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What’s Google East Africa’s strategy?

So I came across this post by Kenyan Entrepreneur and I was just as perturbed as he was.

Why would Google East Africa sign a deal with Wunderman (and who are they…can’t even locate a website?) rather than promote adwords accounts in East Africa? Is it difficult to do online transactions in East Africa (but then surely how are Mama Mikes et. al. surviving)? Are Kenyan companies difficult to sell to when Google approaches them directly? This deal doesn’t make sense.

Another point made by KE a while back…is Google being a little cheap with their gadget competition for East Africa where you stand to win $600 as a first prize. How about maybe a $1,000 or a contribution towards the student’s tuition? The top prize for high schoolers who participate in the Summer of Code jam in the U.S. is $4,500… The attention being paid to young developers in Africa is appreciated but I’m wondering whether the nature of the prize is sending a subliminal message about the quality expectations that Google have of East Africa vis-a-vis other parts of the world. Or maybe I’m just being touchy.

And then the deal with Safaricom. Why would anyone sign up for a “free” Safaricom address if you already have a free gmail account? No wonder the uptake been slow. Has anyone tried this?

It’s not all bad though, I hear the local mapping is going well and they are making Google Apps available for free to local universities.

21 comments to What’s Google East Africa’s strategy?

  • jackie

    I did see that google Ad. and i was disgusted.
    Infact…and i could be wrong, the 1st price is $350. Is that something Worth Africans Busting their behinds for? Well, Shock on Us.

  • Anon

    Ory, kudos yet again for sparking important conversations that need to be aired and discussed.

  • I just wanted to make a comment on the Google/Wunderman issue. Kindly note that Wunderman (www.wunderman.com) is one of the leading direct and digital marketing agencies in the world. A very quick goggle search would have given whoever wanted to know that information. Whats Google’s strategy? I would think apart from everything else they are doing….they are a corporation that has to make money for its shareholdings….last time I checked Adwords still made up a very significant portion of their revenue…. Oh…and by the way…anyone can sign a contract to sell Adwords online….that’s the beauty of the times we live in.

    Oh, one last point. I believe we could use our time better as Kenyans (and Africans) by cutting down on this activism and actually making use of the platforms companies like Google provide to engage in Entrepreneurship as opposed to Activism..

  • Ory Okolloh

    Abujomo, thanks for your comment. I was actually looking for a local Wunderman website seeing that they will be assisting local clients with online marketing and advertising.

    As for your point on Adwords, that’s exactly the point I’m making…so, if anyone can sign a contract with Adwords why use Wunderman – I’m not hating on anyone, just trying to understand the logic of the partnership. Care to explain?

    Finally, I don’t see questioning dodgy strategies by companies who are keen to exploit the African market as time wasting. And, activism and entrepreneurship are not mutually exclusive activities…just ask the Google founders.

  • Ory

    Noted. Thanks for your quick response. Wunderman in Kenya is part of the AY&R Group, which has been operating in Kenya since 1972.

    On the issue of the Google/Wunderman partnership, what I meant is that anyone else can get sign the same partnership -its not exclusive…its just that no one else has tried or applied…

    On the activism issue…here is my take. I agree with you entirely. I would actually have hoped that the Kenyan Pundit for example would be running Google Adsense…That way one gets the best of two worlds…Activism and entrepreneurship…That way the blog educates and keeps people informed and at the same time makes some money to keep it going…I don’t suppose that keeping a site like this going is cheap…You get my drift?

    Otherwise, I do hope that the Kenyan Pundit keeps up the good cause…its always refreshing to get contrarian views…

  • kombamwiko

    so I guess the question remains, what is Google’s strategy in/for East Africa? The answer, IMHO, lies not in the value of a gadget prize but more in the clearly huge efforts that are being made to equip Kenyans and by extension East Africans with tools and platforms out of which they can create revenue and opportunities for themselves and others.

    As already pointed out, Maps is huge. The potential and utility that is now available locally is pretty significant. Nevertheless, Kenyans and EA resident probably need various tools/aids to help them fully participate in the current content revolution….

  • NonPulised

    Actually, I think Google EA’s hooking up with the Marketing firm is a smart idea. They can leave google adwords as is, and let the early adopters, and do-it-yourselfers take advantage of the fact that they don’t need an intermediary.

    It is getting to the corporates, that the marketing firm comes into the picture. We are talking of decision makers, who I would be surprised even turn on a PC , leave alone read their own e-mail, ! Ubuntu, a free operating system that would save many companies lots of money has not caught on in companies. I would bet even in the economic downturn they will not explore using Ubuntu versus Windoze.

    If changing the wrapping is required to make the sale then go google!!!

    The e-mail link with Safricom, I also think is ingenious, although maybe a bit early for the market. If they want to grow the market and bring people who do not use the cybercafes, blog, or computers, ( and incidentally quite a number have better than average purchasing power) a safaricom e-mail would really work. Yahoo and Southwestern Bell ( local telecom, broadband provider) did that in the United States in their DSL signup promotion.

    To sum up, I think, (I might be wrong here) but Google EA is deploying strategies to “cross the Chasm”. “Crossing the Chasm” (http://en.wikipedia.org/wiki/Crossing_the_Chasm) is a reference to a book by Geoffery Moore, on technology adoption, and marketing.

