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This report provides an overview of the Lighting Africa program and its efforts to support the development of the off-grid lighting market in Africa. It includes information on market research findings, consumer needs, and product testing results.
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LIGHTING DEVICES TEST RESULTS Kenya Results June 2009
What is Lighting Africa? Lighting Africais a World Bank – IFC initiative aimed at supporting the global lighting industry to catalyze a robust market for off-grid lighting products tailored to the needs of African consumers. The Program’s mission is to make affordable, environmentally sustainable, durable, and safe lighting available to the masses, who currently depend on kerosene lanterns and candles to satisfy their lighting needs.
How does Lighting Africa support the development the lighting market? The Lighting Africa program is a market-based approach, grounded in the recognition that: There is a considerable commercial market opportunity and willingness to pay for off-grid lighting, substantiated by annual expenditures on kerosene amounting to $38 billion and $17 billion, globally and in Sub-Saharan Africa, respectively Recent technological advancements in lighting, particularly in the area of Light-Emitting Diodes (LED), demonstrate increased promise to deliver affordable technological solutions tailored to the African marketplace and beyond The most expedient and sustainable way to bring affordable, reliable lighting to Africa is by supporting the industry to design and deliver an array of products tailored to the needs of African consumers
How do we ensure Lighting Africa program activities respond to industry need? All Lighting Africa program activities are designed withand for the industry and other stakeholders Through ongoing consultation with a wide array of stakeholders (including private companies, NGOs, financiers, governments and other key players along the supply chain) opportunities are identified where Lighting Africa can play an appropriate role in accelerating the off-grid lighting market in Africa
Lighting Africa: Program Areas Policy: Addressing policy and regulatory barriers Financing: Improving access to finance along the distribution chain- for example through partnership with financial institutions Product Quality Assurance: Addressing issues of quality with lighting products to help consumers make informed purchase decisions and prevent market spoilage Business-to-Business Linkages: Creating opportunities for different players along international supply chain to meet, exchange information and create business partnerships Market Intelligence: Collecting & disseminating key market information to support successful market penetration Business Environment: Facilitating market entry through the provision of relevant information, such as country-specific policy and regulatory information
What has the market research provided? Key Market Information on consumer needs, preferences and finances. The information has: Informed on the desired functionality and design attributes of different types of lighting products within several product classes (Torch, Floodlight, Task Light, Lantern, Spot Light) Enabled the industry to overcome potential challenges that are likely to accompany market entry in the African off-grid lighting market Created a baseline to quantify the size of potential market segments in volume and value terms
Lighting Africa: Why Market Research? • While anecdotal evidence shows a substantial opportunity in the off-grid lighting market in Africa, much of the industry lacks the information needed to develop and market products appropriate to meet the needs of African consumers • This is the result of a premature and undeveloped market, but one with demonstrable potential – the fuel-based lighting market in Africa is currently worth more than $17 billion per year – yet is still largely undefined, untapped, and unrealized • In response to the industry’s call to provide greater comprehension to the scope of this emergent market opportunity, Lighting Africa developed a Market Research program
Research International: Background and Related Experience The research was conducted by Research International East Africa, a subsidiary of the global market research firm: Research International is one of the world's largest custom market research agencies, with offices in 50 countries worldwide and over 30 years of expertise.
