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The Dark Truth About Jumia. Are you curious about the hidden factors behind one of Africa's largest e-commerce platforms? 🤔 In this eye-opening video, we dive deep into The Dark Truth About Jumia, revealing surprising insights and overlooked aspects of this popular online marketplace!
You'll discover:
• The controversial business practices and challenges Jumia has faced in the e-commerce landscape.
• Insights into customer experiences and complaints that paint a different picture of the company.
• The impact of Jumia's operations on local economies and small businesses across Africa.
Whether you're a frequent Jumia user or just interested in the dynamics of online shopping in Africa, this video will provide you with a comprehensive understanding of the complexities surrounding Jumia.
🔍 Timestamps:
0:00 Introduction
1:30 Overview of Jumia's Business Model
3:50 Customer Complaints and Reviews
6:15 Impact on Local Businesses
8:00 Conclusion: Should You Still Shop at Jumia?
[Add more timestamps as needed]
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Show More Show Less View Video Transcript
0:00
We founded Jumia in 2012.
0:01
We decided to start Junia to change the
0:02
face of retail in Nigeria.
0:04
Junior Nigeria.
0:05
The African e-commerce platform Junia
0:07
Jia Jia Junia Jun.
0:14
Do you know Jumia is no ordinary company
0:16
and trust me this is no ordinary story.
0:19
This is one of the most inspiring
0:21
business stories you will ever hear of.
0:23
How a team of young men came together to
0:25
revolutionize the way Africans shop. But
0:28
before we dive deeper, a quick shout out
0:30
to today's sponsor, Rolodell. Just like
0:33
Junia relied on young, talented people
0:35
to build Africa's first major e-commerce
0:37
empire, Rolodell is a freelance
0:40
marketplace that connects skilled
0:41
professionals with the businesses that
0:43
need them most, especially in Africa.
0:46
Whether you're building the next big
0:47
platform like Jumia, running a small
0:50
business, or just need an extra set of
0:52
hands for your projects, Rolodell makes
0:54
it simple to find the right talent and
0:56
get things done. Think of it as your
0:58
shortcut to assembling a worldclass team
1:01
without the corporate overhead. Check
1:03
them out at rolodell.com and start
1:05
turning your own big ideas into reality.
1:08
Now, let's get back to the inspiring
1:09
rise of Jumia and uncover how it went
1:12
from a bold dream to Africa's first
1:14
unicorn. Jumia was not just Africa's
1:17
largest e-commerce company. It was a
1:19
promise from a continent known for being
1:21
sidelined in the global tech market.
1:24
While on the other hand, in the shadows
1:26
of the shiny promise were stories of
1:28
questionable practices, operational
1:30
inefficiencies, fierce competition, and
1:33
a challenging marketplace struggling to
1:36
bridge two different worlds. Rocket
1:38
Internet was established in Berlin in
1:40
the year 2007 by the Samware brothers,
1:43
Oliver Mark and Alexander Samware. They
1:46
were known for replicating successful
1:47
business models from established tech
1:49
companies. And over the years, Rocket
1:52
Internet positioned itself as a global
1:54
incubator, launching numerous
1:55
e-commerce, food delivery, and online
1:57
service platforms in emerging markets
1:59
like Africa, Asia, Latin America, and
2:02
others. Now with extensive experience in
2:05
building successful ventures, Rocket
2:07
Internet saw a promising opportunity in
2:10
Africa's untapped e-commerce which made
2:12
them select experienced consultants
2:14
Jeremy Hodara and Sasha Puon to
2:17
establish a foothold in the continent's
2:19
largest economy. Rocket Internet
2:21
recognized that the African market was
2:23
underserved despite a growing demand for
2:25
convenient online shopping and this led
2:28
to the launch of Kasoua in Nigeria in
2:30
June 2012. This venture was one of the
2:33
first major e-commerce platforms in
2:35
Africa designed to bridge gaps in retail
2:38
services across the continent. Now I am
2:41
sure you are wondering how two French
2:42
guys came up with the name Kasua which
2:45
means markets in house of language.
