers of the app. They’ll also buy them a particular dress in a size 12 from Zara, or grab some painkillers from a pharmacy if the customers so request.
While this model continues to be its flagship service, the company is reportedly experimenting with CloudKitchens and Grocery Darkstores.
In fact, the startup has become so successful that Bloomberg said Glovo could now be worth €650 million ($730 million)
The firm’s revenue jumped from €18 million ($20 million) in 2017 to €81 million ($91 million) last year.
Over 200 key players are defining the Barcelona startup tech ecosystem
‘‘We…Found Our Gap’’
Glovo is not the first delivery app out there. Oscar knew this. In fact, at the time of starting up Glovo, there was already the US firm Postmates (which inspired him) that delivers anything a city-dweller might need or want, as well as Uber and Amazon’s Deliveroo that do similar things. This means the startup is already in direct competition with those companies. Thus, it is rather surprising that Glovo would make such quick success.
‘‘It makes the market more difficult,’’ Oscar told Spanish online magazine Viaempressa. ‘‘We have found our gap; we are the only platform in Europe that supplies the user with anything in the city, and I think that this is the key; the offer is broad. It doesn’t scare us that the competitors are large, being small is a competitive advantage because it means we can react quickly to these monsters. They are very powerful, but they move slowly. A clear example is our partnership with McDonald’s, for which we competed against Uber Eats and Deliveroo. We got it because we were the quickest to come up with a model that McDonald’s needed, it is specific for them on a technological and logistical level. When you are a startup, you bargain more easily.’’
Pierre also said there are many differences between Glovo and other national or international startups.
‘‘Our freelancers will buy for you whatever you want,’’ he said . ‘‘Another major difference is that our service is based on immediacy. We have a totally different model compared to other apps dedicated exclusively to transport people or deliver food. In addition, we are not a logistics company, nor do we want to be. These companies are only dedicated to collect and deliver while we put a whole city open to anyone.’’
Getting The Timing Right is Crucial
Getting into a crowded market could be easy but staying successful would remain the toughest game startups will face. Oscar Pierre, however, said getting the timing right is crucial. Glovo doesn’t come on board a country where there are already two dominant players (which is the case in Mexico, Colombia, and the UK), he said.
‘If we went to the UK today it would be super tough or impossible to become one of the main food delivery companies. It’s a snowball effect; as you don’t have the volume, you don’t reach to the top chains or restaurants which doesn’t give you the growth,’ Oscar told Sifted, a new FT-backed website that launched early 2019.
Again, the startup succeeded in Spain mostly because it brought big brands such as McDonald’s and KFC onto its app and this led to ‘massive growth’. Before then, competitors like Deliveroo refused to meet the big companies’ demands. This was an opportunity Glovo held onto. ‘‘We literally built anything they wanted,’ Pierre said.
Today, Glovo is the biggest food delivery service in Spain (where it is profitable and takes around one million orders per month)
Oscar said: ‘Every single city needs between six to nine months to reach operational break-even. Structure-wise, it’s been super interesting You have to delocalize — otherwise the company stops. You need to find super strong regional teams. In Buenos Aires, Argentina, we have a very senior team, with almost a CEO and CMO, and they take all of the decisions.’’
‘‘We pitched to 118 funds, and all of them said ‘no.’ ’’
Oscar said building the startup did not come without a fight. He said the startup pitched to 118 funds before its current progress.
“For our series B round, we pitched to 118 funds, and all of them said ‘no.’ We were very close to going bankrupt, maybe a month away. All our competitors were huge. Two years ago, there was no way to convince investors that we’d really be competing face-to-face with Uber Eats or Deliveroo. There was very little conviction about food delivery back then.
Being from Barcelona was always very tough because when you only operate in Spain, you don’t have access to the VCs in London or in France. The Spanish ecosystem of VCs is very small and very risk-averse,” he said.
In 2017, Glovo raised $30 million in a series B funding round led by the Japanese tech giant Rakuten. Rakuten ended up being a company with a famous connection to Barcelona that came to Glovo’s aid.
‘‘One day, Rakuten came out of the blue and decided to invest in us,” Pierre said.
Since then, two other funding rounds have followed, the latest of which, totaling 150 million euros, or $170 million, was led by the early Spotify investor, Lakestar, in April, 2019 taking the startup’s total funding to $340 million.
Glovo renders delivery services for anything the city has to offer and is learning, growing and improving fast.
Remembering those periods in the startup’s story, Pierre said he didn’t know if he were doing a rational thing then.
‘I have to say, I don’t know if it was a very rational investment at that moment — when you have over 100 smart investors saying no, it might mean something,’ he said.
Oscar said the most important factor that has guaranteed the startup’s continuous growth is its quest to remain profitable.
‘‘Only those who focus on profitability get funding,” he said. “We make sure we are not only growing, but that the cities are not in negative numbers for many months. We know there are cities that need only six months to show losses and others, 12 months, because it all depends on size; but we know that sooner or later we will get good numbers. In Spain we have seen more than 10 proposals similar to ours and many of them have failed. The margins are small and if you do not look after them well, it will not work,’’ he said.
