DISPATCHLIVE / 07 JUNE 2018 - 14.12 / BARBARA HOLLANDS
Formal businesses ignore potential customers at the lower end of the financial spectrum at their peril and should adapt their strategies to accommodate them, according to marketing strategy guru and master entrepreneur GG Alcock, who will be addressing the Daily Dispatch Customer Innovation Summit on June 21.
The summit, which will be held at the East London International Convention Centre on the Esplanade and will feature presentations by seven thought leaders, follows last year’s Daily Dispatch Business Summit and will inspire the business community to better serve their client base and become more customer-centric.
Marketing strategy guru, master entrepreneur and author GG Alcock will speak at the Daily Dispatch Customer Innovation Summit about his theory of Kasinomics and tapping into informal economies
Alcock, who was famously raised as a Zulu boy in Zululand and whose early life was immersed in Zulu culture which he wrote about in his memoir Third World Child,said his contribution to the summit would revolve around his theory of Kasinomics, about which he has also written a book.
The word is a hybrid taken from the popular name for South African townships – eKasi or lokasie – and the vibrant business culture present there.
“My big focus is on the lower income section of the population or the traditional trade which is actually the dominant part of the population.
“Recent figures have shown that the footprint in shopping centres is dropping off because families only go there once a month. They dress up, eat out, draw money, buy ice-cream and make an experience of it, but the rest of the time they are buying from informal traders who are walking distance away.”
Alcock said immigrant traders in particular were “customer-centric” and some ran a credit book for groceries.
“They even help regular customers transport 12.5kg packs of maize meal and other heavy products home in wheelbarrows.”
However, he said enterprises like financial institutions and the motor industry often ignored the massive lower end of the market because they did not have payslips or bank accounts.
“There is an example of a man who went to buy a Jeep but was turned away because they didn’t believe that his business of selling kotas (a quarter loaf of bread stuffed with hot chips) was a viable business. Yet he had R500000 to pay for the car.”
Alcock said by ignoring potential customers from townships, business was competing for the same “formal slice” of the pie.
“We are all looking at the three or four million people who are employed because we haven’t adapted our business models for these [other] customers.
“For instance, many have vehicles but are reluctant to insure them because insurance policies don’t make sense to them and so no one is targeting them. Many don’t have bank accounts and others are reluctant to have debit orders.”
Alcock said a cellphone app called Tala exists in Kenya which lends money to people if they download it and record all their transactions for three months.
“This profiles their credit-worthiness and spending profile. The point is that in Kenya people are un-banked and don’t have those financial records. In South Africa we have a large un-banked population, but we are not adapting.”
LINK : https://www.dispatchlive.co.za/news/business/2018-06-07-change-of-tack-needed-to-pull-clients/
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