Using data to understand the motivations behind consumer behaviour
BY CHABALA WALTER
Often the larger population works with the misplaced assumption that established and big brands such as Safaricom don’t really need to put in effort. That somehow, brand equity will do all the work for them; that they will just unleash a product and it will sell. Nothing could be further from the truth; if anything, such brands put in ten times the effort, invest ten times their resources and spend ten times more man hours on research, crunching numbers and making sense of the same just to make sure they continuously get it right. Well, seeing is believing; let’s see how Safaricom PLC got it right yet again.
Fuliza. It’s basically a mobile overdraft facility that enables consumers to proceed with their transactions even if they are short of money in their e-wallet. The service was launched in January 2019 and just like Mpesa, it has literally taken-on a life of its own. Picture this, Fuliza hit one million subscriptions within the first week, while its loan book hit KSh1 billion. Should I scratch that? I think I should. Fuliza hit one million subscriptions within the first week, while its loan book hit KSh1billion.
Big Data
Dr David Nersessian, a polished academician, a thought leader and a global economic think tank recently posited in one of his articles that digital information has overtaken oil as the world’s most valuable commodity. That “Big data technology is inherently global and borderless,” he said. With the empirical evidence from corporates such as Safaricom, the above statement is something worth thinking about.
According to Forbes contributing columnist Lisa Arthur, “Big data is a collection of data from traditional and digital sources inside and outside your company that represents a source for ongoing discovery and analysis.” I think amongst the myriad of definitions of Big Data, I like this one – simple and comprehensible.
Safaricom is home to 28,850,444 million prepaid customers, 1,093,197 million post-paid customers and a total of 29,943,641 million total customers as at September 2018. These numbers are according to data released by the Communications Authority of Kenya in their first quarter sector statistics report for the financial year 2018/2019. During the same period, the number of active mobile subscriptions in the country stood at 46.6 million. Therefore, Safaricom’s global market share stood at 64.2 per cent. I put these numbers out there so that we can make crisp sense of what we’re talking about. So, in their register, you and I and many more Kenyans have Safaricom as custodians of our varied data. Being tech-centric, these guys love data. Not just Safaricom, all tech players. What makes the difference however, is as Lisa puts it, how one uses that collection for ongoing discovery and analysis.
Within the same period (Jul-Sep 2018), Safaricom recorded a total of Ksh1, 585,729,101,317 (15.6 billion USD) as total Value of all Mpesa transactions. With this data and data collected over stretched periods, Safaricom invested in it. They put out their time, human and other resources to analyse all the data; I’m talking big data analytics here and this is what their research found. The findings showed that millions of transactions were being cancelled every day because of insufficient funds. And with all things good research, you don’t stop at the findings; you proceed to make sense of it. So Safaricom saw the need of “providing a facility that will enable that person to have that transaction completed” and boom! Fuliza was born to solve a specific consumer problem.
Through big data analytics, Safaricom was able to uncover hidden patterns, correlations and unearth other insights that bore the product that is Fuliza. Organisations today have big data but many either lack the capacity to harness, the knowledge of understanding what it is or some are just caught up in the matrix and are unable to extract value out of it. But worry not, this is a perfect local example where we can pick and learn from because this is the future. The future lies in the organisational capability of harnessing big data and using it to identify opportunities.
There’s a global hurricane catching momentum dubbed ‘hurricane Data Science’, that is the next frontier of service and product innovation. The earlier organisations get on with it, the better.
Consumer Behaviour
In their journey, Safaricom was intent on understanding the guy on the other end because that’s where the true magic lies. You can’t sell to me what I don’t need.
Remember Maslow’s hierarchy of needs? If not, let me share a short story. Back in 1969, while the rest of the world was partying, this guy was studying monkeys. He found something interesting with monkeys; monkeys always made sure they quenched their thirst before looking for shelter and they always ensured they had shelter before looking for love, friendship or companionship.
Moving on, he also took time and studied humans and similarly; humans cared less for love unless they felt secure, they were uninterested in control unless they felt respected by their peers. Long story short, that is how Maslow’s hierarchy of needs was born. A framework that has over the years been used by marketers to profile consumers’ and make meaning of their choices by understanding their motives, their influences, their cultural backgrounds, rationality, beliefs etc. It is basically a theory of human motivation.
Understanding consumer behaviour is a vital weapon in creating products that win the hearts and minds of consumers. It is what will separate the wheat from the chaff and most importantly build long-lasting Brand loyalty.
Whereas big data in this case was more concerned with the inside data, Fuliza, through their conscientious effort in seeking to understand consumer behaviour, gathered and clearly made sense of the outside data as well. In their pursuit of consumer insight, they sought to understand both the market needs and what the consumer wanted. In understanding this, one looks out for: the motives, desires, impulses and all other emotional, rational or cultural beliefs as an individual factor in the purchase decision process because again, this is where the magic lies.
Doing the right thing & Doing it right!
Listen to the boss Bob Collymore here. “For a customer, a delayed transaction translates to a lost opportunity or a missed deal. We believe this is why Fuliza has proved to be immensely popular with our customers. Our insight behind Fuliza was the fact that 58 per cent of transactions that failed due to insufficient funds were completed within two days. This showed that there was an un-met need where we could come in and help our customers complete their transactions, even if they lacked funds at the time.”
Safaricom’s appetite of continuously transforming lives through product innovation kept their fire burning and developing Fuliza was both doing the right thing and doing it right. Not just for Safaricom but for the two underwriting banks as well because for them, Fuliza offers an opportunity for customer acquisition and additional high-margin income streams as well; a win-win for all-the customer, the banks and Safaricom.
Big data, consumer behaviour and Safaricom’s good grasp of the two turned Fuliza into a giant but behold, the future beckons. To you Safaricom, your keen eye in picking out the disruption that’s taking place in the market has seen you traverse our territory like a Colossus. The next disruption is coming thick and fast from Goliaths’ just like yourselves, maybe even bigger than you. Google just recently launched its digital payment platform Gpay; Whatsapp recently did their Whatsapp Pay test runs in India and Facebook is already Libraing’ our spaces. Africa is a market of a billion+, what happens when the big boys come for their share of that pie here in Kenya?
Chabala Walter is a Sales, Marketing & Communications Professional and a Columnist at Marketing Africa. Email: chabalawalter@gmail.com
