Animation: The next big thing in advertising.

By john muchiri.

You have noticed the rate at which businesses are embracing animated adverts lately. From faiba advert to the safaricom sambaza bundle advert. Why are animated adverts so compelling? Animation has the power to give life to a concept: few marketers exploit it to deliver quality marketing campaign that stays in the minds of the customers. It brings the power of imagination and creativity to your marketing. It gives you the power to demonstrate your products to your clients in a better way than the conventional photography can.
Animation can act as a tool of creating a strong brand by creating a character that will be associated with your brand. For example, when you see the 'faiba cartoon' you will be reminded of jamii Telecommunications Ltd. Animated characters in an advert engages the attention of the viewers, then an association between the character and the product is created in their minds.
Whether you are hiring an expert to make your video or you are tackling it yourself. There are certain factors that you need to put into consideration:-

1#. Flexibility.
While making an animated adverts it is easier to make last- minute changes than live action adverts. This is due to the fact that there are no actors who are needed to re-do the script.
2#. Cost.
In many live action ads where celebs are used, cost incurred is generally high. For animated ads there are no actors just the ' voice-over talent' is needed, this brings down the cost incurred.
3#. Time.
Animation can take longer time to produce as it involves developing a concept and giving the concept life. It can take upto several months.
4#. Target audience.
In marketing the target market is everything. If you are able to know your target market and reach them with the right message: you will win their attetion.
5#. Ability to appeal.
The impression created by a marketing campaign should be considered while deciding whether to use live action or animation.

You can write your comments or post a question. Thank you.

Microfinance: Strategy and Business Development

“ Microfinance “ refers to the
provision of financial services such
as loans and savings to small and
medium sized entrepreneurs and
businesses that lack access to banking and related services due to the high transaction costs associated with them.
In other contexts, it could
also include the provision of insurance and training to the same.These services could be drawn through relationship based
banking or group based models, with the latter being more common in East Africa.
Microfinance is certainly a good
investment in a region that is still
developing so long as it is executed properly.
The purpose of this article is to
guide entrepreneurs interested in
investing in microfinance. The
market is immensely large among
the newly employed, middle and lower income borrowers and the
unbanked. Women’s groups or ‘chamas’ are also becoming increasingly becoming popular.
The economic market condition is
in expansion. The projected
business scale is among several of similar or mostly larger scale and there is low failure rate in the industry. Most microfinance companies scale up and become banks within 7 to 20 years.
Execution
1#. The Financing
When thinking about starting a microfinance company, you need to acquire seed funding first.  You may need about half a million shillings and above depending on your target market and your projected financials. Some questions you could ask yourself at this point are:
- How many groups or
individuals are you targeting?
- How much would you be
willing to offer to each individual
or group?
- What is the maximum
amount that you are willing to
offer?
- What is the creditworthiness
and therefore risk of the individual
or group you are dealing with?
- How much interest rate are
you going to offer to your clients?
2#. Secondly you need to register
your company under the Registrar
of Companies. This will cost about
Kshs 20,000.
3#. You also need office space at a
location where your clients will be
able to reach you conveniently.
Basic office furniture and
stationery may be needed. You may however start with a small
‘warehouse’ for keeping the items you need as collateral.
3#. You may develop an online
presence by developing a website
and placing the company name and contact information with online directories.
Website development may cost
between Kshs 12,000 to 20,000.
This step isoptionalbut has been
found to be very useful.
4#. Embark on a vigorous and
extensive marketing campaign for
the target market involving the use of pamphlets, posters, newspaper advertising and
the word of mouth.
5#. There are short term loans,
payday loans and generally loans
offered for different items. Where you are safeguarding items as collateral, offer
a loan that is about 30 to 50
percent of the value of the item
taken as collateral. Items taken as
collateral should have a resale
value- a receipt is often a good indicator.
The recipient of the loan has to consent the loan received and the ‘financier’ has a right to retain the item upon defaulting of the recipient.
All these should be indicated in
writing in a document that is legally admissible in a court of law.
6#. Depending on the amount you
are offering, you may need to
carry out a valuation of the prospective clients assets to determine their creditworthiness. This happens when you are dealing with large amounts
for which you cannot take items
as collateral. You may charge an
assessment fee.
Remember that you or more or less a bank; you are doing this to reduce risk and avoid bad debts. A higher interest rate is often
used to compensate this higher
risk (within legal limits of course).
Remember that you have to
comply with all state, usury lending and credit laws.
To register a company it costs Kshs
20,000,Launch a website Kshs 20,000,Basic Office Stationery
Kshs 20,000,Small Office/Warehouse rent p.m Kshs 25,000
Salesmanship and advertising
(including talk time, MPESA costs
and allowances) Kshs10,000.
Use an optimum interest rate of 10 to 15 percent per 2 weeks to a
month.
Reinvest part of the profit into the
business to increase the capital
base of the business so as to help the business grow faster.

