How do we make a business case for an innovative concept given the data scarcity for the African mass market?

Anzetse Were writes some thoughtful points on the challenges facing private sector innovation in Kenya, and Africa. Two of her points caught my attention, in particular:

With regards to the private sector, an interesting point raised is that innovation targeting it must have a business case for adoption otherwise the innovation won’t be absorbed. Innovation must demonstrate that the short-term inconvenience of adoption will pay off in the long term.
[…]
We have a real problem with information asymmetry and data bias. [… ] strategies for market penetration and sharing cannot be rolled out since the lack of data means the private sector doesn’t know where the market sits.

While Anzetse has specifically focused on the interface between the private and the public sector with regards to innovation, the points she brings up are nevertheless a challenge for either or both parties.

Size and value of the market opportunity for an innovation when data is scarce

Investors in innovation for new and untapped markets need the numbers to make sense of the opportunity. A dollar value and estimated size of the market are among the conventional metrics used to provide evidence of a return on their investment. How substantial is it?

In the African context, the mass market where the volumes can be found tends to be heavily biased towards the informal sectors, and still for the most part based on cash transactions. Textbook approaches to sizing and valuing the market space fall short without accessible and relevant data.

A few years ago, we were faced with a similar challenge for Village Telco, a social enterprise launching an innovative ICT device for low cost voice and data communication. They had developed the Mesh Potato, a device for providing low-cost telephony and Internet in areas where alternative access either doesn’t exist or is too expensive. It is a marriage of a low-cost wireless access point capable of running a mesh networking protocol with an Analog Telephony Adapter.

They were looking to enter the Kenyan market, with the notion that the cyber cafe industry would make the best target audience for their device. Their investors wanted to know the size and value of the market opportunity prior to launching the product in Kenya. Although this happened just over 6 years ago, Kenya had already made a name for itself as a forward looking mobile phone market unafraid of experimentation.

Our challenge was two-fold: We were to look at 2nd and 3rd tier towns, not just Nairobi and Mombasa. Village Telco was looking to connect the unconnected. And we had to estimate the size and value of the market opportunity for a sector – internet cafes – that was primarily cash based and informal, particularly given the rural and small town geography we were considering. There was little or no data available to even get a handle on the number of cyber cafes operating in Kenya.

Secondly, we had to get an idea of the price point at which the product would be acceptable to this target audience. Keep in mind that the device was wholly unknown – an innovation – and there was nothing comparable on the market.

A qualitative approach to quantitative estimation

Given that this was not a conventional research project, and time and resources were constrained to a market analysis, we designed a minimal viable market discovery phase that would permit us to gather enough insights directly from the cyber cafe operators in order to estimate the size and value, as well as recommendations for pricing and market entry.

In late 2011, Kenya’s administrative divisions were still the original provinces.

Based on population density and relative income demographics, as well as an ICT gap analysis of voice and data services – reports available through Kenyan government institutions – we planned an optimal route that maximized exposure to the types of locations Village Telco had specified whilst sampling cyber cafes across a range of infrastructure access and regional income. This coverage was completed in less than 3 weeks.

Surfacing trends through indepth open ended interviews

Where we invested our time and effort was in identifying entrepreneurial and innovative cyber cafe operators in the smaller towns and villages we visited. The vast majority of internet cafes are run as side businesses by the owners who might be white collar employees or civil servants, and often managed by employees. It was the cyber cafe owner operator who saw their business as a growth opportunity that we were seeking.They not only knew their market but had seen the opportunities to grow and expand their services.

They were able to give us an idea of the future of the cyber cafe business in their region, a rough estimate (few businesspeople are willing to openly share revenue data) of the scale of their business, and the trends in decline or growth of the types of services they offered.

Through the data gathered, we were able to estimate the high growth regions for internet cafe services – Nakuru town for instance had seen the number of cybers grow from 10 or 15 in 2007 to upwards of 50, primarily due the increase in tertiary education institutions. Kilifi, on the Coast, had seen a doubling when a local university campus opened.

At the same time, we were able to gauge the value of the opportunity space by using the proxy of the proportion of owner/operators to manager/employees – the former were more likely to be interested in the Mesh Potato than the latter.

Our route planning also provided evidence of the pathways for innovation diffusion, outwards in a hub and spoke model from the central hub of Nairobi’s business district where new electronic products landed from the manufacturing centers of Asia.