Research Methodology • Currently, the Lighting Africa market research program covers 5 countries: Ghana, Kenya, Zambia, Ethiopia and Tanzania • Two key market segments: households & micro-businesses in rural and urban areas • The market study involves studies of the market in Africa to provide insights that form the basis for innovative product ideas; and is comprised of three research methods: • An exploratory phaseinvolving a qualitative product testing element • A quantitative Habits and Attitudes survey of the population • Quantitative Lighting Devices Testing, using the proprietary eValuateTMmethodology, to quantify the acceptance and likely uptake of existing, new and revised product ideas for the market in Africa
Lighting Devices Testing Context • The purpose of the lighting devices research is to: • Assess consumer acceptance and potential for each of the lighting devices tested within the context of norms • Prioritise and provide guidance as to which products to take forward to the next stage of development
Kenya Sample structure • Twenty interviews were conducted per country • Main purchasing decision makers were interviewed both prior to use and after recall. Consumers also filled out a questionnaire during usage of the test lights. • Interviews were conducted in peoples’ homes to ensure that observations were made about the space lit and the kind of lighting used
Key Questions Asked To Qualitatively Evaluate Lighting Devices Would you buy it? Is the idea genuinely new and unique? Is the idea clearto you? Is it relevant to you? Do you find it exciting? Do you actuallylike the idea? Do you think it would offervaluefor money? How oftenwould you buy it? Do you believe it? Supported by spontaneous likes and dislikes
Key qualitative questions Interviews focused on answering these questions: Who is the consumer? • Consumer demographics and characteristics of households How does the consumer use light? • Current lighting habits, attitudes, preferences and needs How do consumers perceive the products? • Assessment of the new products versus product characteristics, features, learning and marketing approach What does the consumer want? • Assessment of needs for current lighting in and around the home Which products do consumers prefer? • Product preferences (performance and design features) and developing a quality standard for lighting How much is the consumer willing to pay? • Consumer economics (intent and capacity to pay for lighting)
Predicting the likelihood of successful product launch • What we know about successful product launches is that there is a lot more at stake than merely identifying which products should be launched versus which shouldn’t. In predicting the likelihood of a successful product launch we must also identify key drivers that will ensure long term success • Within developing markets, measures of new product success are slightly different from other parts of the world. In developing markets consumers have little disposable income which means their behaviour with regards to new purchases will be quite conservative – they will not take chances buying into new products if they are not sure whether the product will work for them or not • In order to predict the likelihood of successful product launch, it is important to understand 3 critical measures: the “WHAT?”, the “WHY?” and the “WOW?”. These will be discussed in further detail in the next slides • Additional to these three measures, it must be kept in mind that the cost of the new product, in this case the lighting device, will undoubtedly remain a main driver in creating purchase intent amongst consumers with low levels of disposable income
The product must have a recognisable point of difference The WHAT? Test • The WHAT test involves a check of the consumers’ understanding of the various lighting devices under consideration • For the lighting devices to be successful in the market, consumers need to be sure that the lighting devices: • Have a recognisable point of difference, i.e. that it is better than what they are using currently or that it could impact and improve their life in a significant manner • Are understood – it has to be clear how the devices will work
This point of difference has to be perceived as a benefit The WHY? Test • The WHY test involves a check of the consumers’ need for the various lighting devices under consideration • For the lighting devices to be successful in the market, consumers need to be convinced that they will berelevant to their lifestyle • If the lighting device is perceived to be technologically ‘too advanced’ or too difficult to operate, consumers will feel alienated– it will be perceived as a device for ‘them’- i.e. those people who have more money, and not for ‘me’
This benefit must be exciting enough to overcome barriers to trial and usage The WOW? Test • The WOW test involves a check of the consumers’ excitement for the various lighting devices under consideration • For the lighting devices to be successful in the market, consumers need to be convinced that the devices will be innovative and creative • If the devices do not stand out from what is in the market currently, they won’t generate sufficient interest from consumers to encourage purchase and substitution away from other product types
Traffic light rating system • A traffic light system has been used to report the overall rating provided by the respondents for the features and characteristics of each of the lighting devices: + Overall, the respondents were positive about the specific feature/characteristic Overall, the respondents were positive about the specific feature/characteristic, however some respondents had remarks that require attention +/- - Overall, the respondents were negative about the specific feature/characteristic
Kenya BRIEF COUNTRY OVERVIEW
Brief Country Overview: Kenya Kenya Interesting facts: The incidence of poverty in Kenya is quite high; in some parts, as many as 7 out of 10 persons live in poverty The distribution of wealth in Kenya is highly inequitable; with the bulk of the nation’s resources held by a privileged and select few. Much of the population is not connected to the electrical grid.