Focusing on profitability has helped the startup to steer clear of loss. In 2016 Pierre said the startup obtained 1.1 million net euros in profit, which represents the commissions from their partners and shops along with what the user paid for the service, and that meant tenfold growth. In 2017, barely two years and two months old, the startup took a millionth order. The number has since doubled.
‘When a sector is overfunded…investors disappear’
Pierre said the urge for startups to get funded almost always comes with a price — a sudden disappearance of investors.
‘‘Delivery is a complicated sector. Between 2010 and 2012, there was overfunding in Barcelona. It was new and grew quickly because it clearly had value. A lot of projects were funded that began to close down in 2014 and that went on for another couple of years. That was just the moment when we began looking for funding. The investors saw that the sector was in fashion, but that it had problems. And what happens when a sector is over-funded is that the investors disappear,’’ he said.
The Best Way To Confront Fund-Raising
Pierre said the best way to confront fund-raising is by being humble.
‘Our most important core value is humbleness. I tell it to the team a lot. I’ve seen companies burst because of lack of humbleness,’ he said.
‘Every time I go to the board, I’m like, “Oscar man, if you’re not taking big steps you’re not going to be the best CEO for this company.” So I just keep that in my mind all the time.’
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
The 3rd Women in Africa Annual Summit which took place on Marrakech from June 27th and 28th, 2019, attracted delegates from over 80 countries with a mandate to African women to rise to the need to take a leading role in defining how they want to develop business with the rest of the world.
According to Hafsat Abiola, President of Women In Africa, “together we are and we will change the centuries’ old story of Africa through the magic of women from all part of Africa, from Asia, the Middle East, and America and from the few men who have understood that we are changing Africa for the greater good of all of us”.
The ‘greater good’ was symbolized by the exceptional presence of Alaa Salah, the 22-year-old Sudanese student, now known throughout the world as the Lady Liberty of Sudan after she spoke up in a demonstration demanding the installation of a democratic and civilian government in her country. As she did last April, she reminded the audience the poem she read, standing fearless on top of a car: “It is not the bullet that kills; What kills is the silence of people.”
The 550 women and men leaders, representing the economic, governmental, cultural and civil society from more than 80 countries never kept silent during the Women In Africa third annual summit and the parallel WIA54 program dedicated to laureate women entrepreneurs coming from every African country but one.
Under the High Patronage of his Majesty King Mohammed VI, the Women in Africa annual conference welcomed for the first-time official delegations from the United States, the Middle East, and Asia. Together, they worked on the theme: “How African Women Engage the World and Create a New Paradigm.”
“If you get the right people together and get them engaged on subjects, great things happen,” said the Kuwaiti Princess Intisar Al Sabah who attended the conference along with a delegation from her home country. “From the opening speech, the whole subject was: ‘let us collaborate for a better Africa and a better world.’ This set everyone’s mood to engage and collaborate with one another.”
Three specific sessions addressed how Africa can revisit its business relationships with America, Asia, and Europe. “We have to stop thinking ‘charity’ when we talk about women of Africa,” said Aude de Thuin founder of Women in Africa and of the Women’s Forum for the Economy & Society. “The only message is, ‘women in the economy are at the same level as men,'” de Thuin added.
If Africa has done a lot of work in terms of empowering its population to be able to scale up and create a wealthy continent, there remains a gap in how the rest of the world understands the kind of development Africa is going through.
The presence of Africa and of African women in the media around the world appeared to be one of the two key paths toward creating a new paradigm. As American television anchor and lawyer Star Jones explained, it is urgent that Africa and especially African women write their own narrative. “In other words, you do not want to allow the news media to dictate how the world sees you,” Jones said. “You write your own narrative and you tell the world who you are.” “Africa is capable of producing its own images and telling its own stories,” added Denise Epoté, Regional Director for TV5 in Africa. The other path to a new paradigm is to take the lead of professional investment prospection in Asia, beyond India and China through a demanding process that includes transparency and positive social impact.
Acknowledging the growing diversity of African-Asian economic exchange, delegates agreed that Europeans need to revisit their own business relationships with African countries and corporations to remain competitive.
The new African paradigm was also implemented at Women in Africa by the 53 women entrepreneur laureates of WIA54 2019, an initiative launched by WIA Philanthropy Foundation and aimed at high-potential African women entrepreneurs who are creating tomorrow’s Africa. They all participated in a two-day series of training workshops to guide them on the fundamentals of a startup at the crucial moments of its development.
“Africa is the only region in the world where more women than men choose an entrepreneurial career, a reality that underscores the work of Women in Africa Philanthropy, which we are proud to sponsor for the second consecutive year,” said Société Générale CEO Frédéric Oudéa in the closing of the summit. “Opening a field of possibilities to the feminine dynamic will have a certain impact on the future of the African continent.”
