GAJAH ANNUAL REPORT 2015 | 1

THE GROWTH OF THE SMARTPHONE MARKET IN KENYA

Download the whitepaper: www.jumia.co.ke/blog

AFRICA’S #1 ONLINE RETAILER

13COUNTRIES

3000EMPLOYEES

OWN WAREHOUSE OWN DELIVERY FLEET OWN CALL CENTER

END TO END CUSTOMER FOCUS

Putting the customer first.

FLEXIBLE PAYMENT FREE PICK-UP POINTS FREE 7-DAY RETURNS

AFRICA’S #1 ONLINE RETAILER

2014 – Our year of Hypergrowth2013 – Jumia wins world retail awards

Best new retail launch of the year

Dec-13

Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14Jul-1

4

Aug-14

Sep-14

Oct-14

Nov-14

Dec-14

Jan-15

Feb-15

Orders Shipped

Orders Shipped

+900%

AFRICA’S #1 ONLINE RETAILER

2015 – The trend continues2013 – Jumia wins world retail awards

Best new retail launch of the year Dec-14 Jan-15 Feb-15 Mar-15 Apr-15

Orders shipped

+100%

Become the launch pad forbrands existing in or entering Africa

WHERE WE ARE HEADING

One stop shop for brands

Africa-wide network and distribution

Largest online and offline retailer

THE KENYAN ECONOMIC LANDSCAPE

Economic Growth

73% of all internet users in LSM8+

5.7%

‘13 ‘14 ‘15

5.3%

6.5%

3rd fastest growing economy in the world

LSM 5-7: 29%

LSM 8-11: 17%

LSM 12+:5%

LSM 1-2: 13%

LSM 3-4: 36%

Middle Class

THE KENYAN DIGITALLANDSCAPE

Internet penetration

World: 42%

Africa: 26%

Kenya: 58%

Mobile penetration

World: 51%

Africa: 79%

Kenya: 83%

Social Media

World: 23%

Africa: 7%

Kenya: 19%

THE SMARTPHONE MARKET

Units sold

2015

2011

7%

58%

Average price

KSh15,000

KSh10,000

Nairobi sales

70%

43%

Brands

22

15

INCREASING COMPETITION

Competition among device makers is the single biggest factor driving the growth• New entrants• Cheaper models by incumbents

# brands capturing 70% of market

% smartphone sales under $100 in MEA

5%2013 20%2014

2011

4 2015

7

SURVEY OF SMARTPHONE USERS

576 Respondents

Smartphone owner

Knowledgeable about e-commerce 64%

36%30%

59%

10%

2%

18-24

25-34 45+

35-44

When did people buy their first smartphone

4% 35% 54% 7%

2004 - 2007

2008 - 2011

2012- 2014

2015

FIRST SMARTPHONE

7%

20%

24%

49%

LAST SMARTPHONE

Less than 6 months ago

6 months – 1 year ago

2 years +

1 – 2 years

LIFETIME SMARTPHONE OWNERSHIP

35-4418-24 25-34

3.34

3.053.22

2.53

2.69

1.95

2.86

Young people are willing to invest to keep up with the latest technology trends

Men in older demographic more open to new technology than women

SMARTPHONE ACTIVITIES

69%

44%

78%

33%

49% 45%

26%

57%75%

69%

25%

E-MAILS

NEWS/CURRENT AFFAIRS

CHATTING/SOCIAL NETWORKING

READINGBOOKS/ ARTICLES

ENTERTAINMENT/GAMES/ MUSIC/ VIDEO

CHECK WEATHER / SPORTS SCORES/ STOCK MARKET

ACADEMICPURPOSES

ONLINE SHOPPING ONLINE BANKING CALLING GENERAL SURFING/BROWSING

BIGGEST FRUSTRATIONS

DATA LIMITS

MEMORY STORAGE

BATTERY LIFE

SERVICE / RECEPTION

SMALL SCREEN SIZE

DATA PRIVACY

PROGRAM CRASH

CAMERA QUALITY

29%

47%

78%

16%

19%

13%

36%

30%

TOP 3PURCHASE DRIVERS

CAMERA

BATTERY

BRAND

59%

72%

44%

56%

MEMORY

SIZE33%

56% PRICE

KEY TAKEAWAY

With Telcos#JumiaMobileWeek + Airtel: Free 6GB credit for all phones

With app companiesPre-install relevant apps

With retailers6 top brands + Jumia.co.ke, who invests in marketing & delivers to customer on brands’ behalf

Quality is king. Kenyans are willing to switch brand loyalty if they can find better features and service at a cheaper price elsewhere. Brands must get creative to win the price war through partnerships.