Kenyan shoppers are driving change in goods packaging, delivery
Pawan Marella and Osato Igbinadolor
While Kenya growth numbers are looking up, at above six per cent, many Kenyans are struggling to make ends meet.
The struggles are made worse by higher prices of consumables relative to peers like Nigeria and Ghana with Kenya’s average cost per item topping Nigeria’s by Sh0.5 and Ghana’s by Sh0.2 according to a household survey by Kantar, a research consultancy firm, which places the trips in Nigeria and Ghana at 390 and 560, respectively.
The Kantar findings have implications on how dealers and manufacturers of fast moving consumer goods package and deliver their products.
According to the study, 80 per cent of low-income household buying local brands prefer big packs of at least 100 grammes, especially on home and personal care products.
The average consumption on the big pack products have grown faster than small packaged one, suggesting consumers are looking for value in a market trend that has seen many local brands cashing in strongly on the back of right price points. The price points of between Sh5 and Sh100 are where the bulk of non-monthly purchases happen.
Consumers are increasingly becoming savvy in seeking affordable, but quality products, bringing to the fore the need for cheaper delivery channels. This has ushered in the refill business model. These approaches hinge on delivery models like dispensers, which is becoming fashionable as businesses seek delivery channels that foster convenience and affordability.
A good case is the growth of fresh milk and cooking Oil “ATMs” in Kenya, which not only help create a friendly environment through cutting single-use plastic packaging, but deliver affordable products to consumers battling against income that is trailing inflation.
Teaching consumers the right levels of product usage is taking centre stage in the quest for affordability. Examples are packs with dosage amounts automatically or ideas like the brand “Less” launched in Netherlands by Eric Smeding.
Smelding is leading a home grown start-up that seeks to change how people use detergent. His dosage device may see consumers using less of what we sell – but in a more sustainable way.
There is a need for sustained joint effort by stakeholders in manufacturing, retailing and the government in driving sustainable new business and regulatory models, which deliver affordable products and services that ultimately lift consumption of quality products .
— Marella and Igbinadolor work for Uniliver East Africa and Kantar EA, respectively