Is Sub – Saharan Africa ready for innovation?

My last blog was a teaser on what I believe makes the Sub Saharan africa ripe for investments today….the time tested and proven adage of “first mover advantage” will hold true here in this forgotten part of the world.

The likes of standard chartered bank, the unilevers, the cadburys, the nestles, the P&G of the world who have crossed the Rubicon and dared to invest in the economies of the sub – saharan geography will reap rich dividends (if they are already not doing so!) in times to come and they will become barriers to entry of others in their respective domain.

Surprisingly it wont be government policy that will pose barriers to entry into these promising markets, but the lack of foresight from potential investors and their inablility to bite the proverbial bullet!!

its time to act people…..

and while I am on the subject of investing in africa today….I am sure many of those at the highest decision making levels would still be wondering on whether their investments will offer returns in the long term?

they are right…

simply investing in these markets will not be enough…a well thought out strategy, supported by foresighted managers and leader will be key.

This begs a question….what sort of strategy would work here?

While we are all aware of the 4 different types of strategies; I am personally biased towards a strategy that will ride on the ability of the investor to have the capacity for executing disruptive innovation in product design and systems.

Let me explain…

across this region there are obvious common facets that are observed in these economies…be it Nigeria, Ghana, Togo, Benin, Cameroon…..the list goes on….all these economies fare poorly on the global governance index, lack basic infrastructure, are home to some of the largest number of poor in the world.

But the resilience of these “poor” consumer is note worthy and thats where the opportunity lies for the investor.

The investor will have to necessarily look at offering their brand of product and services at a price point where these “poor” consumers will be able to afford them….thats calls for a disruptive innovation thinking approach.

they will necesarily have to think out of the box in trying to develop optimum logistics to get their products and services at minimum cost to their target consumers- which calls for disruptive thinking.

while doing these, they will still have to be innovative in financing their operations such that they target maximising their revenues at the least possible cost-again it will take a different mind set, an innovative creative mind to develop a buisiness plan based on these stringent parameters.

off course this market is not for the faint hearted, but for those who seriously seek to challenge their managerial and thought leadership capabilities and believe in the capitalist model of “inclusive sustainable growth” without doing charity!!

based on what I have discussed in brief, I personally believe that a good entry strategy for these markets would be a mix of the leader, challenger and nicher variants, and certainly not the follower strategy.

as a leader , you will have to demonstrate courage of conviction in leading investments with your products and services into these markets, thereby challenging the others who are sitting on the fence, and target a niche market for your branded products and services…

Innovation will be key success driver…but we must ask ourselves…is Sub Saharan Africa ready for innovation?

I believe it is and there are many examples to support this claim…

the detergent market in Nigeria is one prime example…it is a mature market today and this maturity has taken place over the last 15 years at a rapid pace.

The first mover in the innovation game was Unilever who launched their OMO ddetergent in an SKU of 35g and differentiated their product from others by offering a “white” detergent as opposed to other offerings in the market, which were all “blue” detergent powder. The consumer across demographics was successsfully convinced of the “superior” performance of the “white detergent” versus that of the blue detergent through a brilliant marketing campaign. The packaging and the product differentiation disrupted the market and others had to follow suit…in the meantime, OMO became the category leader.
It took competitiors 10 years to catch up, and today one only has to look at the innovations being offered by the likes of EKO Resources (SO Klin detergent) to understand what the category is like in Nigeria.

So Klin detergent is offered in SKUs of 15g, 30g, 65g, 76g, 100g, 200g, 450g and 1 Kg…and it has recently launched detergent with Triclosan..anti bacterial properties in a detergent at the same price point as a normal detergent!!

despite this level of competition and communication clutter in the market, capacities are being added in this category…some of the largest are with RIVOC, PZ etc…..

in my next blog I would discuss whether the indian informal system of innovation “JUGAAD” would find takers in Sub Saharan africa….

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Sub Saharan Africa – the final frontier?

Good morning !
Even as i write, the chinese juggernaut continues to tread where few have dared…in Sub – Saharan Africa.

While we in the US ,Europe and even the BRI (Brazil, India, Russia) continue to debate …to invest or not to invest,…the pace of chinese investments in this part of the world continue at a fast pace.

So what are the chinese investing in?

what is clearly visible is investment in infrastructure projects…roads, railways, bridges etc….and now also in oil and gas (Sudan)

next question is …what do the chinese hope to leverage from these investments?

according to me the following
1. Geo political clout
2. access to sources of un explored and un exploited mineral wealth of this part of the world ,where no one wants to invest !
3. access to hydrocarbon energy sources
4. first mover competitive advantage for chinese consumer goods , technology, pharma companies- and converting this competitive advantage to a comparative advantage for the long term
5. exploiting the huge BOP (Bottom of pyramid) markets in this region, that comprises aspiring consumers who live in a cash driven economy.

