Rupu offers customers discounts on goods and services sourced from over 1,500 merchants. It focuses on seven categories – travel, beauty, fashion, food and drinks, home and living, events and activities, and electronics.
But the company, sometimes compared with Groupon, is changing its focus from merely offering deals and discounts, to building customer relationships and selling higher quality curated products and services.
Alex Scholz, Rupu’s head of e-commerce, says the strategy is influenced by the experiences and lessons of the last five years. Research has shown its customers are increasingly interested in services and non-tangible goods like events and activities. Buyers are also demanding quality as opposed to just the cheapest price.
“We realised that spending more time on building a very dedicated customer relations team, or a very strong merchant relations team had more impact on our business and customer satisfaction rating. It is a better fit for this market than simply offering deals. Taking the deal approach, the Groupon approach, is a very western strategy. When it comes to this market, you are really looking at people who are used to getting that very personalised level of service,” explains Scholz.
“We also realised if you want the best quality or experience you can sometimes get limited by ‘forcing’ a deal and discount onto it. So for example, if you want to go bungee jumping it may be a little bit [hard to find a service provider] in Nairobi – but we bring it to you. We go through the stress of making sure we find the best things you can do in the city, and the best experiences that you can have. The deal and discount is not the core part of that focus. The focus is that we make sure you get the best possible packages,” Scholz adds.
Limited product range
One of the reasons why Rupu stocks a relatively small number of products compared to other e-commerce platforms is to be able to maintain communication with individual shoppers and merchants.
“We don’t want to have 5,000 items on the site because doing this would require us to get a team 10 times the size of the one we have now. I doubt you can win the game just through pure quantity. You can’t have 5,000 massage parlours on your site and make sure that each is providing a quality service and customers are happy. It would be an operational headache,” Scholz explains.
“We are also in an emerging market so we want to grow with it. We don’t want to have on our site 10,000 items that are not selling. We have tailored the platform and built it based on what works, as opposed to going for a ‘let’s just go everywhere approach’. We don’t want to throw pasta on the wall and see if it sticks.”
Less competition in services
Rupu’s head of marketing, Cedric Nzomo, says the platform has not faced strong competition in the services category since most local e-commerce platforms largely sell tangible products.
Although Rupu continues to offer discounts, this is tied to some added value. One could, for example, buy a game drive at an affordable cost, but also get a bottle of champagne as an add-on.
“We are never going to get to a point of marking up or playing with our prices just so we can make money off the customer. But at the same time we support local businesses. We want to push the little spa to get to that level where it can build the same type of customer share as a big merchant. Both the customer and merchant should get something that is worthwhile for them.”
Rupu has proved to be popular among female buyers who make up the majority of its clients. This is partly because of the platform’s beauty and fashion offerings.
A ‘fascinating’ e-commerce market
“The business has grown dramatically over the last five years,” says Scholz. “The market in Kenya has been extremely fascinating to watch. More e-commerce shops have set up – which is a good indication that there is a lot of interest in online buying. The other thing that has changed a little bit is the level of customer awareness. There is also a larger customer base. The growth of internet users is phenomenal.”
But five years on, dealing with buyers that are not accustomed to transacting online is still a challenge. Customers tend to call or email Rupu’s customer relations team seeking assistance with the purchasing process.
“Our team has to call every single buyer. I am in the loop of all emails that we get from customers and sometimes they have really interesting questions. But it helps us understand how we can adapt the platform so people know exactly what they need to do in order to purchase,” says Nzomo.