2:47
Interestingly the name was not their
2:49
idea but the initiative of the
2:51
co-founders. Tundai and Rafael Aador
2:54
often refer as co-founders of Africa's
2:56
e-commerce giant because they played
2:58
crucial roles in launching and scaling
3:00
the startup in Nigeria. Tundai and
3:02
Rafael joined as Nigeria's founding team
3:05
and they were instrumental in localizing
3:06
the business model to suit the Nigerian
3:08
market by building its operations,
3:10
managing day-to-day challenges, and
3:12
navigating the complexities of Nigeria's
3:14
emerging e-commerce landscape. This and
3:17
more are the reasons why they are often
3:19
regarded as co-founders. The name Kasua
3:21
was chosen to resonate more with the
3:23
local audience and reflect the
3:25
marketplace concept they were building.
3:28
However, after some time, Rocket
3:30
Internet decided to unify their African
3:32
e-commerce ventures under one
3:34
recognizable brand name. This rebranding
3:36
was intended to create a cohesive
3:38
pan-African identity as they expanded
3:41
into multiple African countries. Jumia
3:44
became the first pan-African technology
3:46
company that was built around the
3:48
marketplace logistics service and
3:50
payment service. The logistics service
3:53
enabled the delivery of packages through
3:55
a network of local partners while the
3:58
payment services facilitated the
4:00
payments of online transactions within
4:02
Jumia's ecosystem. Jumia became a
4:04
dominant player in the African
4:06
e-commerce ecosystem just like Amazon in
4:09
the US and Alibaba in China. Lest I
4:11
forget, Jumia was the first African tech
4:14
startup that went public on the New York
4:16
Stock Exchange on the 12th of April
4:18
2019. Now, Citron Research says Jumia
4:21
inflated its active consumers and active
4:23
merchant leaders by 20% to 30% in order
4:26
to raise more money from investors.
4:28
So, with all of that being said, let's
4:30
get back to the story. In its early
4:32
days, Jumia was pretty aggressive to
4:34
dominate the African market. Hence, it
4:36
expanded very quickly and launched a
4:38
bunch of other products such as Jumia
4:40
Travel, which was launched in 2013.
4:43
Initially named Jovago, it was Jumia
4:46
Group's online hotel booking service
4:48
focused on making it easier for users to
4:51
find and book accommodations across
4:53
Africa and beyond. The platform was
4:56
later rebranded to Jumia Travel in 2016
4:59
to align with the Jumia brand across its
5:02
other e-commerce services. However, 3
5:05
years down the line, Jumia Travel was
5:07
acquired by Travel Start, an online
5:09
flight booking platform with presence in
5:12
Nigeria and South Africa. Another key
5:15
product that was launched was Jumia
5:17
Food. Jumia Food was launched in
5:19
September 2013. Originally branded as
5:22
Hello Food, this online food delivery
5:25
service was part of Jumia Group's
5:27
expansion into various sectors beyond
5:29
traditional e-commerce, aiming to make
5:32
ordering food from local restaurants
5:34
more accessible across Africa. And just
5:36
like Jumia Travel, HelloFood was
5:39
rebranded to Jumia Food in 2016 to unify
5:42
the brand across Jumia's various
5:44
services. At this point, Juma was
5:47
feeling like the king of the African
5:49
e-commerce market, which they were. They
5:51
moved on to launch various other
5:53
products, one of which was Jumia 1 in
5:56
2018. Now, with all of these platforms
5:58
and services operating under their belt,
6:00
Rocket Internet decided to put them all
6:02
under one company, and they call it the
6:05
African Internet Holdings in which MTM
6:08
Group acquired 33% shares. and
6:10
Milliccom, a Latin American company,
6:13
also had 33% shares. This acquisition
6:16
and partnership moved on to play a part
6:18
in turning Jumia to a unicorn company.
