As with many start-ups that taste early success and become targets for acquisitions and sustained growth, the company soon lost the edgy nature that had allowed it to understand its market and build a platform that would appeal to the market. With time and growth the moneymen came in and the culture became more corporate, which did not allow the same maverick development due to corporate leadership and far more media scrutiny. This is often a recipe for success for certain start-ups, but for Mxit, it simply added pressure.
The original success of Mxit was built on the perfect conditions related to the SA market, with data prices decreasing and a young target base that was keen to have a platform to chat to each other with ease embracing the software wholeheartedly. In 2013 the company reported that its monthly active user base was 7.5 million, but this figure fell to just 1.2 million monthly active users by July 2015, as many of the original users outgrew the app and moved on to other platforms that were geared towards a wider market.
Mxit was originally built on feature phones, as it appealed to teenagers who were looking for a cost-effective means of communicating with each other. With the advent of the smartphone era, early adopters quickly embraced the early smartphone models, while smartphone and tablet technology began its rise in the mainstream. Mxit was a platform built to cater largely for the Nokia-era feature phones that used the outdated, and very slow J2Me development language, and this was left behind by a new smartphone wave that would drown out Mxit’s original success.
Many seem to believe that Mxit would still be enjoying incredible success if they had acted two years sooner, especially with regards to catering for the smartphone user segment. The business model at the time meant that there was a split focus between trying to build a coherent smartphone app, while keeping the loyal feature phone user base content and catered for. As the stable user base from feature phones was the segment bringing in the most money, investors wanted them taken care of, but this hampered Mxit’s ability to innovate and look to the future.
Mxit’s decline in user loyalty began with the emergence and popularity of BlackBerry Messenger (BMM) five or six years ago, and they have been struggling to gain users ever since. The explosion in popularity of newer platforms such as WhatsApp, WeChat and Facebook Messenger finished off the ailing South African app. According to research from World Wide Worx and Fuseware, WhatsApp enjoys the patronage of over 10 million users in South Africa, while Facebook has 13 million users in the country who have access to their platform.
Mxit’s ability to innovate was a problem, but added to that, it seemed that they app did not have a clear focus either. Due to decision makers at the top being unable to agree on a solid path, the app was a mix of three social networking aspects. A private messenger which allows you to chat to people you know, an open platform for companies to engage with communities in real-time and a space for public chatrooms co-existed on the app, and neither of these elements seemed to take centre stage, and perhaps that lack of focus did more damage than good.
Many analysts and tech experts have commented on the fact that the company and many of its leaders seemed to favour the potential of the Reach Trust (charitable arm) over commercial success. The Reach Trust uses Mxit’s technology to give more than 500 000 learners access to educational apps on the platform every month, according to Mxit’s statement. This is an excellent tool for education accessibility, and perhaps this emphasis was a contributing factor to Mxit’s demise as a commercially viable entity.
