the africa market research challenge - sis international

8/14/2019 The Africa Market Research Challenge - SIS International

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The Challenges in Conducting

Market Research in Africa

Presentation By:

Neal SandinSenior Project DirectorSIS International Research

September 2008


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Foreword ........3

Infrastructure .........4

Cultural Barriers ......12

Government Bureaucracy ....18 Security Issues......... ...20

Informal Economy ...... 22

Limited Financial Resources .. ..23

Limited Technical Resources ...24 Recommendations .. ...25

Table of Contents


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Market research in developing countries has a variety ofinterrelated barriers.

By knowing the challenges of gathering and analyzingmarket intelligence, business opportunities come to thefore.

Africa is taken as a lens; the learnings here can be

applied to other developing and emerging regions.

Foreword

Foreword


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InfrastructureInfrastructure

It is estimated over 80% of the populations in sub-Saharan Africa is rural based.

Poor transport and road system

Lack of ICT (telecommunication, electricity, et al.)

Low levels of literacy.

Africa lags behind in the use of ICT, has low telephone penetration, access to internetand high tariffs. African research is still largely dependent on face-to-face interviews.

Studies shows that 97% of the population in the rural villages surveyed already knewabout mobile telephony, and 50% had used a mobile phone. By contrast, only 33%knew what a computer was and only 3% had ever used one. Ericsson surveyTanzania 2005.


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PrimaryRoad

Network

Data are from 2003 or later

Source: African Marine Atlas htt ://iodeweb2.vliz.be/oma /OMAP/index.htm

Primary Road Map


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Secondary Road Map

Source: African Marine Atlas htt ://iodeweb2.vliz.be/oma /OMAP/index.htm

Data are from 2003 or later

Secondary

Roads


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Source: Wiki edia.or

Population Density


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Africans wait ~5 years for a fixed telephone, in some countries 10+ years. ~ 2.5 million Africans are currently on waiting lists for fixed telephone lines

By early 2007- mobile users constituted almost 90% of African telephonesubscribers Building cell phone infrastructure relatively less expensive than rolling out

landline connections to every home In Kenya mobile telephony Giant Safaricom established a joint venture in May

2000 by October 2007 the company had over 8million subscribers and made aprofit of a quarter a Billion USD, it has become the largest company within theEast African region in only 6 years of operation.

Still has one of the worlds lowest mobile penetration rates

Source: htt ://www.marketresearch.com/ roduct/ rint/default.as ? =1& roductid=1587984

Telephone Infrastructure


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1976-2001 % Growth in Telephone Penetration

Negative

0% 200%

More than 200%

Source: htt ://www.if ri.or /PUBS/ib/ib32. df

(Per 100 Inhabitants)


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Top 10 Internet Countries in Africa (March 2008)


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Internet Penetration in Africa (March 2008)

Source: www.internetworldstats.com


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Cultural BarriersCultural Barriers

The varied country-to-country cultural practices and norms in thecontinent pose a challenge in many areas and in particular ruralAfrica.

In Djibouti and other Muslim countries it would be difficult to for a man toconduct FGDs with women.

During the Holy month of Ramadan for Muslims, research should besuspended in predominantly Muslim countries.

In 2008, this falls within the month of September.

Depending on the information required one may hold back vital

responses to a survey as it may be in conflict with their culturalbeliefs

Common among the Bantu in Sub-Saharan Africa, it is considered badmanners in many African cultures to disclose your wealth or the numberof children in your household.


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Ethnic & Language BarriersEthnic & Language Barriers

High percentage of rural populations rely on tribaldialects.

Forcing market research agencies to translate the questionnaireinto different languages

Respondents may not be receptive to an interview froma person perceived to be from an ethnic group.

Market research agencies need to widen the variety of field staffaccording to their tribe.

In Kenya, after the recent poll violence, regional teams have hadto be reshuffled with regard to interviewer ethnicity


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Over 1,000 languages However, there are populations of people that speak English, French andPortuguese

4 major language families native to Africa

1. Afro-Asiatic

2. Nilo-Saharan

3. Niger Congo

4. Khoisan

Source: Wiki edia.or

Language Diversity


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# of Languages Spoken by Country

Source: htt ://www.ethnolo ue.com


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In 2000, the average literacy rate in Sub-Saharan Africa was 52per cent for women and 68.9 per cent for men.

