Who's winning the classifieds market in Morocco?
"We’ve never seen competition like this in Morocco." These
are the first words MarocAnnonces founder Tajdine Filali said when
asked about the classified sector in Morocco.
Once, there might have been 250 different classified websites, of all sizes and quality. But today, the story of classified ads is the story of David versus Goliath. Well, two Goliaths. Marocannonces.ma, which launched in 2000, was founded by local entrepreneur Tajdine Filali, and bootstrapped from the beginning.
Now, two giants have entered the market. Avito was launched in 2007 by two Swedish entrepreneurs and is now the 5th most visited website in Russia. Bikhir, part of the Norwegian Schibsted Group, owns leading classified sites across Europe, and sees 5,000 new listings per day, says General manager Larbi Alaoui Belrhiti.
Both have hit the ground running; Avito.ma is leading the market with 3.2
million unique visitors per month, an expected 16 MAD billion (US
$2.11 billion) worth of transactions in 2014, which will
represent 2% of Morocco’s GDP in 2014. Just ten months after
its launch in July 2012, it's the second most visited website in Morocco.
Despite the hefty competition, Filali remains optimistic, as his number of listings remains unchanged at 3,000 a day.
The market on the whole should continue to grow, as internet access continues to improve; 39% of households have internet access today.
And three websites have at least one thing in common: they’re not afraid of putting in time and money to reach the number one spot. "It’s not a sprint, it’s a marathon. It’s a long battle," says Alaoui Belrhiti. Who will win?
For Moroccans, by Moroccans?
"We sell anything from camels to cars," jokes Ben Abla. The three websites offer a similar free service for people to buy or sell anything they own in person (anything legal that is).
They also strive for the same image: being seen as a local brand close to people. This image is easier for MarocAnnonces, which has been present in the market for 13 years and has never received an outside investment from anyone.
Avito and Bikhir's managers both believe they have already reached that goal, thanks to their entirely Moroccan team. The two services are also being discreet about their international origins.
Each platform has its own formula for for making sure it's the
best: Avito says its team goes through listings 24/7 to and
validate the best ones, while at Bikhir, Alaoui
Belrhiti brags that the 15 people validating listings
are really strict to avoid any fraud or illegal sales.
Filali from Maroc Annonces, on the other hand, says their 13 years of local experience and his “secret recipe” make the difference.
As people begin to trust these platforms more and more, these three players will need to focus on other ways to differentiate their strategies.
A powerful name vs. intensive marketing
Avito.ma and Bikhir both believe that the only way to keep the market’s momentum is to educate consumers in Morocco through expensive advertising.
Both of their parent companies are ready to invest in their Moroccan branches to help them take the lead. Avito.ma recently launched a TV ad campaign, and has signed a partnership with Haja El Hamdaouia, a popular Moroccan pop singer.
Bikhir likewise is capitalizing on mediums besides internet to promote their brand: "Mass-media campaigns, like TV or radio, could be happening soon," says Alaoui Belrhiti.
Their large budgets are also being put to good use to differentiate elsewhere. Bikhir has developed a new mobile app, while Avito.ma is investing in partnerships, including one with Voituresmaroc, the #1 car sale classified website in Morocco.
Maroc Annonces can’t compete with the other guys when it comes to marketing. But Filali says their trusted name and word-of-mouth is enough to get the results they’re looking for. "Today, everybody knows MarocAnnonces; the name speaks for itself," he says. But MarocAnnonces’ transactions have not increased at the same rate as its competitors. Filali might says he’s content with that, but in the long term the site may need a new strategy.
What’s next: buyouts and closures?
Giants Avito.ma and Bikhir are spending quickly and in no hurry to break even. "The most important thing to us is to continue investing and making sure the market reaches a mature state. Once we reach that point, we’ll start thinking about breaking even," says Ben Alba.
But can a smaller and less aggressive company like MarocAnnonces survive Avito and Bihkir’s aggressive user acquisition campaigns?
Last March, a rumor spread that Maroc Annonces was going to be sold to Avito.ma for MAD 15 million (almost $1.7 million). Avito.ma denied it. "For the moment we’re not interested in acquiring one of our competitors,” clarified Ben Abla, adding that "this deal was never discussed and will not happen for now." But Filali is definitely keeping his options open for Maroc Annonces; he mentioned possible offers to be acquired and that he is looking into fundraising.
Smaller company Souqaffaires.ma may be raising money currently, and regional Dubai-based platform Dubizzle once considered Morocco. Dubizzle tried to enter the market but, cofounder J.C. Butler explained, "decided not to pursue it - we stopped all activities there about a year ago."
Both of these major players admit that their larger goal is to reach Africa. Avito launched in Egypt under the name Bekam in December 2012 where it faces fierce competition from Dubizzle. When asked if Avito will launch in other countries, Ben Abla replied with a non-committal “we’ll see.” Their parent company, the Norwegian Schibted Group, has already taken the jump as they launched beta classified sites in Algeria, Tunisia, Egypt and Nigeria.