“The 53 Women Entrepreneurs represent every country of Africa but Eritrea,” explained its program manager Seynabou Thiam. “They were selected among 1,800 applicants, which confirms the force of women entrepreneurship in Africa,” Thiam explained.
“These young women entrepreneurs represent the future of not only their countries but the future of Africa and the world,” said WIA54 Godmother Ann Walker Marchant, founder of The Walker Marchant Group in Washington D.C. and a former White House Special Assistant to President Bill Clinton. “They are innovative, creative and fierce. They are breaking glass ceilings and changing the perception of business in Africa. These fresh faces are the future.”
Seven of the 53 WIA54 2019 were also honored and their projects distinguished on seven different themes during a ceremony that started and concluded with a spontaneous enthusiastic and emotional party:
* Ley Zoussi (Republic of Congo) in agriculture for Complete Farmer and her community agriculture platform; * Gladys Nelly Kimani (Kenya) on digital for Class Teacher Network and her application that digitizes the school path; * Fadzayi Chiwandire (South Africa) in education for DIV: A Initiative, her NGO that teaches young girls how to code; * Ehiaghe Aigiomawu (Nigeria) in fintech, for Vesicash and her instant escrow technology; * Corine Maurice Ouattara (Ivory Coast) in health, for her Mousso Health Pass, the digital medical record on connected bracelets; * Mariam Sherif (Egypt) in the environment, for Reform Studio, her eco-friendly design products; * Grace Camara (Sierra Leone) for social innovation, with RemitFund, which transforms the African diaspora funds’ transfers into social investments.
Roland Berger and Women In Africa published on this occasion their third study on African Women Entrepreneurs. Although Africa has more women entrepreneurs than any of the other continents (24% of women are entrepreneurs), African businesswomen could make their startup companies more sustainable and profitable if access to professional training, support, telecommunications, and banking structures were developed.
Other personalities such as Awa Ndiaye Seck (UN Women), Cathia Lawson Hall (Société Générale), Viviane Onano (Leading Light Initiative), Swaady Martin (Yswara), Alyse Nelson (President of Vital Voices), Rokia Traoré (singer-songwriter and cultural entrepreneur), Aïssata Diakité (Zabaan Holding), Francine Ntoumi, Oby Ezekwesili (#BringBackOurGirls) and Veronica Colondam (YCAB Foundation) participated in conversations that spanned from financial inclusion, women in science, arts & culture, the impact of climate change, development of women’s leadership, investing in the new generation of young digital innovators, facilitating women’s access to finance and agriculture markets, corruption and, gender among others.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.
Being in business is one, remaining in business is another. Startups who follow the one-dimensional approach to revenue generation may soon find themselves stuck halfway into the business. Of course, the revenue streams may remain stable in the first few years of the business, but in most cases, revenues from a particular line may just hit the rock bottom. To some extent, diversification may just be a way of relaunching and innovating.
How Big Is The Deal That Decades-Old Companies Are Choosing Diversification Strategy Instead?
Starbucks
Quite unexpected, Starbucks took to the media to announce it was no longer retaining coffee-making as its sole business driver, and for which it had been known for more than 43 years coffee. In addition to the coffee, the company had rolled out a chain of products from its brand-building strategy centered on portfolio diversification. The products featured juice, tea, baked goods, foods and more. One expert, Jason Moser, a senior analyst with Motley Fool One, a finance solutions advisory service, said the diversification was the best bargain Starbucks could ever get.
Moser said diversification is serving Starbucks well and has even brought the brand back to its former glory, undoing the financial troubles it faced less than a decade ago when Schultz stepped down from his position as CEO. At that time, the company’s strategy revolved heavily around growth at the unit level.
“There was a joke about Starbucks stores being opened in the bathrooms of Starbucks stores. It felt like at that point the growth story had played out,” Moser says. “What it took was getting Howard Schultz back on board to lead the way, focusing on trimming the fat of the operation, becoming more operationally sound, honing the supply chain, and diversifying the menu by offering more items.”
These positive financial trends span back across the past few years and coincide with the diversification strategy that allowed Starbucks to bounce back after the financial troubles it faced in the mid-to-late 2000s.
While diversification added extra pecks to Starbucks’ earnings, it furthered opened up the decades-old company for profitability.
Is Diversification for Startups Necessary?
Dj Vallauri is the Founder and CEO of Lodging Interactive, a New Jersey-based global digital marketing, and social media engagement agency, who ] first launched hospitality-focused digital marketing agency after spending nearly 25 years in the hotel sales and marketing business. The business became so successful that 90% of his revenue base came from one customer.
‘‘While it’s easier said than done, the idea “don’t put all your eggs in one basket” definitely holds true in business,’’ he said. ‘‘ It’s just too risky and too irresponsible for any entrepreneur to operate in this manner.’’
He narrated why he had taken the route of diversification.
