2016 Is The Year Digital Advertising In Kenya Will Reach A Tipping Point
The growth of digital and social media is opening business opportunities in the areas of eCommerce, digital media and entertainment, digital marketing training and digital advertising in Kenya. What does the growth of internet and mobile users mean for businesses in Kenya? My analysis of the digital landscape in Kenya for the last five years shows that mobile and Internet penetration is changing the way people send money, how they communicate, how they consume news and how they shop.
The latest data (as at September 2015) from Communications Authority of Kenya (CA Kenya) paints a clear picture of where to expect exponential growth in business:
- Kenya has 37.8 million mobile users- a penetration of 88.1%
- Kenya has 31.9 million Internet/data users, a penetration of 74.2%. 21.5 million -99 per cent of the total Internet subscriptions in Kenya use mobile devices.
- Broadband subscriptions is at 6.35 million
- Terrestrial wireless data/internet subscriptions is at 13,221
- Mobile money users in Kenya is at 28.7 million
- Mobile money agents in Kenya is at 135,724
The Emergence of Alternative Digital Media Outlets
The drop in profits in 2015 by the leading media houses in Kenya – The Standard and Daily Nation is attributed to the growth of digital media news outlets and digital migration – the switch from analogue signal to Digital TV broadcasting. Among the new digital media news platforms include: Tuko, Dhahabu, Techweez, Kahawatungu, Niaje, Techmoran to mention but a few. As a result, Standard and MediaMax fired a huge number of employees last year as they tried to streamline operations and reduce staffing costs. The message here is that media houses must create better user experiences in how they deliver news on various platforms- SMS, mobile, desktops and APPs. Tech-savvy Kenyans who are always connected online are now chatting and sharing news more than they’re reading hard copies of newspapers or even watching Television. WhatsApp and Twitter have become popular platforms where breaking news spread first and fast.
Growth for Digital Marketing Training in Kenya
This year, I foresee a growing demand for digital advertising services in Kenya as marketing professionals seek knowledge on how to advertise their products and services more efficiently on digital platforms. This means more marketers will be enrolling for digital marketing courses this year than they did last year. Some of the leading institutions providing digital marketing courses include:
- Centonomy (where I’m a lecturer): They provide Digital Marketing course as part of the Entrepreneurship course that takes 11 weeks
- NetBlue Africa
- BrandSchool (where I’m a lecturer)- The South African Institution which uses Digital Marketing Institute (DMI)- the world’s Digital Marketing curriculum which is formulated by the leading digital brands, including Twitter, Facebook, Google, LinkedIn, Microsoft, IBM, Vodafone, Communicorp, Dentsu Aegis Network, Omnicom, WPP and Ogilvy.
Opportunities in Digital Advertising in Kenya
Digital will eat into Kenya’s entertainment and media industry which was valued at US$1.8 billion or Ksh.191 billion (in 2014) according to Price Waterhouse Coopers (PwC). I predict an increase in Advertising spends in 2016 by brands. This will see an increase in the number of Digital Advertising Agencies in Kenya. Here is a list of some of the digital agencies in Kenya
- Digital for Africa Ltd (where I’m CEO and founder)
- Squad Digital
- Bean Interactive
- Brand2D Kenya
- ARK Africa
- Belva Digital
Opportunities in Mobile Money
On the money transfer side, Safaricom’s market share has been eaten by Equitel (owned by Equity bank) which grew by 24.3% in the third quarter of 2015 to record 1,085,869 mobile money subscribers. M-Pesa grew by 3.7% to record 22,127,622 mobile money subscribers while Mobikash grew by 2.3% to record 1,754,117 mobile money subscribers. Both Orange and Airtel dropped by 0.6% and 0.2% respectively. I’m very excited by the growth of money-lending platforms like Digital SACCO and KCB-Mpesa– a service that allows Safaricom users to borrow money via their mobile phones at very affordable interest rates. Could Digital SACCO be the innovation that will disrupt SACCOs in Kenya? Digital Sacco launched operations in October last year and had by end of one month signed up 10,000 members with Sh10 million in member contributions. The SACCO industry in Kenya is evolving yet regulation and supervision has remained in old days. This is a huge opportunity for growth. Michael Kimani, an e-money systems and bitcoin analysts told me that KBA- the banking lobby in Kenya holds back SACCO potential. He also suggests that SACCOs should look at blockchain, get their own payment system and ‘banking network’ in order to gain independence.
2016 will be the year when digital media advertising in Kenya will reach a tipping point. Brands and small businesses in Kenya will substantially invest on digital platforms and people will consume and share more digital content than ever before. I haven’t delved into the opportunities of eCommerce business in Kenya- I will do this in my next article.
Francis Waithaka – Founder of Digital4Africa
Write to me – [email protected]