Need for electricity lines Supply of water Repair of sewage Regular clearance of garbage Installation of security lights More unity among people Solving of drought problems Creation of employment opportunities Better food accessibility Better housing plans for slums Security Electricity connection House renovation Supply of water (24/7) Having a toilet on our plot so we do not have to share with neighbours Having a nearby place to dispose rubbish Suggestions for improvement- living standards Surrounding Surrounding In-home • I would buy household electronics like a TV or a fridge if I had electricity male, urban, lower LSM • We need electricity for lighting because we are in darkness every day male, rural, higher LSM • When you want to use a toilet you have to walk for about 300m for a charged toilet services, otherwise we end up going to a bar for a drink and then access a free toilet male, urban, lower LSM
Likes and dislikes of not having electricity • It feels so bad not to have electricity because you miss out on very many things, the only way you can have an update on what is happening is by going to a bar where you can watch TV male, urban, higher LSM • Having no electricty makes life dark both inside and outside the house female, urban, higher LSM • The hole in the roof allows sunlight to enter the house during the day, if I covered that hole there would be total darkness in the house male, urban, higher LSM
Electricity connection usage & attitudes Ranging from = few respondents to = many respondents • Most respondents do not expect any connection to the electricity grid in the near future because they are only tenants and have to rely on the landlord’s decision on electricity connection • I have lived here for 30 years now and no electricity has been installed, I do not see that happening any time soon female, rural, higher LSM
Current lighting situation • The lighting situation is so difficult because we have school-going children who have to study at night so the lamp is on most of the night and that makes it expensive i.e. half a litre of kerosene every night for lighting only female, rural, higher LSM • I use a car battery for 150 KW torch bulbs which I have to recharge every 2 days and it is expensive, I pay US$ 0.60 every 2 days male, LSM 1- 5, urban, lower LSM • I use the kerosene lamp most often but when I do not have enough money for kerosene then I resort to candles or ngwatira (tin lamp) male, rural, higher LSM v
Current Lighting ProductsUsage • Most often, kerosene lamps and candles are used for lighting • Though perceived to be expensive, kerosene lamps are mostly used because they offer a brighter light and are healthier to use as they do not emit too much smoke • The tin lamp (koroboi) is perceived to be cheap but has greater health risks • Car batteries are also used by a few people for lighting and powering TV and radio
Cost/ affordability Convenience (should be able to be switched on & off on a need basis) Bright light Low risk (health and house) Ease of maintenance Availability of fuel Durability Mobility / portability Mother/wife Father/husband Choice determinants & influencers of current lighting product Usage determinants Key influencers • In most cases the father/husband being the main income earner, decides which lighting product is used at home. However, in a few cases the mother/wife influences this decision. • I make the decision on what lighting product to use because my children’s father never spend time at home, he always leaves very early at 4am and he comes back very late at 10pm so he does not even bother to know what we usefemale, rural, higher LSM
Current lighting products used-different settings • I use the koroboi (tin lamp) because it is economical male, urban, lower LSM • We use these tin lamps but we know that they are not good, the smoke that is emitted from them can be dangerous for our health male, urban, lower LSM • A candle is good for a bachelor like me because candles are very easy to use male, urban, lower LSM • I only use candles when I do not have enough money to buy kerosene but they have very dim light female, rural, higher LSM • A torch is very useful for lighting especially outside female, higher, lower LSM • We mostly use a torch to go out for a short call at night male, rural, higher LSM • In most cases we use a kerosene lamp, you know it has a bright light and it is healthier than the koroboi (tin lamp) female, urban, lower LSM • A kerosene lamp is better for people with families because it is not dangerous like candles female, urban, higher LSM • A kerosene lamp has the best light for reading female, urban, lower LSM
Current Lighting Products-satisfaction rating Not satisfied Very satisfied