‘‘Within just two weeks, I was fortunate enough to land a whale of a customer as my first client. This client was in growth mode and would take us with them every step of the way up. The business started small enough for us to handle and grew organically, as we also grew organically. Life was good then; this one customer generated nearly 90% of our revenue. But deep down, every time they gave us more business, I had a sinking feeling that the hole I was in was getting deeper with every new dollar this customer spent with us. The fear, of course, is that your one large customer files for bankruptcy and goes out — taking you out with them,’’ he said.
Ways Startups Can Diversify
New Products And Services Development
One way startups can diversify is by investing in product research and development. Doing so will open the possibilities of extra revenue generation for the startup.
‘‘Invest in research and development, and create new products and services that will present new revenue generation opportunities for your company. R&D is not just for large consumer brands; even small startups need to focus on this area. And no significant budgets are required; when you’re starting your business, you don’t have a lot of cash for R&D. Start by creating a SWOT analysis and a mind map to get you started in the thinking process,’’ Vallauri said.
Acquire New Customers
Acquiring new customers is the best way of steering away from a poorly performing business model. Asking questions on customer acquisitions for your startup is the best way of staying ahead of the game.
‘‘Be in constant sales mode. Increase all your sales efforts by 10 times,’’ Vallauri said. ‘‘Look at your fixed costs, such as your personnel. Can your company take on more business without having to hire new people? If the answer is yes, you’re halfway through your diversification efforts. You are already paying your team members to handle your current customer base, which is what I call the “sunk costs” of doing business. So if you can add more customers without having to add more people, this means you can aggressively price your services to win the business, thus giving you an edge towards your diversification process.’’
Vallauri said the more you can diversify your agency business, the better you would sleep.
‘‘My agency now has two operational divisions to ensure our business and revenue diversification. One division is dedicated to traditional digital marketing agency services and the other is dedicated to more emerging marketing practices related to reputation management and social media marketing. Should any one area of the business become commoditized, we have the ability to leverage our other service offerings. Today, my digital agency is fully diversified and can weather any storm. And as a result, I’m sleeping very well,’’ he said.
‘‘Never forget to preserve the core while stimulating evolutionary progress. Keep in mind that evolution involves both variation and selection….selection involves two set of key questions,’’ writes Jim Collins, author of Built To Last. ‘‘The first is simply pragmatic: does it work? But as important is the second question: Does it fit with our core ideology? The variation… must be useful new, useful and reliable…in order to stand a good chance of being selected.’’
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
Fish accounts for more than one-fifth of the protein intake of African south of the Sahara and provides a livelihood to millions of people.
Africa’s small-scale fisheries play a critical role in global food security and must be supported with greater research and investment, say international and African experts. Industry, NGO, government and academic representatives attended Murdoch University’s second Blue Economy Symposium in Tunis last week as part of the Africa Blue Economy Forum (ABEF) 2019 and Murdoch University’s Third Commission, a research investigation focusing on issues of public concern to Africa. Fish accounts for more than one-fifth of the protein intake of African south of the Sahara and provides a livelihood to millions of people.
Murdoch University Adjunct Professor, Dr. Jeremy Prince, who attended the symposium and is contributing to the work the Third Commission in this area, said the collective value of the small scale fisheries of Africa was too big to ignore. “It is critical that we stabilize and rebuild these fisheries to ensure both food security and the future of the blue economy,” Dr. Prince said. “The time to act is now.”
Discussions at the Tunis symposium provided useful insights and contributions to the fine-tuning of the focus and narrative of the Blue Economy chapter of the Third Commission’s report. A strong emphasis was placed on the need to highlight clear and innovative actions to effect a lasting transformation of the blue economy in Africa. Participants in the symposium called on all nations and international institutions to recognize the value and economic impact of small-scale fisheries in Africa.
Their recommendations included increasing investment to allow fishing communities to be more involved in the co-management of fisheries; directly engaging with fishing communities to collect and share relevant data regarding the state and economic value of small-scale coastal fisheries.
In keeping with Murdoch University’s commitment to quality research and teaching in public policy at both the national and international levels, Murdoch Commissions are exercises in applied public policy informed by rigorous scholarly research and analytical thinking. They bring together senior practitioners, international experts and thought leaders from Australia and around the world to work on pressing problems and issues of public concern.
The first Murdoch Commission, “Western Australia and the evolving regional order: challenges and opportunities” published its final report in November 2013 and the second Murdoch Commission, “Food security, trade, and partnerships: Towards resilient regional food systems in Asia” released its report in December 2015.
Murdoch’s Third Commission commenced in June of 2018 and is focused on six themes firmly rooted in the agenda for action identified by the Africa Progress Panel (APP) as being in need of more significant research attention, bolder policy innovation, faster implementation on the ground, enhanced political leadership and the conceptualisation and roll out of innovative research solutions.
These themes are Promoting Equity in the Extractive Industries: Managing the Extractives Industry in a more equitable, transformative and sustainable; Boosting the Blue Economy: Better Monitoring, Governing and Harnessing of the Blue Economy; Promoting Sustainable Agriculture and Food Production: Enhancing Sustainable Farming and Food Production and Nutritional Security; Increasing Power and Light: Creating greater and more innovative access to Modern Energy (Electricity and Light) Fast; and Cross-cutting themes of Women & Youth and Climate Change.