Sitting down face to face with the cafe owners and showing them the product and what it could do gave us the insight on pricing and market entry strategy. By the end of 5 weeks from start to finish, we were able to make a business case for innovation meant for a data scarce environment.

Innovation means breaking new ground

While the effort on the ground was very different from a conventional market analysis exercise due to the need to elicit information directly on the market and the product, the time and resources invested by the client were no different from an analysis based on secondary sources and accessible data flows.

The nature of the African mass market is such that pioneers entering the market will have to break new ground, not only with their products and services, but also their approach to analyzing and evaluating the business case for investment. It is not an impossible task and should not be considered a barrier to entry.

Household energy consumption behaviour in East Africa: Lighting & Conclusion (3 of 3 Parts)

Jua Kali Kerosene Lamp, Kenya

The following is extracted from a six month study during 2012 on household energy consumption behaviour in rural Kenya and Rwanda among the lower income demographic, that led to an understanding of some of barriers hampering the sales of client’s solar products in this market. This 3rd and final part will focus on fuel usage and consumption behaviours for lighting. Users sampled for this study were selected based on varying fuel consumption patterns, ranging from a single homestead to a rural hotel open from dawn to 1am offering solar powered football on television.

Fuel Choice and Consumption Behaviour is Influenced by Duration and Timing of the Need

Kerosene is the primary source of fuel for lighting for those who live without access to electricity, regardless of whether its on their shamba, or in a building in town. Not only is the reach of grid access limited to a small percentage of rural Kenyans but the cost of the final connection to the dwelling is also a barrier for many. Due to the nature of this project’s focus, the majority of homes visited were without a solar home system.

Hurricane lanterns are the most popular lighting devices among kerosene users, as the glass covering the lamp protects the flame as well as contains the smell and smoke. With prices as low as 250Kes, everyone has at least one, if not more at home and the number maintained depends on size of the family, number of buildings on the homestead and the fluctuating ability to purchase fuel.

Pressure lamps can cost ten times as much and consume far more fuel although they offer a brighter light – they were not seen in Makueni households and the only regular user was the furniture maker who restricted its use to times of high productivity during the Christmas season. In Kisii, they are owned by members of the congregation who use them once a month for religious functions and the fuel is provided by the church. Gregory the schoolteacher called them “gas guzzlers” whose bright light was not worth either the high running cost or price of the device itself.

Everyone owns a few small tin lamps but they were referred to as something discarded during the upwardly mobile climb to a hurricane lantern – “Oh, we must have a few lying about somewhere in a dusty corner” said one wife while Mama Grace only used it in the confines of the kitchen building where the open flame, with its attendant smoke would make no difference. However, due to their small size, they require very small amounts of kerosene and tend to be kept as a backup for times of need when the fuel supply runs low or to be used by the aged, such as Kilonzi’s grandmother who finds the hurricane lantern difficult to maintain.

In addition to kerosene fuelled lamps and lanterns, every home owned at least one flashlight of some sort, whether powered by dry cell batteries, grid rechargeable or disposable for what they referred to as “emergencies or needing to go outside at night”. By emergency, they meant that this form of light was faster and easier to turn for sudden need than the more complicated task of lighting a kerosene lamp, plus it could be used in wind or rain. For many, this item received first priority if resources such as batteries or cash for charging were limited.

What stood out across the board was that everyone knew, almost to the minute in some cases, exactly when they used their light source. This behaviour was evident regardless of the household’s energy source including if it was solar power and thus “free”. Answers would range in specificity from estimates “around 7pm to maybe 10pm, sometimes later” to on the dot timings “from 5.45am to 6.30am in the morning”.

“I only use it for children to study” Mama John who scrimped and saved for solar

This gives rise to the conjecture that the fundamental observation in household financial behaviour of being able to control time (duration, frequency, periodicity) and money(whether prepaid source of fuel like kerosene or postpaid like electricity), is an ingrained habit even after upward mobility has removed the need for such stringent conservation. SHS do not require the same frugality daily use and cost and this can be seen in increased use of entertainment appliances like televisions and radios but lights still follow this pattern. However, it can also be said that rural life is slow to change in response to the introduction of modern conveniences and this may also be a significant factor.

