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How Ecommerce Using Social Media Platforms is Creating a Market for Online Shoppers and Vendors

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How Ecommerce Using Social Media Platforms is Creating a Market for Online Shoppers and Vendors

The emergence of ecommerce in Africa has seen online shoppers take advantage of the convenience it offers, as goods can now be delivered directly to their doorsteps while they also have the flexibility of selecting the payment channel either using their debit cards or payment upon delivery option. However, as ecommerce continues to evolve and shape how business is done, there are numerous challenges that has been associated with making orders online, these challenges if unresolved over a long period of time, would make the trust the customer has to completely diminish as the reputation of the businesses would also be affected which would reduce the demands and sales.

Social Media for Ecommerce

A major growth that ecommerce is experiencing in Africa is the transition from building enormous ecommerce sites to the use of different social media platforms such as Facebook, Twitter and most especially Instagram to deliver products and services to online shoppers. The advantages of utilizing social media for ecommerce is numerous

  • Social media platforms require no payment to utilize them.
  • Building followership on social media is relatively easier compared to making a website rank well using digital marketing.
  • Interaction between online vendors and shoppers is instant.
  • Online vendors do not necessarily need to have the product until an order is made.
  • No requirement of any form of maintenance for the platforms used.
  • No formal business registration is required to become an online vendor.

While the use of social media platforms for ecommerce has scaled ecommerce in Africa, a major challenge experienced by shoppers is trust. Online shoppers orders for products and receive a totally different order, a damaged order or one that is totally different from what was displayed on the platform. This has been seen with items such as confectionaries, fashion, hair extensions, utensils, electronics etc.

The inability of customers to get a refund or a replacement of the item ordered when it does not meet up with the specification is a big gap that is causing customers to reconsider when making a purchase on social media. Customers are well informed and are now beginning to compare prices of items in a physical retail store.

Reputation Management Techniques for Online Vendors

Reputation management by online vendors is very important as it can help to build a real business from scratch and not a side gig as is done by most vendors. To build reputation, it is important to do the following

  • Create a relationship with prospective shoppers by engaging in visuals such as posting a video of the person engaged in business as an online vendor. A lot of shoppers want to relate with a person they see and the ability to have a visual can help in building reputation.
  • Stick to your terms of order and delivery. A product that should be delivered within 3 days should not exceed the expected day of delivery, and if there are changes, the online shopper should be informed.
  • There should be no hidden charges when engaging in ecommerce using social media platforms.

Conducting Due Diligence Before Making Payment

To avoid losing their monies to fraudulent vendors, shoppers are to conduct dues diligence on the vendors

  • Read through the comment section of the vendors from 3 months, you would either find complaints or compliments.
  • Start with an order that does not cost much in order to understand the vendor’s mode of operation.
  • Insist on paying through an online payment platform such as Paystack or Flutterwave in order to be able to channel complaints appropriately.

To ensure customers are protected, it is necessary to have a system that ensures goods are only paid for when the customer receives them and confirms they are in good condition. This way both the buyer and seller’s interest are protected.

Read Also:

Setting Standards Operating Procedure to Increase Efficiency For Your Business

How Storytelling Can Support Your Pitch to Investors

 

 

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Freedom of Expression: Do the Media have the Teeth to Bite?

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Author is: Aondover Eric Msughter

In Nigeria, apart from the executive, the judiciary, and the legislature, the media are regarded as the Fourth Estate of the Realm. Article 19 of the Universal Declaration of Human Rights provides freedom of expression as part of fundamental human rights. At the level of the African Union (AU), the right to freedom of information and freedom of expression is also recognized. The Nigerian Constitution of 1999 (as amended) equally guarantees the freedom of expression, specifically Section 39 of the Constitution which assigns a constitutional right, power, role, obligation, and duty to the press. Nigerian Constitutions since then have upheld this role. Section 22 of the same Constitution recognizes the media as the “Fourth Estate of the Realm”. It, therefore, means that the media oversees the government and its agencies, thereby keeping them on their toes.

Surprisingly, the watchdog of the society is in the chain, and the million-dollar question is, if the watchdog of the society is in a chain, how will it bite? In other words, the investigators are being investigated, or the guidance in Nigeria is being guided. The inference could be drawn from section 39 of the 1999 Constitution, subsection 3, which states that “nothing in this Constitution shall invalidate any law that is reasonably justifiable in a democratic society for the purpose of public safety, public morality, or public order”. Invariably, the right given to the media by the “right hand” in section 39, subsection 2 has been also taken away by the “left hand” in subsection 3 of the same Constitution.

