Why market education is important for technology companies
TRAINING FOR CHANGE
After Econet Wireless Nigeria got their GSM License and before they launched services, they decided to educate the market through the most popular means at that time, the newspapers. The regulators and the companies who bid for the GSM license knew what the technology was for and how it operated. Those who had travelled abroad and used cell phones knew. The wealthy and fortunate people also had CDMA cell phones provided by MTEL at that time, but hardly anyone in the mass market understood anything about GSM technology or its applications. People didn’t even realize how transformative it was going to become in their everyday lives.
Econet went to the newspapers and sponsored a regular column to educate the public on GSM technology and how to use it. The column also highlighted the advantages over CDMA and how it had worked in other countries like Zimbabwe and South Africa. The result was that this information spread by word of mouth and demand became very high when they finally launched. Subscriber SIM cards were sold out. The most optimistic projections of the entire market for GSM devices in Nigeria was 20 million customers. Now, the largest network company has about three times that number alone.
Training or retraining people on new technology is a very powerful tool for “Change.” For Mobile Payments, the Telco’s in East Africa started using Agent Networks not just for product distribution but for training. They educated the agents and the agents, in turn, taught the market. Product ubiquity was made possible not only by the location of the agents but their activities in educating the market. A lot of first telco agents in Uganda were the people who owned bars. It was also in their interest for the market education to happen, especially as the product would also save them all the headaches of cash management. They became not just telco agents but technology change agents.
It is easy to overestimate a market or underestimate how much education is required before products can gain mass acceptance. I had a conversation recently, with a friend who is trying to set up an initiative to train new software developers in Nigeria. His premise for setting up the centre was that, there was a lot of demand for software skills as he kept on getting requests for developers daily. My question to him was how viable are those businesses seeking for the developers? One thing I learned early in the technology business is that a deal is not a company. The product is also not a company. Business is a going concern. To create a going concern, you must create sustained demand.
Sometimes, technology companies fail not because smart people did not run them but because they were not “street-smart people.” Knowing the streets when it comes to technology is a lot more about empathy than shrewdness. My good friend Chukwu Emeka Afigbo of Facebook refers to the vast knowledge gap that exists between those in the streets and those building technology products as “The Abyss of The Great Outdoors.”
The “Holy Grail” of all technology products is a term called “Product/Market Fit.” The famous Silicon Valley Venture Capitalist, Marc Andreessen defines Product/Market Fit as “Being in a good market with a product that can satisfy that market.” For new markets, the potential users may not know about the product or how it can satisfy them. Stumbling into new use cases for a product is not the best way to achieve fit. Sometimes dedicated education is important especially in a market with limited technology knowledge. Once a key customer demographic learns how to use a product, they usually educate the others by word of mouth as it happened in the case of GSM products.
Sometimes, more formal training of a market is required. My first Job in technology after my National Service Year was to serve as a trainer at a technology company. The company had just taken over the local typewriter, and Personal Computer business from IBM in the late 80’s. PCs were available, but typewriters were outselling them. The “IBM Selectric” typewriter had just launched, and it was quite popular with corporate “typing pools.” I was hired at that time as Head of Corporate Training for the Personal Computer Business, and my job was to educate a new market. I did not expect that we would increase the PC business and kill the typewriter business with something as simple as training.
We started gradually by deploying a few personal computers, and I had to retrain the secretaries on how to use this new technology. Hewlett Packard laser printers had also just launched, and the output was much better than those of typewriters. One major oil company in Lagos returned 300 typewriters it ordered and replaced them with IBM Personal Computers after we concluded one of those training exercises. The typewriter business unit shut down after that happened and the focus was now on PC’s and Software’s. Training made the sale happen, but it also caused a technology discontinuity. Computers killed typewriters, but it was because user training also became a business. The Indian companies, NIIT and APTECH, made a fortune in Nigeria not just from training technology practitioners but also end-users.
DIGITAL TRAINING AND COMMUNITIES
These days, there is a lot of focus on digital marketing as the assumption is that the youth demographic are already “digitally aware”. A friend was shocked recently when a major airtime dealer in Ikorodu did not even know what Jumia and Konga were all about. He was not on the Internet enough to make sense of digital targeting. In addition, he was blissfully unaware of e-commerce. Advertising is sometimes a cost-effective way to educate the mass market, but the best way to train is through interaction. We could not have trained the typists at Chevron through adverts. Mobile Money would not have scaled in East Africa through adverts alone. Advertising helps to create product awareness, but education best closes the last-mile into the Abyss of the Great Outdoors.
The large technology companies encourage user communities and facilitate user groups; they go much further than start-ups would. There are elaborate user and developer community events which are meant primarily for education. They also use the media very effectively to educate their market. Facebook launched a new product recently called WorkPlace. It is a product for the enterprise market. They distributed very elaborate videos about the product and are already building a community around it. Facebook is trying to break into an existing market and create a new market at the same time. In Africa, Google has been the most efficient at community engagement. They start from schools with student groups and have a well-developed partner ecosystem.
A lot of technology start-ups die globally because they ignore partnerships and distribution. In Africa, they are worse off. They die because they don’t have the proper distribution that educates the market. Your being on an App store or involved in digital marketing is not enough. The Telco’s taught us a great lesson, but most start-ups still prefer to look at foreign models rather than look at successful local models. Traditional media is still very powerful. Google is advertising on Billboards in Africa now. Newspapers are still very relevant; I would not be writing for the Guardian if they weren’t. What we are doing here is also “Market Education.”
No comments yet