The dry cell battery

Similar patterns of duration and accuracy of timing were also observed in choice and purchase of dry cell batteries, particularly for the radio. People knew which specific programs they wanted to listen to thus the
time and duration of their use of the radio. Everyone wanted to be able to listen to the radio more often but conserved battery life for as long as possible. Many even acknowledged that expensive brands like Eveready which cost 65Kes a pair lasted three times as long as the cheaper Chinese Lion brand costing only 30kes the pair but their irregular cash flows acted as a barrier to purchase dependant as they were on what cash was available on hand (or in pocket) at time of need.

Concluding Remarks

Consumers with limited incomes prioritize household energy and fuel spending according to importance for survival. Food and thus cooking come first followed by light. Everything else depends on the criticality of need against funds available. For example, Muthoka, who was unemployed and living on his small subsistence farm deep in the interior away from a market town, said that if he had to choose between 20Kes worth of kerosene or charging his mobile phone, he would choose kerosene first for lighting was more important to him than his mobile.

Similarly, Gregory the schoolteacher, put batteries for the emergency flashlight as more important than for playing the radio. The question becomes “What can we do without?” and only one of the many respondents of the more general household survey prioritized her mobile phone over light but she was a business woman whose income depended on her being available for calls.

The caveat here is that these answers are not absolutes and while most people will say that the phone is less important, there will be times of need when charging the phone or topping up airtime will be critical.

However, unlike kerosene or dry cell batteries for light, one can always borrow a friend or neighbour’s phone for an emergency phone call. These are the kinds of trade-offs people make when living on the edge on limited and irregular cash flows.

Pricing is rarely the problem

These insights on people’s household energy management and purchasing patterns, based as they are on the limitations and timing of their income sources are what led to the conclusion that the actual price itself was not the barrier to sales but instead it was a combination of factors starting with the choice of packaging and the subsequent pricing and sales strategy.

Part One: Introduction to Household Energy Consumption Behaviour Study in East Africa (2012)
Part Two: Cooking

Estimating price in unexplored and untapped markets

In addition to estimating the size and value of the Kenyan cyber cafe industry for our client, Village Telco of Cape Town, South Africa, we were tasked with finding out what would people pay for their product, the Mesh Potato. This challenge was the equivalent of walking up to someone and asking:

How much would you pay for this thing you’ve never heard of and you’re not sure what it does?

We discovered it was through the long rambling conversations we were having with our selected cyber cafe owner operators that we were able to get to this point of being able ask such a question. The conversations allowed us a peek into the way they thought about investing in new technology, and in many ways, reflected back to us the basics of the “BoP” consumer mindset that had already been identified previously. For example:

Maximizing ROI (return on investment)

When asked what he’d pay for a Mesh Potato, our friend Moses responded with a question, “It depends, how much money will it make for me?”

That is, as a business owner, his evaluation of the product’s price was intrinsically linked to its ability to generate an income stream. Maximizing the return on the investment is his primary criteria – whether it will save him money or a significant amount of time, and how soon will that possible are all the factors that go into the decision to purchase. His question also implicitly holds the corollary premise of Minimizing Risk.

So rarely was the price seen in isolation but instead it was considered in context of a variety of other factors. For business owners, their primary value driver was “Is this a source of increased income for me?”

Another factor was that of the need to question assumptions underlying traditional models for assessing pricing – from wikipedia’s entry on the underlying assumptions used in Van Westendorp’s model:

The assumption underlying the Price Sensitivity Meter (PSM) is that respondents are capable of envisioning a pricing landscape and that price is an intrinsic measure of value or utility. Participants in a PSM exercise are asked to identify price points at which they can infer a particular value to the product or service under study. PSM claims to capture the extent to which a product has an inherent value denoted by price.

What if price is not the intrinsic measure of value or utility but long term revenue generation potential is?

Until we are able to gather enough insights over the course of a number of such studies and come up with frameworks customized for a very different operating environment, it will only be through the willingness to question all our assumptions and adjusting our approach that we will be able to make reasonably accurate assessments for these untapped markets.

Questioning the narrative of extreme affordability for mobile phones

Yesterday I had a long conversation with someone whose job is related closely to mobile phone design. You’d recognize his employer’s name very easily. He asked me about extremely affordable phones for the low income segment in emerging markets. Late in the year of 2012, I found myself hesitating before answering immediately with a resounding “Yes” to support the concept of low cost mobile phones for the BoP customer in India, Africa or wherever.

