Online company Jumia Group early this month, was named among the MIT Top 50 Smartest Companies for the second consecutive year in a ranking that can play an important role in building consumer trust in the brand, according to research.
“A company ranked, for instance among MIT’s Top 50 Smartest, has its innovativeness tried and tested and its impact felt globally. It is an assurance of its value in the market it operates, having exhibited astute business leadership over the years under observation. It presents the company with an opportunity to receive further recognition from prospective customers and investors, thus profitable new growth,” said Cyrus Onyiego, Country Manager for Jumia Travel Kenya.
The MIT Top 50 Smartest Companies is a list put together each year by the editors of the MIT Technology Review magazine, a product of the Massachusetts Institute of Technology (MIT).
The institution is a private university in the US that specialises in research in the physical sciences and engineering.
The list identifies global companies that are creating new opportunities by combining important technologies and are business savvy.
Space X, Amazon and Alphabet were among the top five companies on the MIT list this year.
Jumia Group, due to its online platform that has consolidated all its consumer web services — shopping, travel, food delivery, real estate sales, and car rentals—under one name, was ranked at position 44, up from 47 last year.
This year’s recognition comes after the company in April this year, reported a net loss of Sh12.4 billion for the year to December, and a reduction in its customer numbers, although its total transactions grew by 4.3 per cent. The ranking, therefore, is expected to lift the company’s fortunes.
“We are proud for the recognition of our persistence in fully harnessing Africa’s untapped digital potential. We believe that through technological innovations, we drive our commitment to inject feasible solutions into Africa’s economy,” said Sacha Poignonnec, Jumia Group’s co-founder.
For companies, such rankings are an opportunity to increase brand awareness and visibility, which can have a positive effect on sales.
According to Robert Schindler, a professor of marketing at the Rutgers School of Business–Camden, the rankings illustrate the quality of a product and increase the desire by customers to purchase the better product.
“Ranked lists represent a quick summary of a lot of information. At a glance, consumers can see where the items they are looking at fall in comparison to other products. They use that information to make judgments on products and respective companies” he said.
In a study Schindler conducted titled, The Top 10 Effect: Why Consumers Depend on Rankings, he found that rankings affect product sales, as products ranked on lists generally sell better than those that are not ranked, with consumers forming a bias towards the ranked products.
In the case of Jumia Group, it experienced improved results when it was ranked 47 in last year’s MIT’s Top 50 Smartest Companies.
Its Jumia Travel platform recorded a 55 per cent rise on consumer traffic to its website within the period June 2016/2017.
“...the ranking has also resulted in improved trust of the online booking services, with a 40 per cent growth in the conversion rate, compared to the previous year. The global recognition acted as a guarantor to Jumia travel’s legitimacy, in turn boosting confidence in online payment with 40 per cent of customers paying online as opposed to 20 per cent in 2016,” said Onyiego.