I would say competition is hotting up in some of the most unlikely markets in Nigeria. The year 2012 has witnessed a dramatic change and these markets are becoming more exciting. Let’s take a look at 2 markets in Nigeria – the onlne retail market (Jumia vs. Konga) and the music distribution market (Spinlet vs. iROKING vs. Deezer)
The online retail market.
Ever since the
exit of Naspers-based, Kalahari.com from Nigeria in 2011, most people felt that Nigeria was not ripe for ecommerce.
Naspers painted a gloomy picture and I daresay I felt Investors were scared of investing in a country with all the unfavourable indices such as low Card awareness and use for commerce, fear of internet based businesses by the Nigerian people and even lack of the right infrastructure for ecommerce. But
Sim Shagaya and the
Samwer Brothers didn’t think so. They must have seen the increase in the middle class income earners, the growing population (160 million approx..) the large youth population, as baits too appetizing to let go off. The Samwer Brothers entered the Nigerian market in June 2012 with their international vehicle “
Rocket Internet” to launch two ecommerce site –
Kasuwa, then
Sabunta – an online fashion store. They then merged both brands into
Jumia. They then launched
Hellofood and then
Kaymu. All these were done within 5 months.
Sim Shagaya, already successful with his Groupon clone, Dealdey, also launched an online retail site – Konga.com in 2012. Konga is currently known for its high standard when it comes to fast delivery. It is known in the industry for being able to deliver goods within a couple of hours after the purchase online. It has also introduced a Loyalty reward system so as to retain and incentivize its loyal customers.
Recently Jumia received some funds from JPMorgan to assist in expansion of their business. It is expected that Konga would be in the market sourcing for funds too as it is also expanding at a fast pace too.So who will win?
Hmm… The Samwer Brothers has the experience of setting up ecommerce businesses globally while Sim knows the Nigerian environment. I think Rocket Internet has access to more cash compared to Konga. All things considered, I think Rocket Internet has an edge.
The Music streaming business
iROKING launched way back in December 2011 with the aim of redefining the music distribution business in Nigeria. It actually boasted of having already signed exclusive and hybrid digital distribution deals with popular music artists in Nigeria including Timaya, 2face, Bez, P Square, Bracket, Waje, Flavour, Faze, 9ice, 2Shotz, Kefee, Kween, Eva, Shank, Sunny Nneji, Sam Kleft, Sammie Okposo, and many more.
JasonNjoku, the CEO of
iROKO Partners (owners of
Nollywood Love and
iROKOtv), hopes to leverage on the success of these platforms. He has really done well with iROKOtv which he launched on the 2
nd of January and got over 500,000 registered users in under 6 months.
Spinlet launched in early May 2012 also aiming to get a piece of the pie in Nigeria. Under
Eric Idiahi’s leadership, it made a statement in June with its exclusive release of the debut EME all-stars album, Empire Mates State of Mind. It also sponsored Ice Prince’s collaboration with internationally acclaimed reggae artist Gyptian, and sponsored the appearances of 2face, Ice Prince, Naeto C and others at the globally famous SXSW music festival in Austin, Texas – a neck of the woods Eric is no doubt familiar with from his university days nearby in Houston. Under Eric’s leadership, Spinlet has also supported dozens of local Nigerian artists with the use of recording facilities and access to promotional opportunities.The Spinlet Musical app is currently available in BlackBerry, Android and Symbian and it will allows users worldwide to buy both local and international music right from their mobile devices.
Deezer came
into the Nigerian scene mid 2012. It is a French web-based music streaming service that allows users to listen to music on various devices online or offline. It currently has more than 20 million licensed tracks, over 30,000 radio channels and 22 million users (1.5 million subscribers). It currently offers Nigerian music on its platform from artists such as P-Square and 2 Face. With social integration, it shows what your friends on Facebook are listening to and allows you to recommend music to your friends on social platforms.
Deezer is still new in Nigeria and has not made any reasonable impact compared to the first two. But who knows what it has in store for 2013
So who will win?
Hmm…. this is a bit tricky but it is obviously between iROKING and Spinlet. But I will give it to iROKING based on its track record with iROKOtv. Jason also seems to be able to attract funds if he wants to and may not be scared by Eric Idiahi’s skills in raising funds based on his affiliation with Verod Capital.
Well, 2013 is still very young. Let’s watch and see what happens
What do you think?
