Digital Adoption in Africa: Challenges, trends and considerations

The Challenge:

Many African start-ups can relate to the struggle of convincing people that using their solution is more effective than picking up a phone or using pen and paper. The acquisition of customers on any digital solution will quite often come with costs. Educating and sensitising a product within the market, establishing offline customer touch-points and subsidising products in order to attract reluctant adopters has a cost associated. This greatly challenges the expectation that tech start-ups usually design products that can rapidly serve large markets while enjoying economies of scale.

The digital adoption lag in Africa makes it more difficult for start-ups to reduce the cost of serving additional customers as they expand. For African start-ups, growth is often hindered by operational friction and sometimes the ability to fully leverage on the efficiencies of technology is limited.

As someone who is immersed in the tech world, I am often reminded of the realities of the digital divide, this is especially true when interacting with tech solutions for everyday use. For instance, I prefer to use my telco app as opposed to the SIM toolkit when I want to buy airtime and access mobile money services. There are fewer steps required to make a transaction, and I can easily access my contacts when sending money which reduce the chance of user-error before completing a transaction. I remember once attempting to make a payment using my app at a supermarket. I must have run out of bundles because I was unable to initiate any transaction. It took me a while to figure this out and so I struggled with my phone before finally deciding to use the SIM toolkit. The pressure to complete the transaction is usually so high in this kind of situation. I felt even more pressured when some behind me honestly asked:

“Why bother with these apps? I have never understood! They take so much data, every time they want you to download a new one and they eat up storage. Now look these ma-apps are leaving you stranded!”

I could see the rest of the queue almost nodding in agreement and I wasn’t in opposition. Data in Africa is very expensive. In some cases data can account for 18-60% of minimum wages. Overcoming the digital lag is important, but this is very difficult without first tackling the financial burden.

How much does 1GB of data cost?

infographic showing the cost of 1GB of data

Source: Visual Capitalist, The Cost of 1GB of Data in Every Country

Besides the reality of low internet and smartphone penetration, African start-ups have to be sensitive to the cost of data when building a consumer facing product. Users are concerned that apps consume data, and money from their pocket even if it is working in background mode. Additionally, many users encounter issues regarding limited storage capacity, especially since most people use low-cost mobile devices.

What’s important to a consumer when they download an app?

digital adoption decision making process

Source: Digest Africa, The biggest challenge every app start-up in Africa has, but doesn’t yet know


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The Considerations:

One of the reasons perhaps, that SMS-based solutions seem to appeal to customers is rooted in their key concerns; cost of data, and space. The ease of web browsing and sending SMS messages may be more inconvenient than installing a mobile app. But many customers are more receptive to a service when there is little to no cost associated with use (even if the cost isn’t directly associated).

Start-up founders looking to drive the adoption of their solution should bear this in mind. If the solution is consumer facing, prioritising the development of more cost-effective channels (such as USSD, SMS or light web-based apps) should be an important requirement. In the case that a fully-functioning mobile app offering a complete experience, it is important to ensure that the app is very light and cost-effective. Product teams in this context would also need to be considerate of any negative user-feedback or requirements, when testing any changes and new features. The popular “ship code faster” motto ought to be implemented with “a pinch of salt” within an African context. Applying a reiterative experimental approach without carefully considering consumers’ sensitivity to changes may negatively affect efforts to on-board customers.

Even after we account for the cost barriers to digital adoption, customers can still be very hesitant to use a tech-enabled solution. Some customers can be hesitant when using fully-digital solutions especially when they feel that they need human-interaction to establish trust. Some banks and telco operators have already faced this reality when trying to drive the adoption of mobile banking. The adoption of digital banking channels, for example, was largely driven by agents who would serve as customer offline touch-points.

Old habits die hard! African start-ups are not exempted from this behavioural resistance. There is pressure to ensure that interaction with a tech product leads to trust, especially on first try. This can be facilitated by having offline touch-points such as agents or providing additional support during the on-boarding process. Nevertheless, digital on-boarding remains a priority as offline channels are difficult to track and scale. In this case, explicit economic incentives have the potential to drive digital adoption (e.g. promotions, raffles or cashback offers). Messaging around cost-saving and value-add can be crucial when trying to penetrate price-sensitive markets across the continent.


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Final thoughts:

Having considered economic and behavioural barriers to digital adoption, start-ups still face the challenge of finding product-market fit within their respective sectors. Coordinated efforts to push for digital adoption would support the tech ecosystem seeing that consumers can benefit from the network effects of digital platforms, allowing for a multiplier effect on adoption. With this in mind, it may be worthwhile for early stage start-ups to coordinate the development and messaging of simple, accessible and affordable digital solutions.