By Eric Rono
Graduate of the University of Nairobi
Eric Aloysius Finance Group
ronkibbz@gmail.com

Personal financial planning

Most people develop a pattern of financial behavior through trial and error. Although they maintain financial records, often the records are poorly organized and difficult to locate.  Decisions  that are based on these records are flawed, as they do not reflect true financial position of the individual.
Financial planning is the process of developing and implementing a coordinated series of financial plans to achieve financial success.

Benefits of financial planning.
1#. Enables an individual to undertake a self assessment of his financial picture; i.e. understand his cashflow, net-worth, investments e.t.c
2#. Financial planning helps one to attain financial empowerment through increased financial intelligence.
3#. An individual can align financial  goals with life goals.
4#. Gives a clear and realistic financial roadmap to financial independence.
5#. Financial planning can help an individual live a debt free life if properly executed.

Components of a successful personal financial planning.

1#. Specific individual values.
Every person is unique in his on way; people holds different values in life. Financial planning grow out of this values.

2#. Financial goals.
Personal financial  goals should be specific, and realistic in terms of amount of money and time bound. These goals should be consistent with the individual values.

3#. Informed projections about the economy.
While planning its adviceble to consider economic factors such as inflation rate, interest rates e.t.c. 

4#. Consistency.
Financial planning should be consistent and logical. These are predetermined actions in specific situations.

By John Muchiri.

Innovation and business

Innovation is the appilication of the solutions that meet new requirments or existing needs through products, processes, services, technologies, or ideas. All innovation begins with a creative idea: innovation takes that idea, puts it to work.
Innovation in businesses is only beneficial if it has a practical appilication. Innovations in businesses need to be based on the needs of customers if they are to have any use. One of the most common reason as to why businesses fail is lack of viable market i.e. insufficient customers.
Entrepreneurs need to focus on the 'market-based' approach while developing products/ services. It creates the impression that the business is concerned with the needs of its customers.
There is a widely held notion that innovation concerns significant change or a novel concept. This is not necessarily so: innovation can be little repackaging of a product/ service through identifying problems and solving them.
SMEs play a major role in innovating new products, services, and processes. Smaller firms can take up new innovations that are less costly;this flexibility is made possible by the fact that they are small in size.
As an entrepreneur one can capitalize on innovation as a way of having competitive advantage, when price war is not an option. Successful innovation can be a key driver of a firm's revenue: a successful innovation is one that has the customer at its core. Customers' complaints and suggestions can be a source of innovation if viewed positively by businesses.

By John Muchiri.

Investing in Treasury bonds in kenya.

Treasury bonds are fixed income securities.i.e. have a fixed and predetermined rate of return. They are issued by the government through the central bank of Kenya, and have a maturity period of more than 1 year.
Treasury bonds are debts instruments requiring the government to repay the investors the amount borrowed plus interest over an agreed period of time.
There are different types of treasury bonds depending on the purpose, interest rate structure, maturity structure, etc.
The following are treasury bonds issued by the Kenyan government.