The implication of sub-section 3 in section 39 of the 1999 Nigerian Constitution is that journalists have no entitlements to any right in the Constitution that is not available to other citizens. For example, it is unethical for journalists to disclose the sources of their information. But it will amount to Contempt of Court in Nigeria for a journalist to withhold information from a judge that would enable him or her to deliver justice on a case forming the basis of a judicial inquiry. This is because journalists have no legal entitlements protecting them against anti-press provisions in the 1999 Nigerian Constitution, unlike the US Constitution where journalists cannot be compelled by the judiciary to disclose the sources of their information.

Incidentally, the law of defamation, copyright, contempt of court, privacy, sedition, obscenity, among others also serve as an impediment to the practice of the journalistic profession in Nigeria. Assessing some of the comments and reactions I have read so far, these laws have removed the teeth of the watchdog on one hand, and on the other hand put the watchdog in a chain, which means that it can only bark but cannot bite.

In a democratic system, where the media can only bark, but cannot bite, it becomes difficult to achieve freedom of expression. However, in a democratic system where the watchdog is operating without much control, there is a tendency that the media will hold the government accountable to the people. No wonder, Jefferson’s preference for “newspaper without government” over “government without newspaper” appears apt in this context.

Thus, for the media to have absolute freedom of expression, there is a need to put on a thinking cap by all Nigerians to ensure that the media are given the mandate to operate without much restriction or interference. Again, the chain that is on the watchdog neck informs laws must be removed, so that it can be able to run or go after people. There is no doubt that today, the guidance is being guided in Nigeria, and this may take one to the question of who guides the guidance in Nigeria? This question should remain a thorn in everyone’s mind for now as it will be addressed in the next article.

 

Aondover Eric Msughter,

Department of Mass Communication,

Skyline University Nigeria

Msughter can be reached via: aondover.msughter@sun.edu.ng

 

 

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What Investors Look for in a Start-up

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A start-up needs investments in order to reach out to its numerous customers especially when the demand for their product or service is high. The major reason for investments in start-ups

Author: Emmanuel Otori

…the availability of consistent cash flow makes a start-up investment ready

A start-up needs investments in order to reach out to its numerous customers especially when the demand for their product or service is high. The major reason for investments in start-ups is the steady growth experienced. Start-up founders need to understand that an investor is not a friend but an enabler with financial capability to help sustain the growth of the business, who in turn expects to get returns in the form of dividends or equity in the overall stake.

Investments in a start-up could be by a venture capitalist, financial institution, crowd funders, family and friends, corporate investors and government organizations.

 

Why Cash Flow For A Start-up Is Better Than Profit

Start-up Founders are usually trapped in the need to begin to make profit and might wear themselves out when business does not look profitable. Profitability is not the most important factor to measure the growth of a start-up. Every investor understands that to classify a start-up as ready for investment, it has to show steady cash flow in their financial statements, which is the primary check to showcase the healthiness of the business.

 

Determinants of Start-up Investments

  1. Team

The success of a start-up depends largely on the team and most especially the experience and expertise they bring to the organization. Start-ups are very fragile and therefore risky to invest in, however with a qualified team whose portfolio reflects a level of experience and exposure in a similar role or organization proves to the investor that decision making would be properly done and tasks executed with precision. A great start-up team is usually to have one with a knowledge of product development and management while the other has the ability to connect with people in order to sell the products.

  1. Traction

Traction is the metric to measure the growth of an organization. How many sales have you made within a specific period of time? How many downloads? How many customers are being served? Traction represents the overall cycle of how deepened the dealings of a business has fostered consistent growth with the customer. The tractions are usually represented in charts to display the gradual progression.

  1. Licenses

Investors are concerned about the level of work that has been done by the start-up founders and these can be shown in obtaining the necessary licenses, intellectual property and compliances to enable the smooth running of the business. Investors want to ensure their investments are secure and would seek a level of understanding in ensuring that the necessary regulations are being adhered to.

  1. Risk Management Policy

Investors like to know what the next line of action would be if the plan does not go as expected, it could also be that the plan is executed as expected but then the business experiences difficulty, what would the next line of action be in order to continue to stay in business. Risk could range from personal risk, financial risks as well as health and safety risks.

  1. Your Competitive Advantage

Investors are aware that there are other existing businesses like your own, one of the ways to showcase that a start-up is ready for investment is to leverage on what makes you better, amplify it in your promotions and show measurably how it has helped to create exponential growth better than your competitor.

Bear in mind, that alongside the factors mentioned, the start-up founder with a good portfolio is the capital reason for making capital investment. Without strength of character, staying power, grit, tenacity and resilience, investment in a person might not suffice.