An overarching focus of the Third Commission is identifying small scale policy interventions that have the potential to make big impacts. Additionally, it seeks to enhance Murdoch University’s links with Africa in areas of the university’s comparative advantage, including research and innovation expertise, strategic interest and networking capabilities within Australia, in Africa and globally. The Third Commission report is due to be published in 2020.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.
The dialogue centered on the notion that the development of the terrestrial network is key to growing the digital economies of all African countries.
Experts at the 2019 ‘Africa Panel Session’ of the International Telecoms Week (ITW), held recently in Atlanta, USA discussed the importance of infrastructure investments in local internet exchanges and terrestrial networks as being instrumental to facilitating the development and growth of Africa’s digital economy.
Presenting on the theme “Enabling Africa’s Digital Economy”, Principal Analyst at TeleGeography, Patrick Christian, evaluated the African digital economy, noting that the study of global trends show Africa maintaining its position as the fastest growing region in internet usage through data volumes remain shockingly lower than other parts of the world.
Mr.Christian, underscored the importance of the role content providers such as Google, Microsoft, and Facebook, play in driving Internet traffic and the expectation that their traffic on the continent will increase with the growth of Africa’s digital economy. It is expected that having more content beginning to reside and be exchanged within Africa, will add tremendous benefits to the ecosystem.
A panel that included high-level representation from MainOne, Google, Avanti Plc, Angola Cables, CSquared Africa, and WIOCC engaged in compelling discourse that highlighted these and other key factors for development in Africa’s digital economy. The dialogue centered on the notion that the development of the terrestrial network is key to growing the digital economies of all African countries.
A point further emphasized by MainOne’s CEO, Funke Opeke, who stated that the organization is currently working in Lagos State of Nigeria to enable digital transformation through the deployment of 2500km of fibre across the State, adding to the almost 1000km of fibre currently deployed.
Opeke stated, “Our immediate focus is to ensure we have fibre to the towers, fiber to schools, health care facilities, and other government agencies, fiber to the enterprise/business districts, and with a density to reach within 1km of the majority of citizens in Lagos. We envisage having network density whereby over 60% of the population is within 1km of fibre access with the planned deployment.”
The 2019 Africa Panel session at ITW co-sponsored by MainOne continues to provide a platform for key global players to share perspectives on the opportunities and challenges of telecoms development on the African continent. This year makes it the 8th time in a row that MainOne has sponsored the session.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.
The growth of e-commerce has already transformed the retail landscape and with double-digit annual growth predicted into the next decade
Canon, world-leader in imaging solutions, deciphers the importance of the settings and ambiences of physical shops as they become more than just a buying space, an opportunity for the brand to build and maintain relationships with its customers. We know that customers are becoming more and more demanding and that is why brands must be able to quickly develop their concept and this adaptability is made possible thanks to digital printing.
The growth of e-commerce has already transformed the retail landscape and with double-digit annual growth predicted into the next decade, this disruptive force shows no signs of abating. Yet although almost a third of consumers report shopping in-store less often, just under 90% of worldwide retail sales still take place in physical stores, reflecting their enduring appeal for both retailers and consumers.
For retailers, physical stores play a role in sales 79% of the time and excel at converting interest to sales and increasing the value. For consumers, shopping in-store provides things digital cannot; the atmosphere, face-to-face customer service and the ability to see and try products.
From the perspective of the consumer, shopping is about customer experience, not channels. This is why the movement of consumer spending from bricks-and-mortar retail to e-commerce doesn’t mean the end of physical retail. In fact, it is driving the transformation of physical retail into an immersive experience and opening opportunities for specialty print service providers (PSPs).
The new role of physical retail
Most retailers that continue to thrive are those embracing ‘omni-channel’ strategies; focusing on delivering a seamless customer experience across every channel where they have a presence – physical stores, catalogues, e-commerce, mobile, social media and more.
In this omni-channel scenario, physical and digital touchpoints must complement one another to deliver a unified journey. This, combined with customer expectation of greater personalization and preference for experiences over things, is driving a fundamental change in the role of the physical store. Clever retail brands capitalize on their stores’ ability to engage shoppers with the emotional and multi-sensory experiences that are missing from online purchases.
For design professionals and service providers active in retail décor, physical retail’s new role represents an exciting opportunity to create spaces where customers want to spend time.
From functional store to immersive brand experience
‘Retailtainment’ and ‘the experience economy’ are concepts that originated almost three decades ago but have only really begun to transform the retail landscape in the last 10 years. With retailers increasingly competing on the basis of ‘time well spent’ instead of just product or service offering, the retail landscape is moving towards showroom-style environments that encourage consumers to experience products or stores in which cafés, events or workshops invite shoppers to linger.
