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April 7, 2010 / compassioninpolitics

Cell Bazaar: Mobile in Development Case Study

Call Bazaar: Mobile/ITC for Development Case Study

What is the business case for mobile communication and development?

The meteoric growth of mobile phone users in emerging economies has superseded all analyst predictions and future scenarios. The mobile phone has replaced the computer as the fastest-growing technology.Allowing people almost everywhere to stay in touch with family, friends, and customers, and fulfilling myriad other needs, the mobile phone has become theessential technology. In countries like Bangladesh, the adoption curves have been astonishingly rapid, displaying classic “hockey stick” patterns. To take full advantage of this opportunity, we launched the mobile phone based market called CellBazaar in Bangladesh.

One hurdle Cell Bazaar encountered was that people weren’t using the full functionality of their phones. Initially, Cell Bazaar developed a 12 page educational manual but found this presented users with too many options. Later, the company made the move to a one page training:

Amazingly,we lost no essential details in the transition from 12 pages to one: we got better at saying a lot with a
few words and pictures, and trusting that the reader would learn intuitively. Readers only needed the audacity to believe that they could use the market, make money, find goods, and complete transactions.

What is Cell Bazaar:

The CellBazaar service allows people to buy and sell over mobile phones. Nearly 22 million GrameenPhone users can buy any agricultural product,such as rice,fish,or chicken,as well as large-scale purchases like an apartment,land,or car, and consumer goods such as a television or refrigerator.People can also offer services, like tutoring. The service is run by the customers: they post items for sale, delete items after they are sold,adjust prices ifitems fail to sell,and do much more besides.

Over the last year, CellBazaar has grown rapidly; it now has 1.5 million users and averages 90,000 hits a day (including page views and SMS messages). Its registered seller base is 51,000,and its unregistered user base is 30 times that size.

Additionally, Cell Bazaar serves to create fairness and transparency in the marketplace:

CellBazaar was designed to be a marketplace on the mobile phone, reaching a mass population,which would remove the intermediary and give buyers and sellers direct access to one another. By creating an interlinked,multi-industry marketplace that millions could view at the same time, the project would also push sellers toward transparency and push prices toward convergence, so that markets would always be fair ,equitable, and workable.

How Cell Bazaar makes money while doing good:

Right now, our sources of direct revenue are SMS fees (per SMS), IVR fees (per minute), WAP browsing fees (per kilobyte), and targeted advertising. In addition, we have several channels ofindirect revenue,including the voice revenue generat-
ed when a person makes a phone call to complete a transaction (GrameenPhone is now researching the number of minutes generated and amount ofrevenue to share with CellBazaar). A popular consumer item can generate calls from up to 30 callers, and if they begin to negotiate over the price, the calls can last from five to ten minutes. In addition to these existing revenue channels,we see many additional sources ofrevenue that we are currently offering for free. We intend to make the service as popular as possible, and build up a national critical mass. Once the CellBazaar service becomes absolutely ubiquitous and an essential daily tool (i.e., a consumer can no longer imagine doing a buy-sell transaction without us), we can gradually charge fees for add-on services.

The proceeding was a short sample of CellBazaar:A Market in Your Pocket written by Kamal Quadir and Naeem Moheieman of Cell Bazaar. The full original is available for free at innovations by MIT Press in a themed issue entitled “Mobilizing Markets.”

I recommend reading the original article because its great in terms of explaining the challenges for early stage mobile and tech startups as well as the BOP marketplace in Bangladesh.

Kamal Quadir is founder and CEO of CellBazaar. Earlier, he interned at Insight Venture Partners in New York, led the Business Development Division of Occidental Petroleum’s initiative in Bangladesh,and worked for New York City’s Chamber of Commerce.

Naeem Mohaiemen is Vice President of Business Development and Marketing at CellBazaar. He worked on digital media and convergence projects in New York at Mercer Consulting (Marsh & McLennnan), HBO, and Time Warner Cable.

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