Jumia: Rural areas a critical segment within our addressable market

New York Stock Exchange listed African e-commerce giant, Jumia Technologies, has seen a significant reduction in losses during the third quarter of this year. As the company wraps up its 10th Black Friday campaign, CEO Francis Dufay sat down with CNBC Africa to discuss the company's performance and expansion plans beyond major cities. The third quarter of this year was a crucial period for Jumia, marking a milestone in the company's transformation plan towards improved economics and healthier growth fundamentals. Dufay highlighted the company's progress in streamlining operations, reducing costs, and building a solid foundation for growth over the past three quarters. The positive results in Q3 demonstrated the success of these efforts, with Jumia reporting its lowest EBITDA loss since its IPO in 2019 at $15 million. This achievement showcases not just cost-cutting measures but also significant growth across the company's footprint. Five countries under Jumia saw growth in their e-commerce business year-over-year in dollars, indicating a return to growth with more efficient economics and reduced losses. Despite challenges posed by inflation and currency volatility in the macroeconomic environment, Jumia adapted its business model to address consumer needs even in tough times. Dufay cited the example of Ghana, one of the company's fastest-growing countries, where high inflation rates prompted Jumia to offer affordable entry-level products tailored to price-sensitive customers. The success in Ghana reflects Jumia's ability to navigate challenging economic conditions and provide value to its customers. One of Jumia's key strategies for growth involves expanding its reach beyond major cities to underserved areas. In Nigeria, the company is focused on addressing consumer demand in smaller cities where retail offerings are limited, prices are higher, and choices are constrained. By setting up distribution networks and pickup stations in these regions, Jumia aims to make e-commerce more accessible and tangible to populations outside urban centers. The company's expansion plans in Nigeria include regions like Akure, Ilorin, Benin, and Wari, with a long-term vision to serve consumers nationwide. The recent Black Friday campaign marked a departure from conventional marketing tactics for Jumia, as the company prioritized offering quality products and deals over massive discounts and vouchers. This shift towards sustainable and viable business practices aligns with Jumia's goal of delivering value to customers while maintaining better economics. The Black Friday results so far indicate that customers are inclined towards quality offerings, reinforcing Jumia's strategic direction. Additionally, Jumia announced a leadership change in Nigeria, with CEO Massy stepping down after three years of service. Sunil, who has been instrumental in driving growth in Jumia Ghana, will assume the role of CEO for Jumia Nigeria. The internal promotion reflects Jumia's confidence in nurturing talent within the organization and facilitating seamless transitions in leadership roles.