6:21
With various products in the Jumia
6:23
ecosystem, there was no doubt Jumia was
6:25
aiming for the moon. Investors took
6:27
notice. MTN Miliccom and AXA poured in
6:30
millions, recognizing that Jumia was
6:33
building more than an online store. It
6:35
was setting up Africa's first true
6:37
e-commerce ecosystem. For example, MTN
6:40
helped extend Jumia's telecommunication
6:42
and infrastructure support while AXA
6:45
provided insurance services. Each
6:47
partnership opened doors, giving Junior
6:49
access to new resources and a deeper
6:52
understanding of the continent's
6:53
challenges. Jumia also became known for
6:56
its bold localized marketing. Every
6:58
November, it launched massive Black
7:00
Friday sales across the continent, which
7:02
brought in record traffic and sales. By
7:04
now, Jumia was no longer just a
7:06
marketplace. It was part of the African
7:08
lifestyle where people not only bought
7:10
boats, electronics or clothing, but also
7:13
groceries, travel bookings, and even
7:15
meals. All of these developments
7:17
culminated in 2015, making Jumia hit
7:20
about $1 billion in revenue. And the
7:23
following year, it hit a monumental
7:24
milestone. Its valuation crossed the
7:27
billion dollar mark, officially making
7:29
it Africa's first tech unicorn. In just
7:32
four years, Jumia had transformed from a
7:34
startup with a lofty dream into a
7:37
digital empire stretching across 14
7:39
countries. And most importantly, it was
7:41
a hope for a connected modern future in
7:44
a diverse and dynamic Africa. So with
7:46
all of this dominance, what gradually
7:48
led to Jumia's decline, the company is
7:51
struggling as inflationary pressure has
7:54
caused a currency crisis in Africa which
7:56
dents its revenues. Despite its rise,
7:59
Jumia's story took a dramatic turn as
8:02
the company's dominance in the African
8:03
e-commerce landscape began to unravel
8:06
beneath the surface of rapid growth and
8:08
$1 billion valuation. There were cracks
8:11
that started to appear, signs that a
8:14
dream of a pan-African digital empire
8:16
was harder to sustain than it first
8:18
seemed. If you come with your blueprint
8:20
of e-commerce that worked everywhere
8:22
else in the world and you want to
8:24
implement it and copy paste it in
8:26
Africa, it will surely not work. That's
8:28
for sure. And also there was
8:30
competition. By 2016, new rivals, both
8:34
international and homegrown, started
8:36
eating into Junia's market share. These
8:38
competitors were often more targeted,
8:40
which proved to be more in line with
8:42
consumer preferences. In particular,
8:44
other smaller specialized companies
8:46
often managed to stay ahead by offering
8:48
a more tailored localized shopping
8:50
experience that Jumia's broad
8:52
all-encompassing model couldn't always
8:54
provide. Internally, there were also
8:57
signs of strain. Jumia's rapid expansion
9:00
had meant that the company was hiring
9:01
quickly, but the talent it brought in
9:04
sometimes struggled to keep up with the
9:05
demands of managing such a large,
9:07
complex organization. The company's
9:09
corporate structure, which had worked in
9:11
the early days, began to look
9:13
inefficient. Financial pressure
9:15
continued to mount despite huge
9:17
investments from higherprofile
9:18
investors. Jumia struggled to make
9:20
profits. The promise of profitability
9:23
was always just out of reach. So, the
9:25
company isn't profitable right now. By
9:27
2019, Jumia was forced to lay off a
9:30
significant portion of its workforce. It
9:32
was also widely speculated that Jumia
9:34
had to close shop in some of its African
9:36
markets to arrest its losses. And it
9:39
didn't take long before the company
9:40
suspended operations in two African
9:42
countries so as to cut down on the
9:44
loss-making spree that hit a whooping
9:47
threshold of $1 billion. However, even
9:50
these moves weren't enough to turn the
9:51
tide because more blows came as
9:53
accusations of fraudulent activities
9:55
within the company surfaced in 2019. A
9:58
report by an investment firm named
10:00
Citron Research claimed that Jumia had
10:02
inflated its financials by exaggerating
10:05
its transaction numbers and the size of
10:07
its customer base. These allegations
10:10
sent shock waves through the business
10:11
world and the public began to question
10:13
whether Jumia was really as successful
10:16
as it had claimed. Now, Citron Research
10:18
says Jumia inflated its active consumers
10:21
and active merchants figures by 20% to
10:24
30% in order to raise more money from
10:26
investors. Well, Junia Julia tried to
10:28
defend itself, but the damage to its
10:30
reputation had already been done. The
10:32
company's problems were compounded by
10:33
the broader economic environment at that
10:35
time. Africa's economy had become more
10:37
volatile with currency devaluations and
10:40
economic instability in some of its key
10:43
markets like Nigeria. This made it even
10:45
harder for Jumia to maintain its pricing
10:48
structure and keep its operations
10:50
profitable. You know, it's quite sad to
10:52
see Junior's gradual decline with a
10:55
combination of rapid growth, operational
10:57
inefficiencies, fierce competition, and
11:00
a challenging market. Its story is a
11:03
lesson that shows the complexities of
11:05
doing business in a continent as diverse
11:07
as Africa.