Category: Blog

Prospects of E-marketing for SMEs in Africa

E-marketing has the capability of offering numerous benefits to SMEs in Africa. Using the research conducted by Bostanshirin (2014), the prospects that e-marketing offers to SMEs in Africa include the following:

1. The Mutually-Inclusive Benefits of the Different Methods of E-Marketing

The individual prospects of the methods of e-marketing for SMEs in Africa need to be briefly analyzed in order to curb some of the challenges portrayed by the adoption and usage of online marketing by the SME operators. For instance, the major objective of online advertising is to increase sales and build brand awareness for these African SMEs as they are becoming recognized at the global market. Email marketing procures high response rates, and it helps reduce the costs as compared to the traditional way of mailing stakeholders.

With search engine optimizations (SEOs), Parikh and Deshmukh (2013) offer this analysis: “The purpose of SEO strategies is to place a given website among highly-listed entries returned by search engines which in its turn, produces more traffic. Its importance lies in the fact that customers most of the time use engines as a major gate to get around in the internet.” Affiliate marketing referring to the process of gaining a commission by promoting products or services of another company has the potential of making two or more website owners to build relationship to increase mutual financial benefits. Another prospect of affiliate marketing for SMEs in Africa is that it can assist extending sales force at the service of a website.

Social media marketing is greatly rewarding and very promising for SMEs in Africa because it increases their competitive edge. It boosts website traffic, or brand awareness, through the use of social media networking sites. Usually, its programmes revolve around creating a unique content that attracts attention and encourages the viewer to share it with their friends and contacts on social networks. The business message spreads from one user to another and impacts with the user in a stronger way because it appears to originate from a trusted source, as opposed to the brand, business or company itself.

Overlapping remarkably with social media marketing and also spreading through social media is viral marketing. It is basically the virtual version of the word-of-mouth marketing campaign. The files used here are small enough to be passed from peer to peer via email after they have downloaded from multiple distribution websites, encouraging greater user-driven spread. They can be tracked after being downloaded. There is also less risk of user interference with the agent. Files like videos are familiar, and are ad-like or film-like formats to users, with the added advantage of interactivity.

[To be continued…]

Introduction [continued…]

In Africa, it is without a doubt that that the number of SMEs exceeds the large companies by a wide margin and also creates around 80% of the region’s employment. SMEs are also said to be responsible for driving innovation and competition in many economic sectors, establishing a new middle class and fuelling demand for new goods and services. This transformational scale should not be underestimated (Filomeno de Sousa dos Santos, 2015).

This is also beneficial for the world’s economy as it creates a growing middle class with such disposable income, vis-a-vis market opportunities for new investors. Large corporations benefit most from SMEs as they depend on them for the completion of various functions, through outsourcing (Frimpong, 2013). Small businesses tend to attract talents who invent new products or implement new solutions for existing ideas.

Several international business forums have concentrated on developing SMEs in Africa. Among the tools for this development is electronic marketing (e-marketing). MBA Skool (2008) defines e-marketing, also known as internet marketing, web marketing, digital marketing, or online marketing, as “the process of marketing a product or service using the internet,” and “also includes marketing done via email and wireless media.”

According to Bostanshirin (2014), there are different methods of e-marketing, all of which achieve similar purposes. They include: online advertising, email marketing, search engine optimization (SEO), affiliate marketing, social media marketing, and viral marketing. Every aspect of life has been revolutionized by the internet. The usage and adoption of e-marketing by SMEs is steadily increasing because it has improved the way of doing business. As a result, its relevance cannot be underestimated.

HOW DO I CHOOSE A FUND?
To help you choose a fund that suits your particular attitude to risk, investment funds have a risk rating, based on the short-term volatility of the fund – that is, the extent to which it has gone up and down. These fluctuations are caused by a range of factors, including geographic location, the market, the companies in which the fund invests, the exchange rate affecting the fund, and the range of stocks in which the fund invests.

You may want to consider international funds. Generally speaking, these carry greater risks to the ups and downs of the exchange rate. Also, some invest in insecure markets of developing countries. However, investing internationally can give your money wider scope for opportunities to grow.

Investing in a variety of funds is often the best strategy. Whilst high funds can increase the value of your investment, any losses you might also make investing in these funds can be absorbed by the income or capital from the low risk funds you invest in.

CAN I INVEST FOR INCOME?
The aim of an income fund is for it to produce a regular income for you. Investing in an income fund for at least five years can provide with regular income and a very welcome supplement to your earnings or pension.

Depending on the amount invested, it could raise your standard of living, allow you to take a career break or look forward to a more comfortable retirement. Income funds are generally a lower risk than growth funds. If you would like to grow your capital but avoid high risks, this may be possible by reinvesting the returns from your income fund in the same fund.

INVESTING FOR THE LONG TERM
Although shares are a higher risk asset (their value could go down as well as up), investing in the stock market for the long term generally gives you a better return for your money, because any losses you suffer are recouped in time.

So if you’re investing on your child’s behalf, or for your distant retirement, time is on your side. Over 10 or 20 years, the value of the shares you hold should be expected to, at least, even out, if not increase. And an amount of compound interest can accrue on investments over such long period of time.

Since the value of shares can rise and fall quite quickly, you should invest for the long term. In practice, the stock market rises and falls in waves, said by some to be five-year waves, and this why many people advise you to invest for at least a five-year period.