Chinese products virtually run the informal “parallel” economies in the sub-saharan region and some of the growth that has been seen in these economies should definitely be attributed to the influx of chinese companies and chinese goods.

the debate is on whether chinese “investments” are good or bad for these markets, but the reality is that these investments have been made with a long term perspective and the chinese are here to stay.

question is that the cat (The sub – saharan markets ) has been belled (chinese investments are here!); who will have the courage of conviction to believe in the potential of the future cash flows from these markets and take the plunge?

isnt africa the final frontier for our investments?

Is Sub-Saharan Africa the last frontier?

Hi guys,
Im starting this blog with a view to build on my personal assessment about the latent potential laying unleveraged at the bottom of pyramid markets.

I have spent the last 8 years of my professional life as a business manager in Nigeria and in that time I have had the opportunity to travel across East africa as well…Tanzania, Kenya and Ethiopia.

But it was in West Africa, that I had the opportunity to observe the consumer up close and personal at the proverbial bottom of Pyramid (BOP)

I travelled extensively across Nigeria, Ghana, met people from Mali, Cameroun, Togo, Benin, Sierra Leone, Cote ‘d Ivore, Senegal and the sense I got from meeting these different peoples was this; despite their daily struggles with what many take for granted, their level of aspirations astounds me…
Millions of eager consumers in the Wets African BOP markets may be “dis-enfranchised” because of poor or non existent economic means to pay for their “aspirations”, but it fails to deter them in their quest to ultimately get to their goal, to consume a brand that they have so much aspired for!

As a marketing professional this ignited a curiousity in me and as a business manager of a start up I started to look at this “dis-enfranchised” demographic as a potential money spinner….I have not been disappointed!

I have come away from Africa , with the belief that after all the avenues have been exhausted by investors who play in the global marketplace, where Africa is not currently included at levels observed in other regions (BRICS), these investors will finally begin to see what I have seen in Africa and investments will come to this part of the world.
Sub – Saharan Africa will be the last frontier for all the major hedge funds, investment funds, Private equity funds, Venture capital funds and funds in a myriad different hues!!

How long can you not invest in a market where ROI are many TIMES that seen in the developed world!!

Good morning Boston ! Nov 13th

Hi guys,

The early rays of the sun are filtering into my room and as I drew away the curtains , I was splashed with the warming nurturing droplets of Ra the sun God!

Boston is beautiful when its not cold and raining……

you have to be here to see the leaves turn hues of ochre, yellows, some browns and mostly orange….the streets are littered with the dead dying leaves….a sign of change to come….ushering in a new season….a season of all prisitine whites.

although I dread the extreme cold, there is a part of me that is looking forward to experience the “real” winter…with loads of snowfall…snow on my window sill…..snow lining my walkway …from the porch to the gate and the side walk beyond…

and i want to experience what it is like to play with the soft white snow, make snow men, have snow fights….and celebrate a white christmas…

so heres to a new day…heres to promise of an even better one…heres to a new dawn and of new seasons to follow…

Good morning Botson!!

 

28 Maple avenue, off School Street , Somerville

hi there….my first blog and perhaps portend of things to come forth from my mind, my imagination , my observations of all things mundane and things that i consider special…
the title pertains to where I stay and will till the end of my academic life at HULT International Business School..aka (Arthur D’Little School of management)
It been almost 2 months since i arrived in Boston and felt what it was like to be in the land of opportunity ..the promised land of many across the globe….and this place , Botson, has not failed to surprise me everyday..
the weather for instance …such variations ..such extremes in one single day !
I have travelled extensively in India…I have travelled in Thailand…in Singapore….been to the Serengeti….driven across Nigeria…but have not seen weather like I have in Boston…
its bright in the morning and by afternoon it could be windy as hell and you could be soaking in rain by evening…..but have started to love this mercurial temperament of Boston weather…
our house on Maple avenue dates back to 1890s and has withstood the test of time….classic brick and wood construction….huge walk in closets…big enough to sleep in!
have made it home with as many comforts as possible with limited financial resources…its comfy ..cosy and a place to come back to ..
my window overlooks the street and across the street is the brazilian catholic church….wake up sundays to the sound of laughter and friendly excited chatter of the church goers…your old, teens , young adults…mums dads….beautiful people of all hues….yes this feels like home

Hello world!

Hi guys….wanted to take this opportunity to thank all of you who are part of my online communities and social circles.

Feels good to be here and to open out to the whole world full of very opinionated bright minds who have travelled all over and would be willing to share their experiences and perhaps learn some thing from what I have to share through this forum…

I am here to share and to learn from all of you out there and hope that this will be a journey that I will relish for a lifetime…

do write back….do share

If there is anything that i can do for you in a personal of professional capacity please do let me know…