LIGHTING DEVICES TEST RESULTS Zambia 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
Zambia 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
Zambia BRIEF COUNTRY OVERVIEW
Brief Country Overview: Zambia Zambia Interesting Facts: Poverty is a major problem in Zambia. As many as 5 of 10 persons are unemployed. The distribution of wealth amongst families in Zambia is poor (50.8% on the Gini coefficient). The worsening global food prices pose serious challenges for this Southern African nation; where 8 out of 10 Zambians are employed in the agricultural sector.
Water supply in the rural areas Amenities like: Schools Clinics Skills training centres Modern market / shopping centre Public library Recreation facilities e.g. sports fields and parks Improve roads (up-grade or tar them) Improve the water supply systems in the urban areas Cooperatives to be formed Make farming inputs available Loan facilities Street lights Install electricity Build a better house – e.g. ‘burnt brick’ house, fix doors, have a cemented floor Roof house with iron sheets Paint the houses Suggestions for improvement- living standards Surrounding In-home The most important need is that for loan facilities to assist with major improvements like installation of electricity, street lights, building brick houses
Likes and dislikes of not having electricity • My son who is doing grade 12 has left me because there is no electricity here at my house to enable him to study at night as candles are not as bright as lights from electricity. Even my children who stay with me here steal money so that they can watch films at the market because I do not have electricity so they can’t watch television” Female, Upper SEC, Rural • I like how bright electricity lights are and that things in the house look good and how easy and fast it is to cook using an electric stove. I dislike it because it has caused a lot of fires in the past and people have died due to electrical shocks/faults. The other thing is that nowadays in Zambia, electricity has become too expensive and with my salary, I can’t manage to be paying for it every month. Female, Lower SEC, Urban
Electricity connection usage & attitudes Ranging from = few respondents to = many respondents None of the respondents was likely to get connected to electricity within the next 12 months, nor did they know of any plans for getting connected to the grid.
My current lighting situation is not the best. I don’t like it at all. I normally use candles but candles are too expensive and at the same time they produce a lot of smoke which might be dangerous for one’s health. They also produce wax that drop on your clothes, on the table and everywhere else in your house. I don’t like them Male, Upper SEC, Rural I use the candle to light my shop but am not happy with my lighting situation because the candles finish very fast and are too expensive to buy all the time Male, Lower SEC, Urban My lighting is good as the 12 volts bulbs give me enough light for my household and I feel safer when using it than using a candle, as a candle is not all that bright. Male, Upper SEC, Rural Current lighting situation
Current Lighting Product- Usage Candles are currently most often used for lighting while the torch is the least used.
Choice determinants & influencers of current lighting product Usage Determinants Key Influencers • Affordability • Safety • Light intensity • Health • Value for money • Durability • Quality • Familiarity • Wife • Husband • Kids Affordability, safety and the light intensity of a device are the major determinants of usage. The main household head is usually the one who influences the decision about what lighting device will be used.
Current lighting products: Bring it alive Brazier Firewood Blue candle Red Candle
Living room Study table Bedroom Kitchen Chatting Shop Current lighting products- different settings • We use candles for lighting in our home Male, Lower SEC, Urban • We normally put it (candle) on the table so that it can give enough light to all the corners of the room where it is lit. Male, Lowe SEC, Urban • Yes we do but we normally use fire from the firewood we use for cooking to see when we are having supper, most of the times it’s dark already when we are having supper Female, Upper SEC, Rural • In the bedroom and eating area, we place them on a stand, so that they don’t fall and burn the house, but in the lavatory we just carry it, and hold it or put it down because you can’t put it anywhere else there. Male, Upper SEC, Rural
Current Lighting Products-satisfaction rating Very satisfied Not satisfied
Current lighting productsideal product Ideal product Key features • Solar charged lantern • Coil shaped bulb (powered by a solar-charged car battery) • Sunflower-shaped bulb with a stand (solar powered) • A spot light with a hook to hang on to the roof / wall • Solar powered bulbs that hang on the wall like a wall clock • Solar charged • Adequate light intensity • Portable • Easy to use • Light weight • Rechargeable battery • On / off knobs with low, medium and high light settings • Doesn’t produce smoke • Small in size but strong The ideal product for the respondents would be a “familiar” lighting device with adequate lighting intensity to illuminate the whole room, it is safe and doesn’t have any running costs.
Test Product evaluation TM 41 A very unique product which was seen as very relevant mainly because of its light intensity and the fact that one can use it in two different rooms at the same time as it has two bulbs – the latter really excited the respondents. very none
Test product association TM 41 I think it’s a very good product To use it and see what amount of light it can produce. I think it’s a very good product for people like me who don’t have electricity to light up their house. What comes to mind when you see this product ? I think that it’s a good product which lights very well at night in the sense that it looks like it can give bright light because the lights are big which is very good. A product that can give me more light than the candles I am currently using A very positive first impression was received with regards to TM 41 from the respondents
Test product evaluation likes TM 41 • I say so because the lights are big with a lot of these tiny bulbs, I think together they can give enough light. And also, the battery seems to be very good because it is quite heavy and I believe it can produce more power Male, Upper SEC, Rural • The light was powerful, it’s good and one time we put our bulb outside and the whole surrounding was bright and I don’t think you can compare it to an electricity bulb. Female, Lower SEC, Urban • I like the way it is made and also the two bulbs it has such that you have light in two separate rooms using the same product Female, Upper SEC, Rural • A find it very exciting because there is no need of looking for something to buy like candles, matches or even taking its battery for charging since it has all the things for lighting & charging. I find it does not produce any smoke and it is safe to use. Male, Lower SEC, Urban • The many LED bulbs • Strong light intensity • Can be used in two rooms simultaneously - has two light bulbs • Economical – solar rechargeable
Test Product Evaluation – Dislikes TM 41 • Size is ok for the product but the length of the cables should be a bit longer (the cables from the battery to the bulbs) Male, Lower SEC, Urban • Cables connecting the bulbs to the battery are too short
Test Product features evaluation TM 41 Apart from connection cables from the battery to the bulbs that were deemed too short, TM41 was rated extremely positively on all the product features i.e. shape, size, colour and design, i.e. the respondents were extremely satisfied with TM 41
Test Product characteristics TM 41 TM 41 performed extremely well in both functional and aesthetic attributes
Purchase Intent & Price TM 41 USD 9.8- 48.8 TM 41 is perceived to have more Value For Money than the products currently in the market and thus the respondents are very willing to purchase and try the product
Test productsummary before testing TM 41 • Most of the Zambian respondents believe that when a lamp is big in size and round in shape, it is bound to produce adequate light intensity. Consequently, as this was the case with TM 41, it was rated very positively in terms of light intensity. • The ability to use it in two different rooms simultaneously was seen as very relevant to the respondents lifestyles since they didn’t have to buy more than one lighting device to light the various rooms in use at night. • All the respondents who tested this product believed it had value for money; they were willing to purchase it even before they had tested it. • Every respondent thought it was a product well suited to people like them who find it hard to raise running costs for lighting devices (e.g. batteries) and also who cannot be able to afford electricity.