Eskimi shoots to 2.5 million subscribers

It came out of nowhere – Low-end, mobile social network Eskimi shoots to 2.5 million subscribers

February 11, 2012
Eskimi-mobile

The speed with which Facebook grew in Africa was startling but the story is now well-known. Latvian social network Eskimi is designed for low-end handset users and in a little over 18 months it has gone from nothing to 2.5 million users. Anyone who believes that mobile content is important has to understand why this has happened. Russell Southwood picks over the bones with Vytas Paukstys, CEO, Eskimi and Nigerian Ayo Alli who has taken on the promotion of the site.

There’s a cycle of events before the content moment arrives. International fibre connections have to be in place: content and apps don’t grow on satellite bandwidth. Wholesale bandwidth prices have to come down so that retail prices for the individual user come down: operators have to stop selling shortage. Then international brands like Google, Wikipedia, Facebook and Twitter begin to grow. From research we have done elsewhere, this is generally followed by local versions of the international brands, particularly in larger markets.

The Eskimi story is one of a social network that didn’t come from the usual places and chose to break out in emerging markets rather than the crowded European and North American markets. Also as with the “iTunes for Africa” site, Spinlet (which formally launches at Mobile Web East Africa next week), this is a collaboration between a small European country and Nigeria. The trading centre of gravity in the world is slowly beginning to tip on its axis.

According to VytasPaukstys, CEO, Eskimi:”We started experimenting in the Baltics and it went great there. So we decided to go international and do test marketing elsewhere in the world. We started in Asia and then went to Africa. We focused on four countries: South Africa, Nigeria, Kenya and Ghana.”

All this has taken it to the point where at the beginning of November 2011, 1.7 m of its 3 m global users were Nigerian. But also use at that point in other African countries was also growing: 250,000 registered users in Ghana, 35,000 users in Kenya and over 30,000 in Namibia. Now it has 5 million global users, of which half are in Nigeria. Overall, Africa now has 1 million users. In other words, it is gaining critical mass in Ghana and other places, making it more than a one-hit, one country wonder.

Eskimi

Eskimi

Eskimi is a low-end, mobile web product and it is building an Android app but it believes, it’s too early for a smartphone application. The pattern of use must be reassuring for Nokia as in November 2011, 73% were using the Opera Mini browser which is most frequently found on its handsets. At this point, 90% of use is on Opera Mini or the proprietary browser on the handset. Critical mass needs a wide potential user base as not everyone who has the right phone will use the product or service.

So if there are say 1 million smartphone users, only 10-30% may use a particular service and only a smaller percentage use it regularly(see look and feel in graphic) Also this year, Eskimi will go out to local developers to develops to help create more services around the platform.

What are they all using it for? What a small number of them used to lurk in cyber-cafes and do: discovering new friends, messaging, public chat, fan boards, picture sharing and dating tools and games. In other words, flirting, dating, romance and much, much more. 86% of them in Nigeria are in the social category that moves technology change across Africa, 18-34 year olds. You can guess that these people are less deferential and probably more in a hurry than their parents. Usually these things are heavily focused on the capital or the main city but not Eskimi. Only 32% of its users are in Lagos, the majority of the rest being spread across seven cities.

Part of its growth phenomenon is down to how it was marketed. In the early days, it paid special attention to feedback from users, fine-tuning the product at that stage. And although it has spread throughout Africa, largely by word of mouth, it has offered incentives for users to write to their friends and connect with them, giving them some of the virtual currency available to users.

The business model for the site is two-fold: sale of virtual currency (purchased through operator and which it shares with them) and advertising. For the latter, the 18-34 year old audience is attractive and can be highly targeted. Where African media is researched, the methodology is often open to question and where it is not, who knows how many people actually listen to, watch or read it?

Eskimi knows enough about its list users to be able to target very precisely and it is getting a 20% response rate on those targeted lists. It can also trade its virtual currency to advertisers to use in competition promotion and for other incentives.

Elsewhere the breakdown of revenues has been half from virtual currency and half from advertising revenues. In Africa, this has been more like 20% virtual currency and 80% advertising. But Eskimi’sPaukstys is not just chasing the traditional advertisers:”Africa’s at the media creation stage. Classifieds, business listings, news portals, etc are all growing. Revenues will come from these media creation businesses.” Media creation? Uh? Think people like Mocality and Jobberman who have to also get to critical mass for their businesses to succeed. Another source of revenue will be mobile money operators: there are ten licences in Nigeria, making their climb to critical mass a daunting task without a carefully focused marketing platform. It can also provide a platform to do the kind of research about media consumers that is currently sorely lacking.

So in the cycle of events described at the beginning of this article, things are still largely at the stage of the arrival of international brands. Brands like Flickr and Tumblr have yet to make a noticeable impact on the continent. But local entrepreneurs – particularly in the larger markets need to think about what will work (probably in a vernacular language) that is not just a “me-too” product and developers who are all hyped up about smartphone apps need to think about whether they might be doing something more responsive to the market (most likely on feature phones) in the short to medium term.

Source: Balancingact-Africa

Tags: Eskimi, Headline

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