The African data gap: What it means for business

With the buzz on U.S. President Barack Obama’s Power Africa initiative, the NASA composite map showing the world’s haves and have-nots of electricity has become an iconic image. The U.S. is brightly lit, as is Europe and parts of Asia. India, Indonesia and Brazil sparkle in the nighttime map. And then there is Africa, nearly dark but for a smattering of lights around South Africa, Lagos and the Mediterranean shores. At last, the world has finally woken up to the pressing need for electricity in Africa.

Now here’s the next frontier, data.

I suspect if you were to create a map of data sets throughout the world, it would look much like the electricity map — data overload in the U.S., Europe and parts of Asia, yet a mere sprinkling around North Africa, South Africa, Lagos and Kenya.

It’s easy to look at the data shortage and say it doesn’t matter, especially when there are so many other pressing needs like education, health and job creation, but that’s the shortsighted view. Data matters enormously.

One of the biggest impediments to investment is lack of information. With information, investor confidence grows. With confident investors, money flows and that’s when real, sustainable development happens. Information is power, but ask any trade minister trying to promote his or her country without adequate data, and you will understand lack of information is powerlessness.

Info gap solved: Harnessing the mobile revolution

Gathering data via traditional means can be difficult in Africa. Remote populations, lack of infrastructure, paucity of landlines and insecurity add up to an extremely challenging environment for traditional information gathering. Like many challenges, sometimes the answer lies in finding another way.

Enter the greatest African game changer of our times, the cellphone.

In the late 1990s, cellphones came to Africa and revolutionized the continent. Suddenly, Africans could communicate — with each other and with the world. In less than 10 years, there was a new revolution, only now it was no longer about making phone calls; it was all about the apps. A whole universe opened up with e-health, e-government, e-learning and, best of all, mobile banking.

Fast forward another decade to today, and we are on the verge of another revolution. It’s no longer just about an individual being able to make calls or what an individual can do with his phone. Today, it’s all about the aggregate. With cellphones, it’s now possible to gather individual African’s views, hopes and habits, and aggregate them to create accurate and reliable data in near real time. This is actionable information that can drive investment, create jobs and fuel development.

Want to know what Africans think? Snd a TXT msg

At GeoPoll, our part of this new data paradigm is surveying populations through cellphones, using text messages, voice recordings and Web applications. Like all great ventures, we started in 2010 with a bang: polling 140,000 people in the Democratic Republic of the Congo. And with results in 48 hours.

With an estimated 85 percent of Africans owning or having access to cellphones, it has become the easiest, quickest, most cost-effective way to reach populations throughout the continent.

Using cellphones allows us to access traditionally hard-to-reach areas, including regions that are remote or insecure, to poll people repeatedly to see changes over time and to gather data in near real time.

From our database of more than 150 million users we are able to collect real-time data that can help businesses, organizations and governments make better-informed decisions. When you consider that almost all development ministers in Africa are working with data that is at least 12 weeks out of date, real-time data could be a game changer.

New data, new opportunities

What can data show us? A lot and with astonishing granularity — even at a grass-roots level. Data can be the ultimate myth buster, and for a region like Africa where myths, stereotypes and wrong-headed assumptions abound, myth busting is sorely needed.

The U.S. State Department recently issued a warning on travel to Kenya, but how do Kenyans feel? Rather optimistic, according to a recent GeoPoll survey, with 54 percent saying they believe the economy will improve over the next 90 days. Seventy-six percent say they are spending more money this year than last, with 52 percent reporting spending “significantly more.”

What drives their buying decisions? For such an impoverished continent one would assume it must be price. That’s true for 32 percent of respondents in Kenya, but price is trumped by a surprising 53 percent who say quality is their top factor.

In a similar poll in Nigeria, three times as many people chose quality over price as the key driver of their buying decisions. Consumer optimism is alive and well in Nigeria: Despite global news being flooded with stories on Boko Haram, 59 percent believed the economy would improve over the next 90 days.

It used to be that Africans far preferred imported goods, seeing products made in Africa as being of lower quality, but that may be changing. Forty-seven percent of Nigerians prefer goods made in Nigeria. In Kenya, 57 percent felt the same about Kenyan-made goods.

Perhaps most astounding, 44 percent of respondents in Kenya and a whopping 60 percent of Nigerians said during their most recent shopping excursions they did not find what they were looking for. That’s a business opportunity! Kenya and Nigeria are among Africa’s most competitive business environments, and yet the figures show they are still unsaturated markets that are ripe for investors bringing to market products that are of better quality, lower-priced and widely available.

Other polls uncover huge opportunities for investment. Only 25 percent of Kenyans rated traffic as “very high” volume, and yet 70 percent would be willing to pay a toll for roads with less traffic. Are they as willing to pay for more reliable electricity?  Probably so, as 41 percent reported having electronics damaged by power surges or outages in the past year.

Information is power

A top CEO used to say that U.S. manufacturers couldn’t keep selling to just 15 percent of the world. Quite true, but that other 85 percent has become far more sophisticated and complex. Africans now have choices and can raise capital, source goods and fund projects from a wide array of options. Understanding these markets is essential. More than ever, information is power.

Watch the sixth episode of IGD’s “Changing Perceptions” video series here. To learn more about the “Changing Perceptions through Digital Storytelling” project, click here.

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