That was enough to make me reflect on why I hesitated. After all, wasn’t this the default aspirational outcome for these demanding customers?

It was, indeed. But the narrative has not yet caught up with the reality on the ground. For citations, lets go to Alexis Madrigal’s article on The Phone of 2022, where he mentions:

No one has tracked these market shifts better than Horace Dediu at Asymco. He’s documented what he calls “a tale of two disruptions,” one from above in Apple and one from below in cheap Chinese and Indian manufacturers. In just the last five years, Nokia, LG, and RIM have seen their market shares and profits collapse due to this pincer movement.

This disruption from below has changed the mobile phone landscape for the lower income segments everywhere. Suddenly, their aspirations are affordable and the trade offs they make are now between a cheap fake with all the trimmings and a more expensive brand with less features, not between a phone and no phone at all.

For branded manufacturers of mobile phones, going after this low cost segment simply does not make sense anymore. Their own cost structure will never support what a Bird or a Tecno is able to provide for quite the same price. The low end mobile phone market is now a commodity market, where even the repairmen tell you that people don’t bother to get their phones fixed anymore because a Chinese replacement is cheaper than the branded spare parts. Furthermore, mobiles are a personal asset and one worth saving up for – why not aspire to the best possible you can afford?

Thus you’ll find a taxi driver in Nairobi flashing his iPhone or the security guard with Blackberry curve. The “smart” aspect of the phone may not always have to do with the innards of the device.

Human beings are aspirational. This shift in the consumer’s perception and choice in response to the larger shifts as documented in the snippet above includes the reality of increased choice. Even 4 years ago, it was difficult for a poor farmer to contemplate the purchase of a mobile, seeming as it did a shiny shiny way outside his grasp. Today’s market forces have brought it home to him, well within his reach, as any beachboy surfing Facebook will inform you.

The old emerging market for mobile phones narrative is a dangerous one for the big global brands. The emerging stories are now the Tecno’s and the MicroMax’s. Yes, there is a lowest income bracket or those 2 remaining families without a phone, but that market has now spun out of reach. The digital divide is being bridged by names you’ve never heard of and the discards of those who’ve gone on ahead.

Far better to take a step back from the fray and think about where the dots are with regard to the mass majority markets of the world. The internet experience. The window to the wider world. The global social network. The aspirations that the commodities cannot fulfill as easily. Far, far better to offer a stairway up than a dumbing down. Nobody aspires to be the bottom of anything.

What price brand? No pretence about “fakes”

One of the most fascinating things that emerged from my immersion in the informal trade of China made consumer electronics in Kenya last month was the role played by “fakes”.

We assume that cheaper copies of well known brands attempt to fool the customers. Packaging and brand names echo the look and feel of the original as far as they are able and the entire exercise is one of “bait and switch”. In fact, this is not the case at all. Nobody is fooled and people know exactly what they are buying.

What is interesting, however, is how these “fakes” are sold.

Shopkeepers – whether the upcountry retailers catering to their local, rural customer base or the wholesalers back in the Central Business District dealing with rural stockists – offer you a choice. They display both the original brand, a genuine product of quality with warranties and whatnot, and the “fake” version, whose only guarantee is caveat emptor, and leave it up to you to assess your willingness to take a risk.

Their words often follow along the lines of “Here is the original Nokia, costing so much and doing this, this and this, while here is the China made product closely resembling the above but has these additional features and costs only so much”. Everyone is completely aware of the lifetime value of either product and the risk involved in ending up with a dud.

It is upto the customer to decide if they want to spend for durability and reliability and quality or make the tradeoff for a short term gain in features, upfront cost and the caveat of a short lifespan.

This approach seems to fit within the constraints of the informal economy’s cash flow volatility as well as the customer demographic’s mindset around brand value and product performance. No one that I spoke to, either at the wholesaler, the shopkeeper or the customer level, seemed to feel that the “fakes” were an attempt to defraud them in anyway.

Its a pragmatic approach to affordability and aspirational ownership.

How do you compete in a market where charity distorts pricing?

Strategy guru Michael Porter’s 5 forces framework is quite well known to anyone attempting to assess or analyze the landscape of an operating environment for an industry or organization. Increasingly, since I’ve begun working out of Sub Sahara I’ve been sensing the challenge of a 6th force – one that is overlooked when consumer markets are considered particularly in the mass majority demographic. It is insidious however and hinders the sustainable practice of commerce. It is the dominant logic of charity and aid which leads to free give aways by so many seeking to help a poor African out.

