Nigeria currently has the largest internet-using population in Africa based on a report by Nigerian Communications Commission (NCC) that there are over 98.3 million active internet users in the country. But despite this growth, a very insignificant proportion of SMEs have established their online presence to take advantage of this opportunity.
Despite the fact that there are 37 million MSMEs in Nigeria, only close to 100,000 .ng domains have been registered by 2018. Compared with South Africa with nearly 1.2 million .za domains for 5 million SMEs, the difference is clearly very big. The local domain penetration in South Africa is almost 24 percent, in the US it is close to 50 percent but in Nigeria, it is just 0.25 percent.
In this interview culled from Venturesafrica.com, Karan Singh, CEO of DomainKing Nigeria discussed the challenges faced by SMEs in Nigeria and how the firm is going to help change the situation. Excerpts
What are the challenges preventing Nigerian SMEs to come online?
Despite the increase in internet penetration in Nigeria, the domain penetration is still very low, owing to the number of challenges with lack of awareness at the top.
Firstly, a majority of small business owners think that having a website or online presence is not required for their business. They assume that websites are only meant for big brands or firms and they (small businesses) have not much to gain from being online.
Secondly, almost all the SMEs are managed by a single person or fewer than 4 employees and they lack the technical expertise to manage their websites. So, they consider creating an online presence to be an onerous task.
They think that buying a domain name, setting a business website and engaging on social media all are very complex. That makes Nigeria a do-it-for-me (DIFM) market where businesses look up to professionals for creating their websites rather a Do-It-Yourself (DIY) market like the USA or South Africa.
Lastly comes the financial consideration by business owners, who think that creating a website, business blog and social media profiles is very costly, so it is not for them. Small businesses usually have budget constraints and it is sometimes hard for them to put money aside to buy a domain name or web hosting for their business website. Therefore, a very few businesses end up taking the internet seriously to their build brand online.
What is DomainKing’s stand in Nigeria and how are you going to help SMEs?
At DomainKing.NG, we firmly believe in one basic ideology that we can only grow if our clients grow. That’s why we make every possible effort to help our clients achieve their online goals.
In every field of business, it is really important to know who really your clients are because only then you will be able to provide required products/services & technical support.
Since we alone cannot reach every small business in a short period of time, the best way to help small businesses grow and educate them to come online is to encourage professionals such as web designers/developers to reach more SMEs. They will have better reach to SMEs in their in their local region and can provide custom solutions as per the needs of every small entrepreneur or business.
To make sure that designers and developers are able to provide better solutions to end users, we back them with required set of tools, knowledge and really affordable services. We plan to organize, sponsor more design workshops, internships and conferences for web enthusiast in near future for collaborative growth for all.
For this, we are already providing the most affordable domain name registration and web hosting in Nigeria to reach more designers and web developers. Since high cost is the very first entry to the barrier for every business so if future demands, we will not step back from reducing our prices even further.
We are very sure that with our constant efforts and awareness conferences in future, along with our affordable services, we will be able to bring over 75,000 MSMEs online by the end of 2020.
Why do you think getting online is important for SMEs in Nigeria?
Nigeria is the largest economy in Africa and has the highest internet user base. This clearly cannot be ignored.
Currently, Nigerian E-commerce industry is valued at around $13 billion and experts in Nigerian financial services believe this value to reach $50 billion over the next 10 years. But there are very few local online stores apart from Jumia, Konga or Jiji, so this is a big chance for entrepreneurs to take advantage of this market gap.
Moreover, all this is happening owing to just half of the population’s access to the internet, out of which 88 percent are predicted to be potential online shoppers in future. These stats clearly show a massive opportunity not only for established business but also for budding entrepreneurs.
For instance, if you are a clothing brand or local clothes manufacturer then there is a big opportunity for you to sell your clothes online. Just to give you an example: there are close to 100,000 related searches on Google Nigeria every month for Ankara dresses, wedding dresses & related women’s dresses. And these are growing every day, so this is clearly a big opportunity for fashion designers & small dress manufacturers in Nigeria to showcase their brands, dresses online to these researchers & buyers. And this can bring in huge revenue growth for these businesses.
Moreover, these businesses can also leverage Social Media to market their products to a large number of users.
It is really important for today’s businesses to make sure that they are easily discoverable at every step. Online users are already searching for so many products & services every day, it is only a matter of getting you in front of them. So whether you are a new business or an entrepreneur looking to grow, it is really important for you to be online.