The idea of using coupons in Nigeria may seem foreign, but Oyihoma Saleh started Kosavadeals for Nigerian shoppers with the intent of helping them save money. As online markets keep expanding in Nigeria, kosavadeals is tapping into the market to provide end-users with access to coupons offered on retailers’ platforms.
Ventures Africa had a chat with Oyihoma Saleh, a tech enthusiast and the CEO of Kosavadeals about what his company represents and more specifically, the company’s win at the just concluded 2nd Venture Competition-Annual Wharton Africa Business Forum (WABF) which held at the University of Pennsylvania and the Loews Hotel, Philadelphia from 13 -15th November 2015. Saleh let us know that the term ‘kosava’ may look strange but is actually a coinage of the words – coupon, saving and savvy, which is basically what kosava represents.
Ventures Africa (VA): Kosavadeals emerged winner at the WABF annual venture competition, which has launched the company onto an international platform and given you access to networking opportunities with people interested in African entrepreneurship. What informed the setting up of kosavadeals?
Oyihoma Saleh (OS):Before Kosava we noticed that there was no reliable and easy way for Nigerian consumers to find out if retailers have a coupon or discount to help save money while shopping. This is due to retailers distributing these promotions using a variety of channels in an attempt to gain mass exposure but instead create a more complex discovery process for consumers. With Kosava we are bridging this gap by creating one reliable destination for consumers to find these offers. KosavaDeals.com is an online platform that connects shoppers to information on these promotions from top retailers in Nigeria. Our goal is to help Nigerian consumers save money by improving the ease and convenience in finding digital offers.
Even with the presence of such a service for Nigerian shoppers, it is rather surprising that several Nigerians still have no idea kosavadeals is available for them to make saving money on their purchases easier, this extends even to the wider African landscape. Kosavadeals which competed with other services like Memunatu (a magazine startup) and Zuvaa (African fashion startup) at WABF is still relatively unknown on the continent. Saleh told me what the company is doing to change this.
VA: Before now, Kosavadeals was not really known around Nigeria and the continent. What is your current coverage/reach in Nigeria and what is your company doing to improve that?
OS: The nature of our business is more about aggregating what is already available at online retail stores, so our best bet would be to work together closely with these retailers who can advertise our services to their own advantage. Our site provides shoppers the opportunity to potentially save at over 250 stores and we are now working on establishing closer relationships with retailers to grow the range of our coupon selection. We have spent the last 12 months building our product, developing our business model and working on operational processes for aggregating coupon offers. At this point, we are ready to introduce Kosava to Nigerian shoppers, giving them access to hundreds of coupons already on the site with many more being added every day.
VA: Tell me about your Wharton Africa Business Forum (WABF) win and what this means for Kosavadeals? How does the company intend to spend its $5000 prize money?
OS: Definitely, the win was an assurance boost, of sorts, which every business needs. As Kosava was one of four finalists selected to compete in the Venture Competition at this year’s Wharton Africa Business Forum, emerging the best shows that we are on the right track. The funds provided will be put towards our initiative to grow awareness of the Kosava brand and ensure Nigerian shoppers think of our company when looking to save money on a purchase. Most of our efforts in the near future will be focused primarily in Lagos.
The decision the company has to be well established in Lagos state is due to the fact that Lagos is basically the commercial hub of Nigeria. Further than that, the city hosts most of these retail businesses which are of major importance to Kosava. In order to build and sustain a smooth flow of collaboration with these businesses, kosava will have to operate within the same ground space as such businesses.
In my conversation with Saleh, he exuded positivity over the durability tendencies and acceptance of Kosava by the tech enthusiasts in Nigeria. He gave reasons for this – while testing the waters in Nigeria, over the last few months, spotlight pieces about the company were featured on major tech media spaces, TechCabal and Techpoint.ng. “This was a great way to get feedback from the tech community in Nigeria on our product and value proposition. The feedback overall was positive with many making the distinction between our offering and daily deal sites as well as being described as leading in a new space”, he says.
For those Nigerians who may argue that the use of coupons in Nigeria is certainly new ground, you are not totally wrong about that as Saleh confirms it, but he also statistically backs up the stand that the narrative on that is changing.
VA: I thought the use of coupons were not the norm in Nigeria, are there projections that show a change or growth in e-commerce that could influence the use of coupons in Nigeria?
OS: Using coupons has not been the norm in Nigeria but times are clearly changing. E-commerce was a concept that was once fathomed impractical but Nigeria has been marked as the largest e-commerce market in Africa in the space of only a few years. Nigeria’s failure to adopt a ‘couponing’ culture has been due to a number of reasons but definitely not because Nigerians do not like saving money. Frankly, the traditional approach of clipping paper coupons was not practiced due to the cost of print and distribution and this challenge still exists. With a number of foreign and indigenous retailers, both online and offline, flooding into the country to meet the needs of the largely underserved middle class, we have noticed a significant rise in the availability of digital offers. Most excitingly, studies suggest that Nigerians are very welcoming of these incentives.
Research conducted by PayPal revealed that lower costs are viewed as the third biggest driver of online shoppers to shop more, coming in behind faster delivery and safer ways to pay. Calculations from the figures mentioned in the same study suggest the addressable market for coupon offers conservatively stands at 10 million people, with the potential of rising to 14 million, as more people are expected to shop online in the near future. Also, the conditions in Nigeria seem to show strong signals that suggest the time for couponing is here. With global online coupon redemption projected to grow to 31 billion by 2019, experts believe that mobile phones will be the key driver of this growth and Nigeria’s large mobile usage highlights this opportunity. Furthermore, with the slowdown of the Nigerian economy, consumer spending is set to tighten meaning consumers will be looking for better ways to save on their shopping and couponing could not have come at a better time.
In terms of the current state of popularity of coupon use, it is growing very fast and you do not have to look too far to notice this. Take a look at the Black Friday frenzy sweeping the nation. An event that was only introduced back in 2013 by Jumia has been embraced year after year and in 2015 looks to be the biggest one yet. More interestingly it is not just online stores participating in this event but we see brick-and-mortar retailers getting in on the action, which only strengthens the claim that promotions remain a cornerstone of retail marketing strategies. For kosava, our place within these holiday seasons is to help shoppers take full advantage of the great deals that are out there. We want to provide an easy way for shoppers to always be in the know, whether they are looking for what promotions are on at their favorite stores or they are just looking to shop at retailers with the best deals. Kosava wants to be their ultimate shopping companion.
VA: How would you comment on the entrepreneurship narrative in Nigeria and on the continent of Africa?
OS: The internet revolution happening across Nigeria and Africa as a whole has presented a sizeable opportunity for entrepreneurs to come in and solve some of the day-to-day challenges consumers face. What is truly exciting is the opportunity mobile is creating for developing innovative ways of addressing challenges for this new generation of connected customers. At kosava, we are already looking at ways we can enable brands gain a stronger presence in the mobile moments of Nigerian shoppers by engaging with them at peak points of influence. The potential is vast and possibilities are endless.