Lets take the example of solar power as given in this recent BBC article:

The end result is DIY solar kits that can recharge phones and batteries. They look makeshift but they have the potential to make a huge difference to people thousands of miles away in Kenya.

As the director of KnowYourPlanet, Mark Kragh’s day job is to resell solar panels to small businesses and hobbyists. But in February he will travel to Kenya to distribute specially-made kits he is giving away as charity, and to show local people how to make more.

What if someone decided to give away solar panels for free to the small businesses and hobbyists who make up Mr Kragh’s customer base? How do you suppose that generous act of charity would impact his business?

Similarly, whether its the jua kali inventor/maker customizing solar power installations for each of his clients or the many social enterprise ventures that dot the landscape, each in their own way are trying to earn a living even while the work that they do helps improve the quality of life for their customers.

On one hand we talk about growing sustainable businesses and nurturing entrepreneurs as a critical means of social and economic development – ‘development through enterprise‘ we say- yet on the other, these very same fledgling ventures will be blindsided by a market force that has the power to distort pricing and disable competition.

Where will the support come from for these companies to establish and grow marketing channels, distribution networks and a win win profitable solution for all stakeholders? The majority are local establishments who employ local people and thus add value to their communities.

Well meaning enthusiasts who come in with hand outs are going to have the same effect on the market as any competitor who practices ‘dumping’ – it will undercut the market and cripple any sales or marketing strategy if the alternate to purchasing a local product in a shop is a free giveaway from a charitable individual or organization. Furthermore, they are not a business to provide any after sales service or maintenance or customer support, their goal is to be in and out having done ‘good’ during a flying visit.But the aftermath will create enough ripples in the market creation process that companies will have to deal with for a long time afterwards.

Interestingly, Mr Kragh intends to visit Kenya – one of Sub Sahara’s most mature solar power markets instead of Senegal where he’d originally gotten his inspiration from. If I was part of the solar mobile charger and lantern manufacturers association in Kenya or even Nakumatt or the electrical supply shop cooperative or whichever relevant body, I’d say they should petition to put a stop to activities of this sort or send them along to a location who needs it more than they. After all, it is the season of giving rather than receiving and one must always help one’s neighbours.

Estimating price in unexplored and untapped markets

Mesh Potato by Village Telco, Mombasa, Kenya 12 Oct 2011

In addition to estimating the size and value of the Kenyan cyber cafe industry for our client, Village Telco of Cape Town, South Africa, we were tasked with finding out what would people pay for their product, the Mesh Potato. This challenge was the equivalent of walking up to someone and asking:

How much would you pay for this thing you’ve never heard of and you’re not sure what it does?

We discovered it was through the long rambling conversations we were having with our selected cyber cafe owner operators that we were able to get to this point of being able ask such a question. The conversations allowed us a peek into the way they thought about investing in new technology, and in many ways, reflected back to us the basics of the “BoP” consumer mindset that had already been identified previously. For example:

Maximizing ROI (return on investment)

When asked what he’d pay for a Mesh Potato, our friend Moses responded with a question, “It depends, how much money will it make for me?”

That is, as a business owner, his evaluation of the product’s price was intrinsically linked to its ability to generate an income stream. Maximizing the return on the investment is his primary criteria – whether it will save him money or a significant amount of time, and how soon will that possible are all the factors that go into the decision to purchase. His question also implicitly holds the corollary premise of Minimizing Risk.

So rarely was the price seen in isolation but instead it was considered in context of a variety of other factors. For business owners, their primary value driver was “Is this a source of increased income for me?”

Another factor was that of the need to question assumptions underlying traditional models for assessing pricing – from wikipedia’s entry on the underlying assumptions used in Van Westendorp’s model:

The assumption underlying the Price Sensitivity Meter (PSM) is that respondents are capable of envisioning a pricing landscape and that price is an intrinsic measure of value or utility. Participants in a PSM exercise are asked to identify price points at which they can infer a particular value to the product or service under study. PSM claims to capture the extent to which a product has an inherent value denoted by price.

What if price is not the intrinsic measure of value or utility but long term revenue generation potential is?