Cycling brand Rapha, for example, calls its 22 stores around the world ‘clubhouses’. They are cafés that screen live cycling, have programmes of events and rides and also sell the brand’s high-end cycling clothes and accessories. Italian food brand Eataly’s stores provide a space in which people can eat, shop and learn about Italian food, combining groceries and kitchenware with a café, restaurant and cooking school in more than 20 stores globally.
The vital role of décor in an immersive retail
Delivering both atmosphere and sensory appeal, interior décor is an essential consideration when creating an immersive experience that encourages consumers to spend time as well as money in-store. 59% of shoppers want an inviting ambience in-store and 51% of consumers are more likely to buy from brands whose stores are ‘interesting or different’, rising to 63% for consumers aged 18-34.
Driving footfall
Retailers seeking to stimulate repeat visits from consumers and attract new clientele need to refresh store environments regularly to make them visually enticing, keep up with changing fashion trends and maintain the surprise factor to encourage footfall. The flipside is that tired retail interiors can quickly turn off consumers and send them to competitors.
Encouraging dwell time
The décor of physical stores and pop-up retail spaces is becoming an important part of the customer journey. In addition to ensuring that shopping in-store is visually consistent with every other touchpoint where customers interact with a brand, décor has an unparalleled ability to create a welcoming ambience and make a space a pleasant place to spend time. Indeed, unless a brand specifically wants to lead with convenience, the best store designs are those that make consumers want to stay.
This is why we’re increasingly seeing décor being used more to create a branded experience and encourage dwell time than to directly drive sales. If you look at children’s clothing retail, examples run from a life-sized doll’s house in French brand, Bonpoint’s, children’s store to a playground that runs through the displays in Spanish brand, SuperMoments’, Valencia shop. In both these examples, retail décor is simultaneously creating an experience reflecting the ‘personality’ of the brands, and encouraging consumers to spend more time in the brand environment.
Enabling connected experiences
Almost half of the consumers’ inspiration for purchases today comes from social media, but its power is even greater when you consider that the most persuasive source of information for shoppers is recommendations from family and friends – that’s who make up most consumers’ social networks! So it’s no surprise that retailers are trying to engage shoppers on social media while in-store.
Mobile-empowered shoppers are taking more photographs in-store, so retailers are incorporating design features that encourage social sharing – from purpose-built selfie opportunity areas to ‘shareworthy’ fitting rooms. London department store Selfridges, for example, promotes “selfie sticks and Instagram-worthy backdrops” in the fitting rooms of its third-floor Designer Studio. This phenomenon also demands that interiors are regularly updated and kept looking fresh.
The opportunity for print
Retailers need pragmatic solutions that can create a particular ambience or reflect what is ‘trending’, but with minimal disruption and waste and often within tight budget constraints.
This plays to the strengths of digital print in terms of flexibility, turnaround time, cost-effectiveness and sheer diversity of materials. In turn, this creates exciting opportunities for PSPs, whether they come to retail décor from a background producing retail display graphics or bring décor expertise from other segments such as hospitality.
With contemporary media, digital print and finishing technology, PSPs can offer a diverse range of creative and functional retail décor applications from bespoke branded wallpaper and creative pop-up displays and features, to comprehensive retail refits comprising wall coverings, window and floor graphics, and branded surface décor on counter tops, changing room doors and so on.
The PSP’s ability to realize the retail brand owner’s creative vision and ensure that the décor elements can withstand the physical stresses of the retail environment should mean that customized printed décor is a key element in creating more welcoming, immersive and captivating in-store experiences
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.
Consider the case of human travel agents who were once consulted before trips bookings to foreign countries were made before digital disruption set in. The information below would serve as a guide for further analyses.
Data from Statista showed declining sales growth among travel agents in the United States since 2011.
The above is a classic case of how far digital disruption can go. An ABTA Holiday Habits Report 2018, which tracked British holidaymakers’ booking behaviour in the last 12 months and their attitudes to planning and booking holidays in the 12 months ahead, found that 81% of people booked their holiday online, compared to 22% of younger ( mostly 8–24-year-olds) and older families who booked their holiday in store.
This suggests a shift towards booking online and the gradual elimination of the use of human agents to schedule overseas travels. Simply put, the migration of the business of travel agency online and the increasing power of customers indicates that people are:
Now more knowledgeable about travel;
Now more technology savvy and have better access to devices;
Now get attracted by offers too lucrative to refuse;
Are offered more choice than ever.
Price is more transparent than ever.
Indeed, the above digital disruption in the business of travel agency could be extended to those of:
Tax accounting where software such as TurboTax has eliminated tens of thousands of jobs previously available for tax accountants.
Newspaper publication which has seen their circulation numbers decline steadily, replaced by online media and blogs.
Traditional taxi drivers and livery companies have completely been decimated by digital players such as Uber, Lyft, Bolt and other car and bike sharing apps.
Airbnb and HomeAway are doing the same for the hotel and motel industry.
