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LIGHTING DEVICES TEST RESULTS. Tanzania Results June 2009. Report Overview. LIGHTING AFRICA OVERVIEW / MARKET INTELLIGENCE PROGRAM. What is Lighting Africa?.
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LIGHTING DEVICES TEST RESULTS Tanzania 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: Put in the picture the desired functionality and design attributes of different types of lighting products within 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
Tanzania Sample structure • Twenty interviews were conducted per country • Main purchasing decision makers were interviewed both prior to use and after recall. respondents 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
Tanzania BRIEF COUNTRY OVERVIEW
Brief Country Overview: Tanzania Tanzania Interesting Facts: Tanzania lies in the bottom 10% of the world’s economies in terms of per capita income. Forty percent of Tanzania’s GDP is dependent on agriculture, with 8 out of 10 Tanzanians being employed in the agricultural sector. The distribution of wealth amongst families in Tanzania is 34.6% (Gini coefficient), which isn’t surprising given the country’s socialist past.
Community based suggestions: - Construction of proper infrastructure and basic amenities I would like to have a good drainage system, good infrastructure e.g. streets, good hospitals and good schools in our surroundings to prevent our children from walkinglong distances Male, Lower LSM, Urban Material (ensuring parity amongst themselves and their neighbours) and information based needs: Get connected to the electricity grid Get connected to clean water Start business once they are able to operate a fridge Renovate the house Buy radio and / or television I wish to renovate my house so that it can become modern by nice paintings, good and durable doors and windows, with electricity installedMale, Lower LSM, Urban Suggestions for improvement-living standards Surrounding In-home Electricity connection is desired not only for personal gain but also as a possible vehicle to earning some income through businesses such as selling cold water, selling ice-cream or metal works. It is also desired because it would facilitate access to information through watching of news on TV.
Likes and dislikes of not having electricity • Electricity makes life easier like ironing, cooking and doing homework for the childrenFemale, Lower LSM, Urban • Not listening to news on radio and watching television, makes us not up-to-date like everyone else Male, Higher LSM, Urban
Electricity connection- usage & attitudes Ranging from = few respondents to = many respondents Electricity is perceived as important and is on all the respondents’ wish-list. Unfortunately, due to limited purchasing power / disposable income, the likelihood of connection is perceived to be between 6 and 12 months time.
Current lighting situation Current lighting situation has room for improvement since respondents are not happy about it. Many feel that they have no choice but to be in their current situation because they have no electricity • Lighting situation is depressing and problematic because I use a kerosene lamp which emits a lot of smoke and as a result we always cough Male, Lower LSM, Urban • Lighting by tin lamp is not good because it hurts our eyes and chest because of the smoke it produces. At times the paraffin is polluted with water and dieselMale, Lower LSM, Urban
Current Lighting Product- Usage The most commonly used ‘every day’ lighting product is the kerosene tin lamp as it is cheap to buy and maintain. Candles are considered dangerous since they are not steady when placed on a surface and can easily cause fire as burn out. They are however, the most preferred products for emergency lighting.
Cost of lighting / affordability Convenience when using the light Safety when using the light Current need for light in the household Amount of light emitted Durability / quality and perceived value for money for the lighting product The bread winner in the household i.e. father, mother Choice determinants & influencers of current lighting products Usage Determinants Key Influencers The availability of money is the key determinant of the lighting product used. The bread winner, in consultation with the user (if the user is different) determines the kind of lighting product used.
Current lighting products used-different settings I mostly use a kerosene tin lamp (kibatari), I use it at night when I am indoors and sometimes even outside the house like on the verandaMale, Lower LSM, Urban My children use candles especially for readingMale, Lower LSM, Urban No, we don’t use firewood for lighting; we only use it for cookingFemale, Higher LSM, Rural In the bedroom, I put it on the table because I want to see where I am sleeping and just keeping it near me for security purposesMale, Higher LSM, Rural I use the tin lamp (kibatari) in the kitchen, however it emits a lot of smoke and therefore I prefer to use the kerosene lamp because it is cleanerFemale, Higher LSM, Rural.
Current Lighting Products-satisfaction rating Not satisfied Very satisfied
The ideal product is perceived to have the following attributes: Provide very bright white light Be affordable about 10,000 TZS –15,000 TZS (US$ 7.5 – 11.3) Not produce any unhealthy emissions Not have any negative effect on eyes Of the key features mentioned, the most important ones are: White intense light Generate its own power Durable / long lasting Portable Electricity bulb shape (Circular shape) Readily available (sold in electronic shops) Have warranty Be made by reputable manufacturers (e.g. Japanese) Current lighting products- ideal product Ideal product Key features Bright, clean, white and affordable light which fills the whole room is considered as the most ideal.
Test Product evaluation TM41 This lighting product aroused a lot of excitement in respondents. Most of them may have already seen similar lighting concepts but they still found this product very different in its design and charging system. They also found it very relevant to their lighting needs. This one has many small bulbs unlike the others in the market which have one bulb only and the radio option is very niceMale, Lower LSM, Urban none very
Test product association TM41 Saves on kerosene, better light and easy to charge Attractive design Good size What comes to mind when you see this product ? Easy to use Good shape Upon seeing the product, respondents immediately anticipated a positive change in their lighting situation. They believed that the product would help them save on costs, have enough and convenient lighting as well as attain a positive image in the community.
Test product evaluation likes TM41 • Its light intensity is brighter and betterMale, lower LSM, urban • The lamp has a radio optionMale, lower LSM, urban • It has a slot for recharging the radio unlike RY04Male, lower LSM, urban • With this product, I will save on certain costs e.g. keroseneMale, lower LSM, urban • Its battery is good because it does not have recharging costs…..you just put it outside in the sun to rechargeMale, lower LSM, urban • The two lamps are situated away from the power pack and can be placed in two different rooms in the houseMale, higher LSM, rural • Affordability • Brightness • Radio option • Two lamps to illuminate two different rooms at the same time
Test Product Evaluation - Dislikes TM41 The colour is not good, black colour is not good… should be made from different colours e.g. green or yellowMale, Lower LSM, Urban • The brightness of the light cannot be controlledMale, Higher LSM, Rural • Black colour • No light dimming option
Test Product features evaluation TM41 • The product features got a high rating by respondents as they tied them directly to the functionality of the lighting device. Features were considered to be ease of use, brighter light, flexibility and affordability. • A few respondents had a problem with the black colour of the device but this was not a dislike that could affect purchase intention.
Test Product characteristics TM41 The product was rated highly and suggestions for improvement involved value addition as opposed to the basic product components.
Purchase Intent & Price TM41 US $ 7.5 – 15 The likelihood to purchase this product was very high even though respondents were concerned about the price because they perceived it to be quite expensive based on overall characteristics. Respondents were of the opinion that the device is worth more than what they currently use / know in the market. On average they would pay US $ 7.5 – 15 for this product even though they believe it is worth more than that. Because it is the first time I have come across such a product with such a beautiful shape and good lighting. It must be quite expensive Male, Urban, lower LSM
Test productsummary before testing TM41 • Respondents rated this product highly even before they tested it; the product was perceived to be of high value. It was viewed as a good improvement to their current lighting situation. • The idea of solar energy was very exciting to respondents, they saw this as a long-term saving for them as kerosene is quite costly. • The product has good features that improves its perception on functionality. At this stage improvement suggestions are more ‘hygienic factors’ rather than core product characteristics. • The product was however perceived as expensive and respondents feared that it may be out of reach for them.
