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UK phone maker STK readies for Africa expansion

UK phone maker STK readies for Africa expansion

UK-based mobile device and accessories brand, STK, plans to expand its presence in Africa following initial success with the sale of over 360 000 devices across Botswana, Lesotho and South Africa in the last two quarters of 2016.

The phone maker says it plans to sell a million devices during the remainder of this year by broadening its reach on the continent. The company's refined Africa strategy will include partnerships with mobile network operators to supplement the current approach which relies on sales through the store network incorporating several South African retailers.

Bryan Mansfield, Global Head of Sales at STK says the retail first strategy has worked well so far.

"We've gone the traditional retailer route as our first target for entry into the market. We are currently supplying into Ackermans, The Foschini Group, Shoprite and OK as well Pep stores. That has given us an easy route into the rest of Africa. For some of those retailers, we began supplying their store in Botswana and Lesotho before supplying their South African stores. Some brands struggle to get there and I think these key retailers have allowed good access to the market."

STK says it has since hatched a plan to bring mobile network operators into the fold in order to boost sales as it prepares to widen its reach across Africa.

Buy in from MNOs

Eben Heunis, Regional Manager Africa at STK, said, "It has been easy to rely on the relationships and partnerships in retail because the South African and African procurement teams of the retailers are based in South Africa. Once you have an agreement, you go into a number of African countries. We've chosen that way to enter this market because it is an easier access into channel. Between all the retailers we are presently available in a network of between 400 and 500 stores. To be honest, for a mobile network operator in some of these African countries to look at you, they need for you to already have a presence first and they need to see that there is trust in your brand and that retailers are willing to sell your devices. The focus for us in the larger African market is to get the attention of the networks. That will be our strategy going forward to start building presence in-country and then start negotiation with operators. We are in negotiation to go into Nigeria and into east Africa where operators like Orange and Safaricom dominate."

STK's Mansfield says they have secured its first agreement with an operator by signing on with Mobile Telecommunications Limited (MTC) in Namibia, which now has STK devices bundled with its SIM cards available for purchase in that country.

STK's global footprint includes markets such as China, Britain, parts of Latin America as well as India which is the only country in the world where it plans to establish an STK-branded store.

New entry-level brand

Mark Rogers, Director of Mobile Accessories at STK said STK will launch a more affordable range of phones and accessories for African consumers in June 2017. The company's entry-level offering currently includes three devices, to retail at between R149 to R229.

"Different markets have different needs and our range of devices in Africa will, therefore, differ to those we are pushing in the UK. There are retailers in Africa that are capable of carrying our premium range, but we are creating another range of devices to make ourselves more relevant in the African market called 'lite by STK'. It will be a range that is more about function and even more about the price point. The lite range could potentially double our portfolio. It will have a completely different look to it and it will have a different brand. Our premium range, as our main brand, will be used to introduce new innovation and technology as it is a flagbearer for the brand - and where we will invest our money in marketing and promotion. With the lite by STK range, it is more about volume and price point. The advantage of having the two is that brand association of the STK range will benefit the lite range as well, which will be cheaper but will have the credibility of our premium brand. I think in Africa those two brands will complement each other quite well."

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