$1 billion! 90,000 sq.ft! Tens of thousands of dollars! YNaija Investigates Jumia vs Konga (Conclusion)

by Adegoke Oyeniyi, for YNaija

On the first anniversaries of Nigeria’s leading (and feverishly competing) e-commerce companies, we go beyond the deluge of Google and Facebook adverts, and look at the character, future and people behind these attractive brands

Raphael-Afaedor-and-Tunde-Kehinde

[READ: Jumia vs Konga – Who is winning the war? YNaija Investigates the numbers, the hype, and the CEOs]

Since physical engagement is essential to persuading markets to respond to online retail, observers are convinced that Jumia’s ability to conquer the latter three markets easily accrues to more market share than its competitor.

The retailer, which started with a 12 sq.ft warehouse in Oregun, Lagos, has launched a 90,000 sq.ft storage facility to take in more inventory – and since size and reach cannot be ignored when it comes to the business of logistics. Jumia currently holds this prize. Also, with width of the Nigerian market, financial capacity is probably set to play the strongest role in the success of these companies and Jumia’s parent Rocket Internet, have no shortage of it. On 9 July, the German announced it has raised $1 billion in the last twelve months; the largest any internet incubator company has ever done.

German, American and Swedish investor funds have also allowed Jumia draw up massive marketing budgets, which has been a strong tool for market share growth. Its marketing team alone (without sales) is 30-person strong, while daily ad expenditure i“runs to the tune of tens of thousands of dollars… mind blowing really,” according to another ex-staff, who pleaded anonymity due to frayed relationships with the company.

Conspicuous Jumia billboards dot the landscape at strategic locations across Nigeria’s major cities. The same manifests online – where its promotion is so fierce, one would be forgiven to think Eric Schmidt’s only customer on Google Ads is the general merchandise peddler from Nigeria.

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There are those who will say this marketing has paid off: its online storefront ranks on Alexa as the 17th top site in Nigeria at the time of going to press, and the retailer says it is the 4th most visited site in the country.

It should watch its back though – Konga’s Alexa rating has sky rocketed from 57th earlier in the year to the 23rd top site in Nigeria, incoming strongly against its foe and probably driven by the fresh injection from Naspers MIH. And on conversation-driver Twitter, @shopKonga is followed by around 45,000 tweeps while @JumiaNigeria packs a meagre 17,000+ (though Jumia has the lead on Facebook).

Size doesn’t really matter

“There are no generally accepted data, but you can check both retailer’s timelines,” says Dikachim Nwankwo, chief executive of Friskaa.com, an Enugu-based online grocery store, in comparing both on performance.“Jumia with far less followers has more complaints from customers about their products and delivery. That says a lot about Jumia’s propensity to lose customers and Konga’s ability to retain customers. At least, their Twitter TLs (timelines) represent a reliable random sample opinion of the entire Nigerian market. Jumia could be accessing new markets and gaining new customers, but is the retailer retaining them?”

Indeed, an extensive search through the social networking site throws up a stream of complaints. “@JumiaNigeria what is d status of the Quality control check on my retrieved Item?I need my phone ASAP Order No. 300591716 *infuriatedcustomer,” cries one tweet.

There are yet others:

“I will never order from @JumiaNigeria again”

“@JumiaNigeria finally delivered my order today. Alhamdulilahi.”

Of course there are complaints about Konga – “@ShopKonga I am yet to receive my order despite all the promises. Bad Customer Service,” for one – but, a sampling in the first of July shows that @JumiaNigeria had received 5 complaints while @ShopKonga with three times more followers had two complaints.

“Even when their delivery isn’t okay, they’re so courteous about it,” says Funbi Shobode, who is a Konga customer. “They will call, apologise and explain everything.”

Reports point to mounting claims of faulty Jumia products – in one case, thanks to a new laptop computer delivered in, of all things, an envelope. Then there is the customer who went on a social media rant due to the faulty shutter button of a new white Nokia Lumia phone. The phone had to be returned three times – and when it finally delivered, it was yellow.

This raises a cart-load of questions: Are the products (especially the much coveted smart phones and consumer electronics) acquired directly from the manufacturers?  What is the reliability of the relevant government checks and examination of inventories shipped in by these online retailers? Are they even checked?

Learning curve

“The main issue with Jumia is that they are in a learning phase which is okay but they are also expanding too fast at the same time which is why they are messing up,” explains the founder of an online retailer, who asked not to be named. “They have not learnt how best to store their wide inventory efficiently without damage to the products.”

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Another former staff, who worked in Marketing for three months before leaving in not-pleasant conditions says: “This is what the Germans told us; the best way to get better in a business is to work through the mistakes and correct them as they go – the founders knew we were not ready to hit the market, but they felt considering the opportunities, it was a risk worth taking, and I don’t disagree.”

But there are those who wonder how Konga manages to defeat the same devils and emerge the logistics king. Despite Nigeria’s transport problems, the indigenous Internet retailer appears to demonstrate all around better customer service, superior supply chain logistics management and, to reach for candour, pisses off far less customers.

Maybe it’s Shagaya’s experience with previously running DealDey.com. Or maybe it’s just something about the man himself.