Gender disparities prevailing in 75 per cent of the countries inthe region.

Western African countries have lower literacy levels, withSouthern African countries being the most literate, which forcesreliance upon face-to-face interviews.

Increases operational costs, although the wage costs forcarrying out research fieldwork average at 20USD per day.

Literacy Levels


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Africa Literacy Map


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Government BureaucracyGovernment Bureaucracy

In most countries, it is a requirement by law to obtain a permit beforeconducting a study.

Especially when it comes to demographic, religious and governance questions.

Examples: Sudan, Djibouti, Eritrea and Zimbabwe requires that a questionnaire

to be reviewed by a government agency and in some cases may insist onaccompanying the interviewers.

Permits may take up 21 days to be issued.

Cases of corruption are rampant, illegal searches and confiscation of studymaterials are quite common

e.g. In the Democratic Republic of Congo and Angola, one needs a differentpermit to conduct the same survey in every regional city.

Few African countries conduct regular population census or social economicsurveys with the exception of South Africa and North Africa.

Difficult to determine appropriate methodologies or developing sample.


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Source: 2007 Human Develo ment Re ot b the UN- based on 2005 data

HDI: Avg. life expectancy,education index, adult literacyindex, GDP at PPP Index, andgross enrollment Index

By comparison,

all of WesternEurope, NorthAmerica, andmost of SouthAmerica is above

0.900.

Human Development Index


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Security IssuesSecurity Issues

Hot spots: Darfur in Sudan

The Nigerian Oil Delta

Increasingly becoming a problem in the low income (slums)

dwelling areas Soweto, South Africa

Kibera, Nairobi

Lagos slums

Slums are characterized by a severe lack of government securityand are controlled by criminal gangs who extort money from tradersand do not tolerate outside interference.

Yet, important research needs to be done is such environs.


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Despite peace accords fromcivil wars, parts of westernSudan remain volatile

The Democratic Republic ofCongo still in civil war

Sections of Algeria are off-limits

Barundi, Zimbabwe, SierraLeone, and Liberia shouldalso be considered with

caution

Source: htt ://www.africatravel uide.com

Areas of Unrest


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Informal EconomyInformal Economy

Particularly within Sub-Saharan Africa, the informal retailmarket accounts for over 50% of all retail trade in allcategories.

Continued existence of the barter trade Challenge in:

Estimating market size, volumes and trends

Identifying their product route to the market

Tracking and monitoring consumer habits and behavior

In Tanzania, the total milk productions stands at over 1.1billion liters, however only 14% finds its way to the formalmarket channel


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A large percentage of financial institutions are very cautious infinancing service-related institutions.

Most agencies are hampered in expanding developing operations.

With the exception of multinational affiliated agencies, mostresearch agencies are forced to bill fees to finance operations withlittle resources left over for key aspects such as: Staff development R&D and innovations

Technical upgrades on software and hardware Networking and expansion

Limited Financial ResourcesLimited Financial Resources


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The technical ability of research agencies remains low, with notableexceptions within Northern Africa, South Africa, Kenya and Nigeria.It remains necessary in most countries to accompany, train andsupervise fieldwork at local level to ensure quality in delivery.

Poor access and technical ability in handling hardware and softwareforces agencies to process data at a central location regardless oflocation of study.

The number of local companies engaged in research for their

markets remains low. The industry at present performs below expectations with local

research revenue driven by multinational agencies such as Unilever,Coca Cola and Diageo. The other players include bilateral and non-

governmental agencies within Africa. Few institutions offering studies at a university level in market

research. Kenya has only one institution offers training on MR.

Limited Technical Market Research ResourcesLimited Technical Market Research Resources


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Communicate with the field team by SMS text, not by email.

Face-to-Face methodologies should be considered first.

Do not rely upon government statistics; NGOs (e.g. IRC) have excellentreports on social movements and situations.

Contact NGOs who have completed research in the area. Find out whothey worked with and difficulties involved.

Be aware of social mores when assigning interviewers.

Timelines must be flexible, and projects on a best efforts basis. Monitor political and social situations closely.

If there is an election, wait until it is over before starting or resuming research

A holiday in a current (or recent) conflict area should be observed closely

Recommendations

the africa market research challenge - sis international

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