Fixed coupon treasury bonds.
Coupon is interest that the issuer (government)  pays each year; normally semi-annually on the face value of the bond.
The minimum investible amount is Kshs 50,000 and can be invested in multiples of Kshs 50,000.

Infrastructure bonds.
Issued to raise funds for specific projects normally stated in the prospectus.

Zero coupon bonds.
They do not have a fixed interest and investor's return is only the discount amount. They are mostly short term and are taken up by commercial banks.

Who can invest in treasury bonds in kenya?
#1. Individuals or corporates holding accounts with a local commercial bank.

#2. Individuals or corporates who do not hold account with commercial banks but invest as a nominee of a commercial bank or investment bank in kenya.

#3. Individuals or corporates holding central depository system (CDS) account with central  bank of Kenya, with minimum face value of Kshs 50,000 except for infrastructure bonds where minimum investible amount is Kshs 100,000.

Emotional Marketing: the hallmark way of winning customers.

By nature human beings are emotional beings. Most people think that the choices they make must result from a rational analysis of available alternatives. Certainly this is not always the case. However, emotions greatly influence and, in many cases, even determine the decisions we make.
As a marketer are you determined to increase your market share? Then you need to understand the psychology of consumer emotions ( personal feelings and experiences) and use it to win over your customers.
Emotional marketing is simply the ability to communicate powerfully through the use of different techniques that evokes emotions. Marketers can build their brands value through innovation, simplicity, and even appealing to the senses, but the challenges is to enrich the stimulus in the message so that it sticks in the long term memory.
Emotional marketing have a significant impact when the consumer experiences a strong and lasting attachment to the brand: it is successful when it triggers an emotional response in the consumer.
Customers want to feel a sense of belongingness and emotional association with a particular brand. They not only want to satisfy their needs but also to feel cared for. You find people having stickers of certain brands in their cars and feeling good about it, this is because of the emotional attachment they have with that brand.
While doing advertsing and promotions a marketer should try to use images, colours, words, and even sound effects that create that emotional attachment. Those messages should convey a feeling of emotional nourishment.

By John Muchiri

Distinctive challanges facing service marketers

Services are acts, efforts or performances exchanged from a producer to a user without ownership rights. They satisfy needs by providing pleasure, information, or convenience.
A firm can provide services to individuals or to other businesses. Also firms that manufacture products can have their own subdivisions that offer services: the subdivisions can offer services needed in the manufacturing process or even to the end users of their products.
Vibrancy in businesses and increased customer awareness of his rights has resulted in need for better service delivery. This has made the service sector to grow by leaps and bound.
Inspite of this growth, the service sector has had its fair share of challenges. Some of these challenges arise from the nature of services which pose distinct  marketing challange.
There exists significant differences between products and services, this fact has lead to a situation where marketers of products and marketers of services are faced with different marketing challenges. Arguably, the challange is even more daunting for service marketers.
These are some of the characteristics of services that influence on how services are marketed.

Intangibility
Unlike in the case of products, customers can not smell, taste, or touch the services. This makes defining a relevant and graspable brand promise all the more difficult, yet all the more essential.
This makes marketing of services difficult due to absence of physical aspects which the customer would have otherwise used to distinguish the service.
The marketer must use vivid images and metaphors in advertising to create ' mental tangibility' .

Perishability
Services involves actions or performance and are transient in nature. Although facilities can be held in readiness to create the service, this does not represent the service itself but productive capacity, in the case of excess demand customers may be disappointed or asked to wait until later.
Service marketers must therefore come up with ways of matching demand for and supply of services through dynamic pricing, promotions, and reservations.

People may be part of the service experience.
Probably you have noted that the difference between one service provider and another lies in the attitude and skills of the employees.
Firms should devote special care to selecting, training, and motivating their employees as they are the people who will be responsible for serving their customers directly.
When a customer encounters other people; employees or other customers, at the service facility, this encounter can influence his satisfaction. How they are dressed, how they behave, or even who they are can reinforce or negate the service 'experience' the firm is trying to create.

