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UNIT 3 Introduction to marketing Task 3.1
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UNIT 3 Introduction to marketing Task 3.1 P1 M1 D1
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Task 3.1M-KOPA SOLAR
M-kopa is a not for profit organization that is established as a social enterprise that aims to
provide affordable solar panel devices to rural areas across East Africa. M-kopa sells a range
of essential devices such as solar-powered fridges, televisions (TVs), sola lamps, radios,
cellular phones, and USB power outlets for charging mobile devices. M-kopa’s competitive
advantage in the market is the fact that customers purchase their products on hire purchase
through monthly instalments using mobile money transfers, similar to TV subscriptions such
as on Netflix. For example, the M-kopa 6000 Package includes a 32-inch solar-powered flat
screen HD TV, 2 solar lights, 2 solar tube lights, 2 phone charging cables and solar light
extension cable. This package is paid over a 600-day period with daily instalments of Kenya
Shillings (KES) 135 per day following a deposit of KES 8,499. M-kopa has revolutionized the
solar-power business for Kenyans.
In order to sell its products, M-kopa uses several marketing strategies that can broadly be
categorized under two main components that include Business-to-Business (B2B) marketing
and Business-to-Consumer (B2C) marketing approaches. The choice of their strategies is
decide based on the needs of their business, their target clients and as well as the unique
specifications of their products. Some of the five main strategies used by M-kopa are B2C
and includes the follow:
1. Growth strategy through market penetration
2. Survival Strategy
3. Branding
4. Paid advertising
5. Internet marketing
Market Penetration Growth Strategy – This strategy is used to increase the sales revenues
of a business by increasing the number of products and services that it offers to its existing
market. M-kopa has been able to successfully achieve this by offering different products to
the same customers in order build customer loyalty and increase their market share in a
range of solar products. For example M-kopa usually starts by offering a basic package that
may only include a solar lamp. Once the customer has completed their payment and owns
the product, M-kopa offers additional products such as TVs, radio and fridges on a new hire
purchase agreement. M-kopa saw an opportunity for implementing affordable pricing on
solar energy because most solar energy products are very expensive even for the middle
class. M-kopa penetrated the solar energy market by providing solar energy that is targeted
at areas and homes that cannot afford electricity or no electricity support. Because no
company in Kenyan had done that, the sales for M-kopa’s products rose and their market
share increased.
Survival Strategies- M-kopa has some strategies that allow them to stay afloat even though
they are a non-profit organization. For example, M-kopa strives to raise its revenue by
introducing new devices in their packages. By doing this, more customers are bound to
purchase new products. For example, people are more likely to buy the M-kopa 600
package instead of the M-kopa 6 package because they have more to offer for a slight
increase in price. Moreover, M-kopa improves its cash flow by attracting investors to their
, company to stay afloat. For example, M-kopa received funding of $10 million from FinDev
Canada. Using investors for increased cash flow makes enables the business
increase its products and develop new products that can be marketed to the same
customers.
Branding – M-kopa has partnered with Safaricom which is the leading mobile phone service
company in Kenya and has a very strong reputation with a well respected brand. Moreover,
most subscribers use Safaricom as their cell phone provider making Safaricom the most
recognizable company in Kenya. In 2012, Safaricom had a partnership with M-Kopa to
produce the M-kopa 3 bundle, which is 40 shillings per day with the Safaricom tag in every
item included in the bundle. Because the items are branded with the Safaricom logo,
customers got more attracted to the product because of Safaricom's reputation. This
increased M-Kopas sales and branding reputation. Safaricom also helped to promote and
advertise M-kopa by putting the Safaricom logo on their posters and probably reduced the
advertising costs.
Paid advertising – The main type of marketing strategy used by most businesses in Kenya is
paid advertising which involves both print and digital media. The print media
advertisements used by M-kopa incudes, newspapers, magazines and brochures. These
usually include advertisements on the products that are offered by the company especially
when they have a discount or products on offer. The electronic media used for
advertisements includes TV and radio. Besides advertisements, M-kopa has also featured its
products in several TV and radio programs that are targeted at viewers and listeners in rural
areas who may not have access to electricity and can benefit from solar powered devices.
Internet marketing and use of social media – I order to promote its products to a wider
audience, M-kopa has an online website as well as a Facebook page through which the
business promotes its products and services. These are more appealing to younger people
and are also an affordable to reach a large number of potential customers.
CHERUBET COMPANY LIMITED
Cherubet is a private food processing company that produces and sells healthy ready-to-eat
foods such as githeri (a mix of maize and beans) and ready-to-drink beverages like Uji
(porridge). The business aims to process pre-cooked meals without any preservatives and
adhere to strict hygiene standards in the processing and handling of their products. Their
products mainly utilize grains and cereals and target the high and middle class segments of
the market, as a result their main marketing channels incudes supermarkets. Because their
products are perishable and must be stored under refrigeration, their main retail outlets are
located in the larger shops that may include convenience stores. Cherubet’s products are
mainly targeted at consumers who are looking for convenience in food preparation and as
such are willing to pay a slightly higher price for a well-packaged quality product.
Cherubet utilizes several marketing techniques in order to sell it products. Their choice of
marketing is the use of B2B as this enables them to sell large volumes of their products
mush faster, especially because their product are perishable and must kept under
refrigeration. Another important consideration that the business has made in its choice of
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