Sefik Bagdadioglu, Kaymu: "There is a lot of opportunity in emerging countries"

Could you briefly describe Kaymu’s business model?

Kaymu is an online marketplace with a social and community focus. Our aim is to build the largest online shopping community through a safe and engaging platform that enables buyers and sellers to meet and make great deals on new and used products. In this process, we act as a mediator in the transaction, providing customer service and logistics support. We enable entrepreneurs to grow their businesses by selling online and we provide access to all sorts of buyers through having the widest and most diverse range of products.

Kaymu presents itself as an online marketplace operating in emerging countries on three continents, Asia, Africa and Europe. Why do you operate in emerging countries?

There is a lot of opportunity in emerging countries; overall they are growing faster than the world average and mobile and internet penetration and literacy are increasing. For a long time, businesses did not focus their attention on keeping up with that development and meeting the expectations of the new sophisticated buyers and grooming rising entrepreneurs. Kaymu saw this opportunity in emerging countries and we wanted to bridge the gap between offline and online markets by working with the emerging talent in small and medium-sized enterprises that is so unique to emerging markets.

Could you make a breakdown, with statistics, of the most used payment channels preferred by customers in purchasing products from retailers and businesses on your marketplace?

• > 90% of customers prefer to pay on delivery
• < 6% of customers pay through a bank transfer or other forms of non-card prepayment
• < 3% of customers pay online through a debit or credit card

Mobile money solutions are not yet live on the website but we do expect that in the future, they will make up a large share of the transactions. As for the present statistics, the numbers are a true reflection of buyers’ attitude and distrust since online transactions are relatively new in the countries where we operate. Buyers tend to prefer the pay on delivery option because it gives them more flexibility in changing their mind or ensuring that their product is in their hands, as they saw it on the website, before they commit to purchasing it. Over time, we expect the numbers to change as people become more accustomed to ecommerce.

Could you list some third party business partners you are partnered with and for which purposes, say a PSP for payment methods implementation?

We have partnered with different players across the continent to ensure that the needs of every market are met. We are partnered with Interswitch for online payments in Nigeria, and a variety of mobile money partners across the continent such as MTN API and Tigo Cash in Ghana and Rwanda, Airtel Money in Kenya and Tanzania, MPesa and Mkesh in Mozambique.

What product categories are the most purchased on Kaymu marketplace?

Fashion, jewellery, and electronics are our most popular product categories making up over 50% of our transactions. But, purchasing habits vary greatly according to seasons, trends, holidays, and special occasions, which we integrate in our promotions. These three categories compete on popularity throughout the year, with mobile phones dominating the first quarter historically, fashion trending in the second quarter, and jewellery gaining popularity next to perfumes around the end of year holidays.

There are monthly variables as well; for instance, around payday – in the last week of the month— we find that buyers tend to invest in higher value items such as mobile phones and tablets or home appliances.

What countries, in which you are present, are most adaptable to online shopping and what would be the main reasons behind this?

Nigeria, as the largest African economy, is one of the most promising markets for us because of the growing middle class and the rapid increase in mobile and internet usage every day. Internet penetration is above 38% in Nigeria and grows year by year, especially through mobile usage, which makes it very adaptable to online shopping.

In fact, over 60% of our transactions happen through the mobile app. There are already some big players here and more online businesses are emerging every day. Nigeria is a very large country, with an estimated population of 190 million people which means online shopping has the power to create an unprecedented convenience for people across the nation.

What services do you provide to merchants and businesses selling on your marketplace and what functionalities are enabled on subscription?

Our sellers get access to a dashboard that enables them to manage their orders and keep track of their sales. Through the website, they also get to use a portal that allows them to communicate with buyers. Kaymu is really unique in how interactive our website is – buyers can follow sellers to keep up with their new products, they can like products, or chat with the sellers. This gives the marketplace a much more social feel, which makes for a better experience for both sellers and buyers.

Sellers get assigned to an account manager, who serves as a sales consultant and a resource for on-boarding them on to the site. We also offer trainings on different topics relating to succeeding on the platform and leveraging social media to increase sales. This is part of our Kaymu Varsity Program, a community initiative that runs at Kaymu Village, our offline hub and meeting place for buyers and sellers. Sellers get connected to our logistics partners, who provide them with competitive shipping rates, seamless deliveries, tracking tools, and ubiquitous drop off hubs.

We have also recently began offering Value Added Services to assist merchants with assortment management and order fulfilment. Sellers can sign up for these services at a small additional charge and Kaymu will take care of communications with the buyer, parcel pick-ups through our logistics partners, and search engine optimisation for all product descriptions.

Do you plan to expand in other markets, say developed one, in the near future?

Our current focus is only on emerging markets. We want to grow our existing businesses and perfect our operations in these markets before expanding elsewhere.

About Sefik Bagdadioglu

Sefik Bagdadioglu has served as the Managing Director for Nigeria—Kaymu’s largest market—since August 2015. An avid economist and entrepreneur, Sefik comes from a background in management consulting and experience leading East African startups.

About Kaymu

Kaymu is the number one social online marketplace in emerging countries, present in over 20 countries in Africa, Asia, and Europe. Kaymu is a part of the Africa Internet Group, the leading internet group on the continent and a joint venture of Rocket Internet, MTN and Millicom.