Electricity (grid) Solar power Easy to maintain Affordable Bright light/ wide coverage (able to light a big area) Safe to use Can be cabled to supply lights to many rooms in the house Should generate little or no heat Ability to be hung or fixed at a high level far off children's reach High quality/ durable From a prominent manufacturer Can be used for commercial purposes Current lighting products-ideal product Ideal product Key characteristics • Grid electricity powered products are perceived as the most ideal lighting products that have the key features of an ideal lighting product • Solar powered products are also considered ideal lighting products • Solar is the best because I do not have to carry it for charging like a car battery as it uses natural energy to charge the batterymale, urban, lower LSM
Test Product evaluation TM41 • The product was completely unique to the respondents interviewed • Respondents considered the product very relevant to the lifestyle of the poor because it is solar charged and therefore no running costs involved • It is very exciting because it has two lamps that can give enough light for the activities in the household none very
Test product association TM41 Car lights Nice colour Very bright light Light for the whole house Good light What comes to mind when you see this product ? Looks like a radio Modern The product is thought to look like a radio to some people and others think it looks like a car light given the bright light and the appearance.
Test product evaluation likes TM41 • The lamps have a good shape and a nice black colour that is suitable for a lighting product male, urban, lower LSM • The black colour is good especially for us in rural areas, it does not easily show dirt female, rural, higher LSM • Not too many wires that can disturb in the house; also short circuits are limited with short and few wires male, urban, lower LSM • The writings are clear and easy to read though some of us can not read male, rural, lower LSM • The size is good enough and it’s interesting that it can be hung on the roof and then can supply enough light for the whole house male, urban, lower LSM • The controls are easy to use and generally the product can be operated by anyone female, rural, higher LSM • This is like grid electricity with no extra usage charges, it is as good as grid electricity female, urban, lower LSM • Bright like grid electricity • Design • Colours • Size (portability) • Controls • Shape • Writings • Wires
Test Product Evaluation – Dislikes TM41 • I do not understand the text male, urban, lower LSM • The light is bright but it faces one direction, it would be better if it could shine in all directions male, rural, higher LSM • One can not tell if it is charging or not; and there is no indication that shows if the battery is full male, urban, lower LSM • Light faces one direction • Writings • Charging
Test Product features evaluation TM41 • The colour black is very appealing, it is believed to be the best colour for a lighting product, mainly because it does not show dirt easily • The other appreciated factors for TM 41 are: • The two lamps are expected to offer enough light for most activities in the household • That it can be hung from the roof is much appreciated because in this way the whole house will receive more light • TM 41 was also considered easy to operate; no one had a problem using it
Test Product characteristics TM41 • Product satisfaction before placement was high on all aspects • One improvement suggestion was to allow extra electronics to be charged by the solar panel (e.g. TV)
Purchase Intent & Price TM41 US$ 38 - 58 • Likelihood to purchase was high and TM41 was perceived to be worth more than other products • The price expectation range was US$ 38 – 58 but most respondents expected it to be around US$ 58
Test productsummary before testing TM41 • Overall the product is cherished and the most outstanding features of TM41 are: • Bright light • The double lamps that can light two rooms simultaneously • Ability to hang the device on the roof which allows more light to be spread in the house • The black colour which is perceived as the best for a lighting product because it does not show dirt easily • Some people we spoke to saw TM41 as an equipment that can save them from buying expensive kerosene everyday and which solves the problem of the dim light provided by their current lighting devices • If I owned this, I would forget about kerosene expenses for good and the dim light female, rural, higher LSM • It is cheaper and does not emit smoke like the kerosene lamp we use female, urban, lower LSM • There were only few dislikes for TM 41 before placement • Some respondents mentioned that the product does not have an indicator showing whether it is charging or not • Others recommended having bulbs that allow light to shine in more directions