He is the toast of conferences across the country – including the May Lagos Business School Africa Business Conference where participants could not get enough of him – and it was easy for me to find out why. In four years of interviewing business leaders, Shagaya is the first chief executive to turn the lens and try to understand the interviewer before I could even ask the first question. There is a genuine curiosity about people that surely must serve him well.

It certainly makes him very believable when he speaks so passionately about customer service and how much he “really cares” about his employees and customers and “pursues customer satisfaction” (in retrospect, Afaedor only evoked such passion when speaking about Jumia’s expansion).

This doesn’t mean Jumia isn’t passionate about its people.

[READ: Oluseun Onigbinde on the ‘Unpaid goon of the cabal’]

“I look forward to resuming at work everyday and even at 7 most times I’m still at the office,” says one member of its staff unaware of my mission at the Lekki workplace, which strikes one as more driven and given to spontaneity, as mirrored by its attractive YouTube corporate video. “The people here are crazy. I love them. It’s also very competitive. Even as a customer service, I’m required to bring in customers. It generates more sales and earns me points.”

Keep walking

Not surprising, considering its Managing Director’s background is focused on business. Kehinde, a King’s College old boy, completed his first degree at Howard University after which he secured an MBA at the prestigious Harvard Business School. He acquired working experience with English multinational alcoholic beverages company, Diageo.

In this fierce e-commerce battle however, his George Washington University engineering grad opponent comes with the advantage of experience.

For two years, Shagaya was an executive assistant to Africa’s 40th richest man and Etisalat Chairman, Hakeem Bello-Osagie, under whom he studied the Nigerian corporate terrain. Shagaya’s professional profile also reveals roles as West African Principal of SouthAfrica’s Rand Merchant Bank, Google Africa lead, E-motions and DealDey.

He is now the founder of Konga. But unlike at any time in his corporate life, he is up against a competition finally worth his talent for building cutting-edge companies.

One year after, the Nigerian customer can now take a ring-side seat.

Comments (5)

  1. I ordered online Samsung galaxy Tab, 32 GB and the adaptor as well as other items. It took me 2 months to finalize the transaction and the despatchers will want to part with something from you. I complained about this to Jumia and nothing was done. Jumia sent in wrong items to me twice and I had to go to an agreed designated area to collect and return those items. Please beware of Jumia. All that glitters is not gold.

  2. Nice analysis, but sure to bore a reader with the hidden bias towards Konga within the article. Its impossible to say its all gravy with Konga, c’mon lets get real about this. Regarding complaints on the jumia twitter page vs. Konga’s, should number of people on their fan pages or digging deep into how many orders they may achieve daily be the true judge? Same reason goes for them being proclaimed ‘logistics king’. I mean if i sell purewater to 500 daily and another sells to 10 given the same socio-economic environment and time, irrespective of how many friends i have who may not actually even know what i do; whos likely to get more complaints, whos likely to deliver faster. While not making an excuse for bad customer service, but i think journalists should try harder to go beyond sentiments with such analysis and dig deeper. What has interview with Sim got to do with what they are bringing to the nations economy, and to use that to put the guys at jumia down for exclaiming passion for what they do….shame!!! I have shopped at Jumia, i have been dissapointed once and was made up to me in ways i found most pleasing and since that day myself, my family, neighbors, loved ones..will shop only jumia, at least till the day i get to read your well researched analysis. Coming to think about it, every point was negative for jumia and always shed the other guys in better light, abeg jor! Saw ur headline hoped to read more about the 90000 square feet warehouse and product assortment, brands which is more important to me the shopper, than the smile on Shagaya’s face (who cares). Great subject…..unjustified delivery. Cut Tunde and Afaedor some slack, they are achieving what Shagaya wouldnt have dreamt about 10 years ago, worthy inspiration to the youths of our country…as opposed to your conclusions, they are a worthy example to youths of today that you dont need to carry briefcases for years or even be scared to achieve your dreams. If i could turn back hands of time i surely will go the Jumia entrepreneurial way, sure Shagaya would say the same. I rest my case. Sentiments aside, truth be told.

  3. Very interesting article. Too lengthy I might add. In my opinion, I think I prefer Konga.com. I mean check out their interaction on twitter and facebook. Their customer service is second to none. I’ve bought stuffs countless of times and have never had a reason to complain. They’ve even gone a step further to make video reviews of products and put up on their youtube channel. Now that’s an e-commerce company that knows and truly take the customers to heart.

    As for Jumia, I can’t be bothered with them. First, they are not entirely Nigerian, so their interest in the Nigerian customer may not be paramount. You tweet at them & it takes eons to get a response. Konga responds to your tweet even before you click the ‘send’ button. After my husband and Uncle were disappointed by Jumia, I strongly recommend Konga.com to anybody that values great service and their money’s worth.

    Besides, the records, as elaborately described by this piece are obvious for all to see. Konga rules this with or without who has more money or PR.

  4. This article is long and winding. All the information could very easily have been passed across in 4 or 5 paragraphs instead of this long and boring story.

  5. I like this analysis, I agree with what you said about konga. My delivery was late and they called and apologized and explained why it was running late. They have won me over. However I think we need both of them, jumia and konga to remain in the market and keep improving because with competition the customer wins out in the end. If konga can keep the steady growth, I see it moving beyond Nigeria and taking the rest of Africa by storm. These two companies remain an inspiration for many entrepreneurs out there. I am proud of both of them.

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