Until we are able to gather enough insights over the course of a number of such studies and come up with frameworks customized for a very different operating environment, it will only be through the willingness to question all our assumptions and adjusting our approach that we will be able to make reasonably accurate assessments for these untapped markets.

Pondering the sustainability of the cyber cafe industry and its future

Business is booming, Kilifi, Kenya 11th October 2011

Jomo, who runs a traditional cyber cafe in an office building near Mombasa’s busy port district, gave us a well framed and articulate argument on the challenge of running a sustainable business given the costs involved. His key point was that the internet providers, particularly the mobile operators now actively competing with conventional ISPs, were pricing their products to suit the end users rather than the ‘channel distributors’ of the service i.e. cyber cafes. They leave little or no margins for cyber cafes and his own business had shown a 25% decline in the past three years with no end in sight for the steady downward trend.

On one hand, low cost access to voice and data has been an undeniable boon to the majority of Kenyans who can now call a friend or relative in the US or India for just 3 Ksh (USD 3 cents) a minute from their regular prepaid account. Mobile broadband modems average 3000 Ksh and are a simple addition to small offices able to pick up refurbished desk top PCs for as little as USD 100. In Mombasa city and its environs, this affordable combination has made the biggest impact on the neighbourhood internet cafe – be it in a lower income residential/market area or in the Central Business District.

But on the other, as we drove outwards from the city into the smaller towns and markets, where the cyber business is still booming if not showing a growth trend in some places, listening to the stories around the challenge and cost of maintaining sufficient internet access for more than one single personal computer, I wondered if this pricing trend is necessarily a good thing in the grand scheme of things.

I’m not talking about increasing the cost of access to data but whether there shouldn’t be a seperate pricing plan for the cyber cafe industry as opposed to offering them the same data bundles and packages as any other SOHO customer. And why?

Right now there’s growth as increasing numbers of people go online at work or at home, with mobile phones or employer provided laptops and the future looks rosy for the industry as well as those who watch internet penetration in developing nations. But there will come a point after which there will be people for whom personal ownership or such employment will not be possible, nor make sense. For example, there are beach boys in Malindi who have been gifted with laptops by their tourist friends but continue coming to the cyber for their internet needs. Which beach shack is set up to support computer usage and does that investment in a mobile broadband modem actually make sense when so much assistance and support is required to navigate one’s way through the complexity that is the modern day OS and its software?

Once we sweep aside the veil of hordes of students going on Facebook with their phones, we see the need for egovernment services such as the KRA or even the convenience of booking bus tickets online. The cyber cafe’s role in enabling and supporting the accessibility to the world wide web, especially among the less educated or well off, is critical if these services are to reach everyone for whom they meant. If the cost and pricing of the services and devices are increasing customer usage and growth in the now, they imply a death knell for cyber cafes struggling to make ends meet.

Yet the cyber is a much needed element of the value chain – they are the informal support system for all this technology. Nearly all mentioned that daily customers would come in seeking assistance in setting up the internet on their mobile phones. Or needing help in setting up their Facebook accounts. This mobile revolution we talk about isn’t happening by itself, but it might end up killing the midwife.

Tradeoffs made in purchasing decisions influence product and marketing strategy

Kenya, June 2011

This snippet from the Business Daily caught my attention:

With the inflation rate at 15.93 per cent in the month of July, product sales have come under pressure as consumers put aside non-essential commodities like refreshment drinks from their budget lists.

“Right now, the market is very sensitive to price. Coke is competing with other consumables like airtime so consumers have to relate the money in their pockets with the products,”

It captures the essence of the real world challenges faced by lower income customers, especially those who manage on irregular cash flows viz.,

Every decision to spend money made by those who manage on uncertain incomes at the base of the pyramid can be said to be analogous to making a strategic investment decision. This needs to produce tangible value in their immediate future, in some way or the other. Whether the decision is a trade-off between purchasing shoes for a school-going child and meat for a meal, or choosing to buy some airtime instead of a meal, each of these is an investment—in the child’s future, in future income if work is dependent on being accessible by phone, or in simply ensuring the next meal is on the table ~ The 5Ds of BoP Marketing

As disposable incomes shrink, every product or service will need to justify its value to the increasingly demanding customer. Strategy planning begins by understanding this demographic, their mindset and values and how they manage their household incomes. Marketers and product managers cannot afford to assume that buyer behaviour will follow the patterns of mainstream consumer culture. The challenges in the local environment are too different.