Keeping the promise.
Many services are delivered in real time while customers are physically present. This can be defined as 'the moment of truth' ; the firm has to live up to its expectations by giving the best.
Real time interactions are opportunities to strenghten the brand by exceeding expectations or weaken it by under-delivering.
This poses a crucial challenge in marketing of services, unlike in products where goods are produced in a factory, under controlled conditions, and checked for conformance with quality standards.

Inconsistency.
Service is by defination experience-based and is produced and consumed concurrently. Service execution often differs among employees, between the same employee and different customers, and even from one time of the day to another. Also to note is that its execution is influenced by attitudes, moods, skills, emotions of the employee: this brings out the human aspect of services.
This leads to a situation where there are varied opinions regarding services offered by one firm to different customers.
A firm can adopt standardised procedures, train its employees, or even automate to reduce cases of inconsistencies.

By John Muchiri

Business startup ?:mistakes to avoid while writing a business plan.

Often, as entrepreneurs we think i got an excellent business idea, am excited, inspired and poised to take the plunge. The next step that comes in our minds: write a business plan. I strongly believe that sucess of every business lies in planning. Tariq Siddique, puts it this way: ' if you are failing to plan, you are planning to fail.' Ok. While i believe these sentiments, i realize that the importance of business planning has been widely documented; i also consider of great value understanding the pitfalls that entrepreneurs must avoid while writing a business plan.

1. Diluted view about a plan
Well, what is the point of having a business plan? There is a diluted view/mis-information on the need to prepare a business plan, most entrepreneurs think they need one to secure external funding.
It is important that entrepreneurs prepare their own business plan, if consultants are sought to help prepare a business plan, the entrepreneur must remain the driving force behind the plan.
Writing a plan gives you a chance to evalute your idea before you implement it. It provides you a chance to analyse the weakness of your idea, determine whether or not you can overcome them. If you think you can overcome them, you reward yourself with unshakeble conviction. Likewise, if you think you can not overcome the pitfalls, it saves you time, money and energy in the long run.

2. Lack of realistic goals.
Planning entails formulation of goals and directions for the future of a business. Settings goals/objectives is always the first step in planning. While setting goals to be attained, the entrepreneur should ensure that they are specific, measurable, attainable, realistic and set within time parameters. The goals can be short term, medium term or long term, with the most important ones been prioritized. If the goals are set within a given time frame; the entrepreneur can counter check his performance.

3. Failure to anticipate roadblocks

Every entrepreneur will encounter roadblocks as they climb the ladder of success. These roadblocks can be; high inflation rates, high cost of doing business, increased taxes e.t.c.
Oftenly, entrepreneurs while penning their plans overlook this reality when they are emersed in their business ideas. While writing a plan, an entrepreneur should remain objective to consider all scenarios that can impact on his business in the future. This can help in formulating alternatives that might be done to overcome various obstacles.

4. Lack of discipline.
The concept of discipline have been best described by Scott peek, ' discipline is the art of schedling the pains and pleasures in life in such a way as to confront pain first so as to enhance pleasure later.' Although a venture may have started from a hobby or a part-time endeavor, entrepreneurs must be careful to avoid the impression they do not take their venture seriously.
I call it lack of discipline because commitment and discipline compliment each other. Avoid procrastinating activities that are already scheduled

5. Lack of technical experience.
Entrepreneurs should venture in ideas they really have true knowledge of, to avoid being perceived ignorant of the specifics in the proposed business. Venturing in unfamiliar territory might be disastrous, especially where the customers expect quality services and technical support.
In the case where the entrepreneur lacks technical know-how, it is always advisable to get into a partnership with a professional who will compliment  his lack of required skills.

6. Lack of clear market
Well, all business are establiahed with the main objective of making profits. For a business to maximize on profits it has to clearly understand its customers. A successful entrepreneur should have a viewpoint where customers/market are considered crucial and incorporated in  a business plan.
A business plan should  analyse and be able to segment the market in such a way that the business identify a niche for itself.

By john muchiri