The Week in Geek™ – Sept. 10, 2011
In Kenya, Securing Cash on a Cell Phone
“It’s not that poor people lack the will to save, they lack the tools”. Local banks are rarely available to the rural poor. Those that are accessible often charge fees that discourage small savings. This often leaves the poor to horde cash at home where it can be stolen or prematurely pressured into the service of a pleading relative. But new services are allowing the mobile phone to replace the mattress and the bank. M-Pesa, the mobile money service by Kenya’s largest telecom firm, Safaricom, is now used by 70% of adult Kenyans. Only 4 million Kenyans have bank accounts, but 17 million use M-Pesa. By some measures, upwards of 11% of Kenya’s GDP flows through the service. And M-Pesa is apparently responsible for the largest share of profits that Safaricom returns to part-owner Vodafone (the British firm that also owns a big chunk of Verizon Wireless).
During a recent trip to Nairobi I was able to see the service in mainstream use throughout the beautiful and modern downtown area. Citizens use mobile phones to pay for just about everything including cab rides, groceries, utility bills, and school fees. Some employers even distribute salaries via M-Pesa. But while middle-class Kenyans have a technology many of us in the States would love to have, too – it’s the impact on the poor that’s most astonishing. Not only does M-Pesa help secure cash that would otherwise be vulnerably stashed under the proverbial mattress, it’s also a conduit for city-dwelling migrants to instantly send cash back to their villages – no more “bus trip money transfers” or risky mailed envelopes filled with cash. More than ¾ of the service’s customers use M-Pesa to save. Safaricom execs say they’ll make the service ‘bigger than cash’. $20 (and falling) mobile phones are an economic lubricant empowering millions. And by 2012, 1.7 billion of the unbanked poor worldwide will have a mobile phone.
Here’s how M-Pesa works – just go to one of nearly 30,000 M-Pesa agents to perform an initial cash deposit. To spend money – text a published account # along with the payment amount. You’ll get a text message receipt back and your account will be deducted. Want to receive money? It works the same way – you’ve got an account number you can share with others. Here’s a year old, but still very good video documentary of M-Pesa that faculty may want to share with class. And another longer video produced by Safaricom.
Personal note: It was my huge honor to speak at the recent AIBUMA conference in Nairobi, where Safaricom CEO Bob Collymore also gave an address. It’s important for those in the US and other mature economies to know that while we often see images of poverty in Kenya – slums and the rural poor – there is a vibrant, emerging economy taking root and a solid and growing middle class (African images that sadly, are still rarely seen in the west). In fact, downtown Nairobi, with its palm trees and modern buildings, looks at first glance like it might be part of downtown Los Angeles, and many of Nairobi’s modern shopping malls wouldn’t be out of place in any major US city. I also had an opportunity to talk with students at the University of Nairobi Business School campus in the bucolic Kabete area. There’s tremendous interest in entrepreneurship and I hastily put together a resource list of a small sampling of tech activity happening in the city. Investors note – a July/August visit would allow you not only to check out the exciting, emerging tech scene, but also take in a Safari during “The Great Migration” – about a five hour drive away. Combine the justifiable business expense with a family vacation! For the curious, I’ve posted my own pics as a Google Plus photo album (I was in the Mara two nights & three days – despite the refugee crisis on the north border, there is thankfully no drought anywhere near the Mara or Kenya’s capital). Nothing’s certain yet, but I do hope to work to create a Boston College “Tech in Emerging Markets” field study to bring our students to Nairobi, perhaps in the summer of 2013.
HomePlus Subway Virtual Store
Speaking of global tech innovation, now let’s visit S. Korea. Tesco’s S. Korean brand, HomePlus, looked to compete with much larger E-Mart without increasing the number of stores. The solution is ruthlessly cool, as this video shows. The firm posted virtual displays in Korean subway stations – billboards that show actual merchandise. Users shop on their way through the station, scanning QR codes with their mobile phones. Online purchases are then scheduled for delivery when shoppers arrive home. Mobile phones and m-commerce mean the billboard can be the store. HomePlus online sales are up 130% in three months, registered users are up 76%, and the firm snagging the top spot in online sales and narrowing the overall gap with E-Mart.
How Social Media Affects Content Relevance in Search
Google’s PageRank search results ranking algorithm is largely based on inbound links – the more websites that link to a web page, the higher that page will appear in Google rankings. But now social media is fueling ranking, as well. While marketers have had to scramble to master SEO this past decade, they’d best beef up social skills, too, otherwise their brands may fall off the search engine radar. Web users now share 30 billion pieces of content on Facebook and tweet 5 billion times a month. And about a quarter of that includes links to other content. Although the major search engines remain secretive about the inner workings of their search rankings, the two largest search engines – Google and Bing, now fess up that search results are positively affected by social signals such as tweets, Facebook Likes, and Google +1’s. One recent study of Google results showed that “tweets and Google+ shares dramatically affected the rank of new, previously unindexed content. The results in most cases were nearly instant.”
The developments don’t just mean that marketers need a new skill – they also underscore the strategic importance of social media to Google. Earlier this year Google was skewered in the press for having less relevant search results that were increasingly polluted by so-called “content farms” like about.com – firms that create ad-filled pages with weak content but that are optimized to rank highly in Google searches. But social can potentially counteract those that try to game the system – likes from verifiable social media accounts and especially from your friends or those with a similar surfing profile – could help surface the links you’re likely to want most – all while bypassing the “content farm spammers”. That’s why Google needs G+ to be successful, and why Facebook and Twitter may hold valuable trump cards in the evolution of search. Oh yes, and kindly “like” Gallaugher.com at the top of the home page, and do consider +1-ing it in Google search.
Social Power and the Coming Corporate Revolution
On a somewhat related note, David Kirkpatrick makes many points in Forbes that I share with my students (and uses many of the same examples) – Social (combined with mobile) will charge the current generation of managers to be more honest, show more humility, behave with a higher ethical bar, show greater attention to customer service, and focus more on employee satisfaction than their predecessors. And on top of that they do so with a vastly more complex business environment – one with far flung global partners, markets, and rivals. The senior manager that doesn’t understand the freight train that is mobile and social will almost certainly be steamrolled.
In A Tough Labor Market, Software Developers Wanted
“Everyone in the room wanted to talk to me”. So says a recent tech grad at a university career fair in this Curt Nickisch WBUR broadcast. Despite the down economy, the Boston-area, and many other US cities, don’t have enough technologists to go around. And just about every other major discipline demands more tech skills. Marketers need to know SEO, social media, CRM, and “big data” analytics, finance folks bound for Wall Street need to understand tech to value M&A deals & IPOs, accounting firms are beefing up their tech hiring, operations can’t be rewired without tech, LinkedIn and other social media skills are the new HR toolkit, and the geeks are clearly at the strategist table. Geek up new college student. Your future demands it!
United’s iPad Deployment Lets Pilots Shed Excess Baggage
United Airlines, will give iPads to some 11,000 pilots. The move allows the firm to replace the roughly 38 pounds of manuals, charts and logbooks on each flight with a single 1.5 pound tablet. Trees rejoice – the move will save nearly 16 million sheets of paper. Even more significantly the reduced rate will also shave some 326,000 gallons from United’s yearly jet fuel bill.