By Wanjiku Kimani

Venture Partner at The Baobab Network


The Baobab Network Accelerator Applications Banner


Digital Adoption in Africa: Challenges, trends and considerations

The Challenge:

Many African start-ups can relate to the struggle of convincing people that using their solution is more effective than picking up a phone or using pen and paper. The acquisition of customers on any digital solution will quite often come with costs. Educating and sensitising a product within the market, establishing offline customer touch-points and subsidising products in order to attract reluctant adopters has a cost associated. This greatly challenges the expectation that tech start-ups usually design products that can rapidly serve large markets while enjoying economies of scale.

The digital adoption lag in Africa makes it more difficult for start-ups to reduce the cost of serving additional customers as they expand. For African start-ups, growth is often hindered by operational friction and sometimes the ability to fully leverage on the efficiencies of technology is limited.

As someone who is immersed in the tech world, I am often reminded of the realities of the digital divide, this is especially true when interacting with tech solutions for everyday use. For instance, I prefer to use my telco app as opposed to the SIM toolkit when I want to buy airtime and access mobile money services. There are fewer steps required to make a transaction, and I can easily access my contacts when sending money which reduce the chance of user-error before completing a transaction. I remember once attempting to make a payment using my app at a supermarket. I must have run out of bundles because I was unable to initiate any transaction. It took me a while to figure this out and so I struggled with my phone before finally deciding to use the SIM toolkit. The pressure to complete the transaction is usually so high in this kind of situation. I felt even more pressured when some behind me honestly asked:

“Why bother with these apps? I have never understood! They take so much data, every time they want you to download a new one and they eat up storage. Now look these ma-apps are leaving you stranded!”

I could see the rest of the queue almost nodding in agreement and I wasn’t in opposition. Data in Africa is very expensive. In some cases data can account for 18-60% of minimum wages. Overcoming the digital lag is important, but this is very difficult without first tackling the financial burden.

How much does 1GB of data cost?

infographic showing the cost of 1GB of data

Source: Visual Capitalist, The Cost of 1GB of Data in Every Country

Besides the reality of low internet and smartphone penetration, African start-ups have to be sensitive to the cost of data when building a consumer facing product. Users are concerned that apps consume data, and money from their pocket even if it is working in background mode. Additionally, many users encounter issues regarding limited storage capacity, especially since most people use low-cost mobile devices.

What’s important to a consumer when they download an app?

digital adoption decision making process

Source: Digest Africa, The biggest challenge every app start-up in Africa has, but doesn’t yet know


Want market insights delivered direct to your inbox?

Sign-up to our free weekly email:


The Considerations:

One of the reasons perhaps, that SMS-based solutions seem to appeal to customers is rooted in their key concerns; cost of data, and space. The ease of web browsing and sending SMS messages may be more inconvenient than installing a mobile app. But many customers are more receptive to a service when there is little to no cost associated with use (even if the cost isn’t directly associated).

Start-up founders looking to drive the adoption of their solution should bear this in mind. If the solution is consumer facing, prioritising the development of more cost-effective channels (such as USSD, SMS or light web-based apps) should be an important requirement. In the case that a fully-functioning mobile app offering a complete experience, it is important to ensure that the app is very light and cost-effective. Product teams in this context would also need to be considerate of any negative user-feedback or requirements, when testing any changes and new features. The popular “ship code faster” motto ought to be implemented with “a pinch of salt” within an African context. Applying a reiterative experimental approach without carefully considering consumers’ sensitivity to changes may negatively affect efforts to on-board customers.

Even after we account for the cost barriers to digital adoption, customers can still be very hesitant to use a tech-enabled solution. Some customers can be hesitant when using fully-digital solutions especially when they feel that they need human-interaction to establish trust. Some banks and telco operators have already faced this reality when trying to drive the adoption of mobile banking. The adoption of digital banking channels, for example, was largely driven by agents who would serve as customer offline touch-points.

Old habits die hard! African start-ups are not exempted from this behavioural resistance. There is pressure to ensure that interaction with a tech product leads to trust, especially on first try. This can be facilitated by having offline touch-points such as agents or providing additional support during the on-boarding process. Nevertheless, digital on-boarding remains a priority as offline channels are difficult to track and scale. In this case, explicit economic incentives have the potential to drive digital adoption (e.g. promotions, raffles or cashback offers). Messaging around cost-saving and value-add can be crucial when trying to penetrate price-sensitive markets across the continent.


The Baobab Network Accelerator Application Banner


Final thoughts:

Having considered economic and behavioural barriers to digital adoption, start-ups still face the challenge of finding product-market fit within their respective sectors. Coordinated efforts to push for digital adoption would support the tech ecosystem seeing that consumers can benefit from the network effects of digital platforms, allowing for a multiplier effect on adoption. With this in mind, it may be worthwhile for early stage start-ups to coordinate the development and messaging of simple, accessible and affordable digital solutions.

By Wanjiku Kimani

Venture Partner at The Baobab Network


The Baobab Network Accelerator Applications Banner