  • I think its naive to think, even for a second, that Google’s expansion in Kenya is driven by philanthropic needs. Even google.org, the organization’s philanthropic arm is driven by a very business minded model. Profit profit profit.
    Not that there is anything wrong with profit. Just that as Kenyans we need to keep a keen eye out because we don’t want to bear the costs that any company, not just Google, externalizes on their journey towards profit. Basically, we need to start with the assumption that Google will somehow make their profit. Question is, what cost will we Kenyans pay? And I think there is always a cost. Its just a question of how we distribute it. Is it borne by the poorest in society, or more heavily shouldered by the wealthy?

  • Everyone needs to step back and look at the big picture. Google is not just expanding into East Africa. The exact same initiatives have been launched in the Middle East too – these are regions with a +1000% growth rate in internet reach and penetration (In the last 5 years) – so there’s plenty of potential down the road.

    These regions are tiny though in Ad Revenue Sales (Both Online & Offline) in comparison to the West and Asia… which is reflected in their Google Gadget Prize. Expect the prizes to be worth a lot more down the road as the market grows.

    Google is positioning itself to become an Media Powerhouse. Forget the internet – Google has taken major steps to integrate TV, Radio and Print. Does it now become clear why Google has started targeting Media Buying agencies like Wunderman so early? Google plans on becoming the one-stop-shop for media buying. Imagine this… Kenya Airways could go to a firm like Wunderman for all their media buying and Ad Agency needs – TV, Print, Radio and Online… you name it. For Wunderman, all their work would be streamlined in a special interface google has been working on – just for Ad Agencies. Detailed reporting is included!

    So yes – Google has a grand strategy. 👿

  • Ory Okolloh

    Thanks everyone for the enlightening comments…I can see clearly now…hehehe (and I was not implying that Google should be philanthropic in any way, just trying to understand their grand strategy in East Africa as it were).

  • This is a really really lively debate! My take is that ultimately, Google will make close to zero in East Africa for the short-term. However, in the next few years, things will really begin to take off as internet adoption grows and local online content and services proliferate. As for Wunderman, they are showing all the old school agencies the future of marketing has arrived and they plan to stay relevant, even if very early in the game. Its important to have a global context instead of a kenyan one in what has transpired.

  • On the Wunderman deal, it seems this is a B2B kind of transaction. Consumers and small time players need not apply.

    The GOOG folks have cornered the market even before the game has began. They are hosting all the data in Gmail, blogspot, Maps, search, youtube etc what else is left for the rest of the entrepreneur wannabes to fight over? There is no “free ride” here, we are nothing more than e-squatters (nice word that)in their plantation.

    On Safcom email- i think it makes a lot of sense if it ported to their phones.

  • Ory,
    Maybe some “expert” told Google they couldn’t get into the East African market without going through these companies. The reasons could have been many. One that I could think of, they were sold on the idea that we don’t know what the hell Google is.

  • David and NonPulised , I see your points and have to agree. If the strategy extends past the net into the other medium Google has been getting into, they working with local agencies is a great way to enter a market.

  • Interesting post Ory,

    I don’t think anyone on this list would be privy to know or understand Googles strategy. It does however make some good blogging posts. Davids idea and foresight that Google could be forming long term Media strategies sounds more formidable. A few years ago when a company called Spot Runner was launched – http://www.spotrunner.com/ – I knew it would make sense for a lot of Interactive companies to merge or make long term mergers with traditional media.

    That has been the case and point in the US largely throughout the later part of last year. Mergers and acquisitions of traditional and New Media marketing/advertising companies. I am okay with Google being in town, I am okay with them implementing what i call the “hit or miss” ideas. Companies do that all the time. What am not happy with is the value underpinned to the gadget competitions and the value prepositions of different Kenyan developers.

    I’ve often said that if Google is serious about seeing real Animal applications, developments or ideas from Kenya/ Africa. Why not assign a handsome amount like 1million dollars. I am sure a list of talented Kenyan developers who sit behind Oracle, SAP, Sun Microsytems, Google, MSFT desks everyday will come out of the woodworks to create interesting things. 1Million is nothing compared to the 10Million for the Android developer winner.

    I understand what Google hopes to accomplish in Kenya/Africa – I dont see how they are doing it, but I understand it. For what its worth possibly not now, but in the future – the same impact Adwords has had in the US/UK market will have ripple effects in Africa as a whole. Possible Mobile phone Ad applications may be integrated and we will all be one happy family.

  • I see two things here: Google looking for a market and Google searching for talent.

    Like Leo, I am happy with whatever strategies they employ to monetize their services in the region – through Safaricom mail, Wunderman, adwords … you name it. I just hope they dont land here with big corporate mentality (e.g. Microsoft, SAP, Oracle)

    It is unfortunate that they would give such low prizes for their Kenyan competitions and $10 million for Android. However, Kenya is human capital rich, and some people still find that attractive and if that will draw people into developing useful apps, then I’d commend them. After all, who else is offering prizes for local content developers?

    It turns out though, that for them to get the real market, that they can monetize directly, they need to engage local talent in developing content that is locally appropriate and popular. How much they invest in local talent thus might in the end determine how successful this market develops into for them

  • I was really amazed by the Google deal with wunderman. There was a time some company I was working for in Nairobi wanted to buy some adwords and I cornered some Google sales reps and asked them if I could write them a cheque for the adwords and then I start working and guess what ? I could not do that directly with Google and yet I can use my credit card and pay the same this is the mentality Kiptum is talking about.

    Google needs to embrace local talent in a way that is beneficial to them and also to the local community to create a truly beneficial partnership now and in the future…

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