Jobs previously done by bus and truck drivers, taxi drivers and chauffeurs are gradually being taken over by driverless cars, such as those being developed by Google (GOOG).
3D printing is continuously proving a threat to the manufacturing industry where the technology is becoming better and faster and in a few years, maybe deplored to manufacture a wide variety of goods on demand and at home. This will diminish the importance of logistics and inventory management.
Radio DJs are largely a thing of the past. Software now chooses most of the music played, inserts ads, and even reads the news.
Farmers and ranchers previously made up over 50% of the U.S. workforce. Today less than 2.5% are employed in this sector. Yet, more food than ever is being produced in America due to the automation in agriculture and food production.
Rapid and disruptive change is coming to your business, regardless of the industry in which you operate
75% of today’s leading brands will be gone inside a decade.
The table above shows the top 10 US companies ten years ago versus today, ranked by market value (market capitalization) in US dollars.
Getting ready for disruption would be the best thing that can happen to small businesses. Here are a few ways to stay alert:
Agility Will Allow Small Businesses To Survive
The best way to stay ahead of digital disruption is to stay agile. For a business to be agile means that it can move quickly, decisively, and effectively in anticipating, initiating, and taking advantage of change.
A Global Study of Current Trends and Future Possibilities 2006–2016 found that the best way of adapting to change is to develop organizations that are both agile and resilient. The report found that higher performing businesses tended to take a more proactive and opportunistic approach toward change.
‘‘…The average tenure of companies on the Standard & Poor’s 500 in 1958 was 61 years. That decreased to 25 years in 1980 and is just 18 years now, a number forecasted to dwindle to 14 years in 2026.What does this decreased lifespan portend for business?,’’ says Sasha Viasasha, content strategist based in Chicago. ‘‘Such a shortened lifespan points to the changing nature of business itself. The business cycle has shortened, and the accelerating pace of innovation — and competition — is disrupting the old linear model of business and replacing it with new, dynamic model. Today, agility rather than longevity is winning. In fact, characteristics that once contributed to corporate longevity and denoted a healthy culture, such as the ability to ‘stay the course,’ now could utterly sink a company.’’
Consider the five stages of a business lifespan, says Sasha:
Seed and development — ideation, feasibility and fundraising
Startup — product development, market testing, and iteration
Growth and Establishment — improved cash flow, established customer base and brand identity
Expansion — expanded offerings and new markets
Maturity and exit — every idea or product reaches a crisis stage, a point where improvement plateaus, expansion is no longer possible, and profits reach a ceiling.
Now there needs to be added a sixth stage:
Rebirth or return — in this stage, a company starts over again, reinvesting its resources in new innovation, she says.
Rahul Varshneya, co-founder of Arkenea, custom software development services for founder-led companies says the trick is to lean into technology rather than become consumed with fear, like forward-minded entrepreneurs in specific industries who love, not loathe, technological advance.
‘‘It’s time for you to get down and dirty and really investigate the demographics of your target audiences,’’ he says. ‘‘Find out what they want, what they need, where they’re getting assistance and how you can help them. By creating a psychographic chart for each of your prospective consumers, you can get a truer view of their personalities, attitudes, lifestyles, interests and so much more. Then, you can use this outline to make wiser predictions about their buying behaviors.’’
Innovate And Adapt To Technological Changes
The best way small businesses can also survive in the face of digital disruption is to innovate. Dr. John Kotter, a world-renowned change and leadership expert prefers small businesses to create a dual-operating structure that combines the best of both worlds.
‘‘Ultimately, great companies execute and disrupt at the same time. Often they disrupt themselves…Truly great companies like Apple, Google, Amazon, and Starbucks constantly find new ways to become relevant to us and remain an essential part of our lives. When analyzed closely, you can see that they are simultaneously executing and innovating. If there is not enough innovation, changes do not occur quickly enough, your people can lose their passion, your products can become outdated — and worse, your business can become irrelevant. Great leaders maintain the balance between achieving results today and innovating to seize new opportunities in the future. So if you want to avoid disruption — or even lead disruption — then you need to greatly accelerate the way you operate internally to keep pace with a rapidly changing world,’’ says Randy Ottinger an Executive Vice President at Kotter International and Professor of Leadership, Emeritus, at Harvard Business School.
The best way to adapt to this disruption, according to Robert Glazer, founder, and CEO of a global performance marketing agency, Acceleration Partners, is to put technology and data to work.
‘‘No matter what industry you try to disrupt or in what way you to try to do it, data and technology can be a huge help,’’ he says. ‘‘Technology doesn’t just revolutionize businesses, it changes how consumers behave in every aspect of their lives. If you track the market and note where interest in new technology is heaviest, you can likely foresee what areas are most ripe for disruption.’’
The most basic advice on adapting for small businesses would be to:
Small businesses can also hop on the frenzy of social media advertising. According to Ewan Duncan and Eric Hazan in their article, Digital Disruption: Six Consumer Trends, “Social networking represents almost a quarter of all Internet time (up 10 percentage points since 2008) and reaches over 75 percent of all Internet users.”