How Ecommerce Using Social Media Platforms is Creating a Market for Online Shoppers and Vendors

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How Storytelling Can Support Your Pitch to Investors

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Author: Emmanuel Otori

There are a number of reasons a business needs investments, these investments could be in the pre-seed, Series A or B and regardless of whatever stage the business is operating, the major reason for seeking investor’s funding is usually for expansion purposes. This expansion could be in the line of products or the need to serve more customers in their growing numbers due to exponential demands in other regions.

 

Why Storytelling?

Storytelling has been found to be an underlying magic when pitching to investors and while I suggest that the stories should be genuine and linked to why a business eventually took off because the founder was trying to solve a challenge, it also has to be told with clarity and does not negate the fact that Primary Market Research (PMR) should have been done to ascertain that there is a good number of prospective customers that are in need of such solutions, to justify not just based on assumption that it is needed by one person, then there might be a market.

Supporting Start-up Founders With Their Pitch Deck

I had the opportunity to mentor 10 Nigerian start-ups to be attending GITEX in Dubai where they would have the opportunity to pitch their ideas to investors. I worked alongside with the Nigerian Information Technology Development Agency (NITDA) to help structure their pitch decks to meet up to the acceptable standards

The Pitch Structure

The pitch deck structure while different in the pieces put together as template by different organizations, still has the most essential ingredients in similarity to answer the questions in the minds of investors

 

These items in a pitch deck should be on each slide

  1. Cover Page

The cover page is a basic design that captures what the organization does. Usually the logo of the organization and the byline which serves as their value proposition to clients. The cover page should be very simple in design and text.

  1. Introduction

The introduction slide focuses on what introduced the problems and solution; It is the executive summary of what is to be expressed in the rest of the pitch desk. All the parts in a pitch deck should follow a simple rule “less is more”. The Pitch deck should have very limited words and portrays clarity.

  1. Problems

State the problems in very few sentences to capture what represents the current state of affairs as the challenges is concerned, bullet-points can also be used. Stating between 1-3 problems would serve this purpose.

  1. Solutions

The solution slides need to state the functions of your product or service as it addresses the problems you have stated. Try not to get into mentioning features as what is important here is how your product will benefit customers.

  1. Product Demo

If you are making a physical presentation, your product demo should be in a video of 30 seconds or less about how your product or service functions to provide the solution. If you do not have a video, then a pictorial view of images can also be used to represent this.

  1. Market Size

There are two approaches which are the top down or bottom up approaches. The top down approach is to find out the size of the market and how much of that size you think you can capture. I think the top down helps to be more realistic as what you hope to capture can either be expressed in years or in the lifetime of the business.

  1. Business Model

What would your business model be? Are your products going to sell for a particular price, would it be one that customers have to subscribe weekly, monthly or daily? This is what your business model represents. Some social media platform runs on a fermium model where users do not pay to use such platforms; however the platform then makes money from advertisers wanting to gain visibility from these number of users for their products or services.

  1. Competition

      List your competitors whether they are direct or indirect and mention how you are better than them. For example, the indirect competitor for carbonated drink is water and most bottling companies have succeeded in making their products a unique alternative to water by serving a refreshing taste. Mention here where makes you stand out.

  1. Go-to-Market

            When you launch a new product, it is necessary that a market plan exists; it helps to answer the question of how you would acquire customers. What steps are you going to take for customers to engage you? Would you have direct markets, use radio or television, social media, sponsored adverts, print etc to reach out to your targets.

  1. Team

      Your team information should display competence. Most start-ups have the product developer and the marketing officer. This can be seen in the likes of companies like Apple where Steve Jobs is the Chief Marketing Officer with communication prowess and ability to get customers to buy while Steve Wozniack was the developer. 2-3 team members can be the founder or co-founder and launch the start-up and add other team members as the organization grows.

 

  1. Milestones

Investors only want to make a contribution because they look forward to returns on their investment (RoI), no investor is your friend. Here is the section to show you already have traction in the form of partnerships, number of downloads and most importantly that you generate consistent cash flow and serving a good number of customers

  1. Fundraising Information

How much funding would you need and in what ways are you going to apply the funding you get and what this funding injection would generate within a specific timeframe. These are question you want to answer in this slide. Funding is usually needed for operational costs such as rent, staff salaries, and acquisition of office equipment, licenses or certifications and many more depending on the needs at the moment.

While receiving funding for your business is a great move, it can also lead to the death of start-ups as initial exposure to huge funding without experience or ability to have managed such funding could lead to instant gratification and reason why some start-ups have raised funding but are not profitable.

I suggest that a business proves through their financial statement to be profitable enough before seeking for funding in order to grow a sustainable business model.

Read Also:

NACCIMA Seeks Chinese Partnership on Industrial Parks

How to Validate Start-up Ideas With Design Thinking

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