M-Zawadi: Inside Tech Venture Creating Loyalty Programs For Manufacturers And SMEs

Written by on 12 March 2024

Businesses across the world are keen on growing and sustaining market share, and increasing their profits. This can be done through well thought out strategies, one of them being customer retention through strategic relationships. One such way to achieve this is through loyalty programs, where businesses incentivize their customers.  

This is why in 2016, Naftali Nyabuto founded M-Zawadi Group, a tech venture offering different tech solutions targeting both entrepreneurs and businesses. One of the innovations under the group is the M-Zawadi Loyalty Programs, which initially targeted small and medium enterprises and manufacturers.

“The focus then was for SMEs, which we wanted to introduce loyalty programs to. These are people like mama mbogas who did not have access to computers. So we thought on how to empower these people because they also want to retain their clients. We realised there is a big gap in the industry and loyalty programs are transforming themselves, they are no longer just rewarding for purchasing products. They are behaviour change tools,” Nyabuto says.

To catch up with the ever-changing demands, M-Zawadi now started targeting other sectors, among them the service industry and Fast Moving Consumer Goods. This is because the businesses were now looking for behaviour change tools that could help them grow. 

“They want to incentivise and retain their clients. They want to analyse the behaviour of their clients. That became very informative for them. They also want to push sales. So how do you create incentive programs that can help the company return their investment in terms of their sales without only focusing on retention? We now started channel loyalty programs for manufacturers. FMCG space. We try to see how we can streamline that chain at the same time creating incentives, make those partners become more loyal to them and reduce competition and create differentiation in those brands,” Nyabuto adds.

One of the main customers today is Kenafric Industries, who use the loyalty program to incentivise their retailers and also create relationships between their sales reps and the customers. 

Mercy Odira, the Kenafric Loyalty Program manager, says the partnership with M-Zawadi has seen some of their products get more sales. Initially, the products were dormant. 

“Once a customer purchases our products they earn points and redeems them after accruing a certain amount. The customer experience with the M-Zawadi project is positive, they feel appreciated and that the project has really helped them grow. There is more interaction between the sales reps and the customers, our weaker brands have grown and with this project we have now been able to drive all the brands that we sell,” Odira said. 

David Ahonya, a trader in Kibera who sells sweets and ice cream, has been relying on the points he accumulates to buy more products. 

Odira says after hitting a certain target of loyalty points, he is able to get more goods without spending money on them. 

“Nafanya biashara ya kuuza sweets na ice cream. Kuna mhudumu mmoja wa kampuni anatembeza bidhaa za kampuni ukichukua anakuwekea points kulingana na bidhaa zenye umenunua. Points zinasaidia kwa sababu sasa nitaziredeem sitahitaji kutumia pesa mingi, huenda ikawa nitaongezea pesa kidogo kuchukua zile bidhaa nitataka. Kwa biashara ukiweza pata same product haujaiba lakini umepewa kulingana na zile points umepata inatia moyo,” Ahonya said

Having successfully worked with manufacturers, M-Zawadi has now spread out its tentacles to target other sectors, such as banks and SACCOs. 

This has seen the innovation getting adopted by both local and international businesses.  For example, M-Zawadi prides itself in being the only venture with over 700,000 outlets where subscribers can walk in and redeem. 

“Banks and SACCOs have become one of our biggest portfolios in loyalty programmes. We realised that as a bank or as SACCO there are things you want to change behaviours with. For example, a SACCO wants you to open a new account, take a loan or repay a loan more promptly, those things they want to take on or they are struggling with,” Nyabuto further said.

Today, the venture prides itself in being one of the key players in providing technological innovations that have not only transformed customer experiences for businesses but also maximise profits. 

“We became the only guys who have the biggest redemption ecosystem in Kenya. We are talking about 700k outlets where your clients can go and redeem. We have over 2 million subscribers in terms of merchant outlets globally. That means you can move from Kenya to the US or any other country, walk into Starbucks and use the points you’ve earned in your local market,” he adds.

Loyalty programs are no longer just supermarket loyalty programs. M-Zawadi has transformed the industry in that one can use the loyalty program for different things such as getting more clients, retain and or change behaviour and create customer experience.

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