‘‘With more than 70% of Australians now using smartphones, and more than 40% of them making purchases directly from it, according to Our Mobile Planet, you’re missing out on a huge slice of the pie if you’re in e-commerce and operating without a mobile friendly site,’’ says Kwasi
Collaborative Partnership For Innovation
Small businesses can also survive technological disruption if they can partner with industries within their sectors, and where possible with the disruptors.
‘‘Companies that are better prepared for industry disruption are much more engaged in growing and broadening their ecosystem partnerships,’’ notes the Accenture Institute for High Performance. “They actively use this strategy to support innovation and research and development, as compared to only half of those who admit they are less prepared. Companies that are disruption-ready are a third more likely to partner with advertising agencies, innovation companies (26 percent more likely), design service providers (24 percent more likely) and even customers (26 percent more likely). They are also 36 percent more likely to collaborate with companies beyond their traditional industry boundaries, and 32 percent more likely to align with companies they consider direct competitors.’’
“In order to successfully navigate industry convergence and strengthen their network of alliances to build truly collaborative operating models, they must shift their mindset to compete as a ‘cluster’, not as a single company, creating shared value for their alliance partners and customers.”
Accenture Institute also goes to recommend tips for surviving disruption as follows:
Do not face digital disruption alone. Deepen and broaden partnerships with customers, providers, and a diverse array of companies in and beyond your core industry
Make yourself indispensable. Use your business’s focus and expertise to become a critical part of the integrated solutions that customers demand
Embrace operational flexibility. Consider what business changes you will need to be more collaborative and open — both in terms of your processes and your employee mind-sets
Develop New Customer Segments.
Small businesses can also confront digital disruption by developing new customer segments, instead of just defending existing business lines through cost cutting, automation, or service improvements for existing customers.
Medialaan NV As An Instance
Medialaan NV, a leading free-to-air video broadcaster in Belgium, found out that there had been a shift in video consumption by youngsters to platforms such as Netflix or YouTube. In a bold response, Medialaan bought Mobile Vikings, a mobile virtual operator with attractive data plans.
The strategy: Transform itself into the leading online social video platform for Flemish teenagers. Medialaan not only has diversified its revenue base to include data plans but also has been able to reengage with a lost segment — the teens — and now advertises its television programs to them more effectively. It is one of the few traditional broadcast companies to grow its TV audience in the youth segment.
Start Off New Business Models.
‘‘Innovative companies are experimenting with business models intended to disrupt their own legacy strategies,’’ Jacques Bughin and Nicolas van Zeebroeck in MIT Sloan Management Review said. They gave an instance of how earlier this century, Schibsted Media Group of Oslo, Norway, observed something that most media companies saw in their newspaper businesses: Print classified advertising was beginning to dry up. Rather than sit idly and witness the erosion of one of its most important revenue streams, Schibsted pulled the rug right out from under its own feet by moving its entire classified business to a free online marketplace. Today, more than 80% of the group’s earnings come from commissions on sales from its consumer e-commerce platform.
Commonwealth Bank of Australia (CBA) as an example.
Jacques Bughin and Nicolas van Zeebroek noted that when digital disruption started threatening CBA’s payment services business, Commonwealth Bank of Australia (CBA) confronted the disrupters once and for all. The bank moved from focusing exclusively on payment services to developing its Pi, an open payments platform that hosts an ecosystem of applications and devices for merchants.
The platform is open to third-party developers, and the bank developed for itself an Android-based point-of-sales terminal called Albert, which is fully integrated with the Pi payments platform. Equipped with a card reader and an integrated printer, Albert can be extended with dedicated apps, enabling it to do much more than process payments. Among the first adopters was Earthling Investments Pty. Ltd. of North Adelaide, South Australia, owner of wholesale fuel distributor Mogas Regional Pty. Ltd., also based in North Adelaide.
The company is using Albert at its fuel stations to process customer transactions, manage their payments, and receive sales data faster.11 Although the platform and its ecosystem contribute to the disruption of the traditional banking value chain, it also positions CBA to compete with digital entrants.
Similarly, while the mortgage side of the banking business is being disrupted by online search and home-financing platforms, CBA updated its digital value chain through an augmented-reality app that gives customers the ability to read a property’s sales history and community information by pointing their iPhone camera at the residence.
When they have found a property that they wish to buy, users can then file a loan application directly in the app, thus positioning CBA strongly against digital and incumbent competitors alike.
The Bottom Line
Imagine the hard work that comes with running a business, the burnt energy and the spent time, all guzzled up by fast-paced disruptive technologies? Although the general advice has always been that when businesses are faced with disruptive innovation the best and the most common-sensical things to do are to try and hold on to an existing market by doing the same thing better, or try to capture new markets by embracing new business models and technologies, a lot of businesses have gone into extinction due to a sudden ambush by mind-boggling, disruptive technologies. Only small businesses who understand these disruptions and can disrupt them could stand a chance to win.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.
