Safaricom is gearing up to launch an online shop to retail a number of its products, including cellphones in what will certainly disrupt the retail market in Kenya. The company is already piloting the online mall, branded SafMall, internally before it rolls it out.
It is not clear if the mobile services company will sell consumer goods and other products apart from mobile phone-related items, but it’s entry will have far-reaching repercussions first on existing online malls like Jumia and Kilimall and on the ubiquitous offline mobile-phone related businesses. Many of them will lose customers and eventually run out of business.
SafMall will ruin the party for other e-commerce players like e-bay, Kaymu, Rupu and electrohub, which deal in various products including electronics, fashion and household. Kilimall and Jumia, for in stance, thrive on smart phones and electronic appliances, which is likely to be Safaricom’s main target.
In the lead-up to Valentine’s, Safaricom had started testing the new e-commerce platform with Flash sales of smartphones.
“We are currently in trials for an exciting new e-commerce proposition which is currently being piloted by staff internally ahead of rollout,” Safaricom said on its Twitter account.
The fact that products under the pilot were only phones has lead market observers to believe that SafMall will focus more on phones, which are some of the fastest moving items in the market today. This will be a blow to Jumia and Kilimall whose businesses are anchored on smartphones and electronics, mostly from Chinese manufacturers.
See Also >> Bob Collymore talks about the future of Safaricom
According to figures from Jumia, over 60 percent of online sales entail smartphones, which points to the fact that this category is the main source of revenues for these so-called online shopping malls. Being huge and influential in the market, Safaricom can work with manufacturers to provide highly discounted products and push other retailers out of the market.
In a recent interview Safaricom CEO Bob Collymore said that the company is not stopping at telecommunication services only but is prepared to disrupt the status quo in other business sectors. “We don’t want to become a company for everything,” he said, “we want to become a platform for everything. And in fact, we’ve even moved on from using the word platform. We now use the word raft because platform is something which sits still. A raft is something which moves. And the world that we’re in today is moving at a particularly rapid pace.
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SafMall will be an improvement of the Safaricom online shop. In terms of marketing Safaricom enjoys close to 70% of mobile service market share, which makes it easy to market the new shop. Also, Safaricom enjoys partnerships with leading mobile phone manufacturers like Samsung, Huawei, Wiko, LG and Techno to give ridiculous discounts including purchasing phones using loyalty points (Bonga points). In addition, payment will be easier through Lipa Na M-Pesa
For delivery, Safaricom has partnered with Sendy, a door-to-door, delivery and transportation services company. This seals the head crusher to the existing e-commerce players which may send them home.
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