This article was written for HBR a few months ago. Here are some key snippets:
Three distinct factors are driving this transformation. First and foremost is the desire for financial inclusion. Africa’s unbanked majority needs access to affordable tools for savings, loans, and credit. The second is the need to lower the costs and risk of retail and trade based primarily on cash transactions. The third is the introduction of cashless policies from regulators in countries like Nigeria, Kenya, and Ghana. Low consumer confidence in traditional financial institutions also makes this an opportune moment for new players to enter the solution space. And cellular technology is leading the way.
But the possibilities for ecommerce and consumer marketing are enormous. Nigeria’s ecommerce market alone generates $2 million worth of transactions per week, and online transactions are expected to cross $6 billion by the end of 2014. Interestingly, the fears regarding Ebola and Boko Haram are driving more people to shop online (and stay at home). E-tail could help consumer goods companies leapfrog the need for extensive distribution infrastructure, something consumer product companies are already exploring.