Nairobi grocery stores adapt to capture new markets

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Kenya’s big-box grocery chains continue to adapt to capture new markets and tackle competition.

With an increasing demand for customer-centric service and changing customer behavior, Kenyan supermarkets are having to redesign and rethink their strategies in order to survive. Willy Kimani, the Chief Commercial Officer of Naivas Supermarkets, spoke to Eleni Giokos of CNN International’s Marketplace Africa programme: “The Kenyan customer is changing; it is right now more informed. The customer has now become more complex, he is demanding more.”

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Around two-thirds of Kenyans buy their groceries in traditional markets or smaller stores and kiosks. Bryan Sun, Nielsen Africa Managing Director, explained how this creates the potential for supermarket growth, “Kenya is still a traditional market from a shopping standpoint, but I think it’s prime to move towards more of a modern market. If we look at some comparables, Kenya is about 30% modern trade, South Africa is 70% modern trade, so there is definitely runway there for growth.”

As well as changing consumer behavior, supermarkets are facing competition from international brands. Sun detailed how this competition has changed the industry, “The international players have come in and what we have seen is a change in the discussion. It’s much more of a focus on customer experience, things like consumer understanding.”

Sun also talked about how supermarkets are changing shopping habits across Kenya, “They’re making it a nice experience. It’s not about going and topping up and getting out, it’s about going having an experience, getting everything you want, and have all the choice you want in one place.”

Marketplace Africa visited a Naivas store to see how the changes are being implemented. One shopper tells the program why she prefers using the supermarkets, “You get everything you need you can buy anything you want starting from the foodstuffs, clothing, digital stuff and everything, but you can’t get stuff in local shops.”

Looking to the future, supermarkets like Naivas are working to take advantage of digital potential. Sun clarifies why online sales are so small, but is hopeful for growth in the market, “The Kenyan consumer, still traditional, still likes to touch and feel and see their produce before they buy. So, I would say there are some interesting things going on with e-commerce, I think that it’s still pretty early days in the e-commerce space.”

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