Case Study: JUMO’s Dynamic Pricing Strategy

Course Content
Introduction to Marketing – Week 1
Principles of Marketing introduces students to the core concepts and strategies that are fundamental in today's ever-evolving business world. This course emphasizes the importance of understanding and applying key marketing principles to establish and maintain long-term customer relationships, and to effectively communicate value to target audiences. Students will engage with the processes involved in identifying target markets, developing a marketing mix, and analysing market opportunities and challenges.
The Marketing Environment
Macro and micro environmental factors The marketing environment encompasses all external factors that influence an organization's marketing decisions and actions. These factors can be broadly categorized into macro and micro environmental factors. Each has a direct or indirect impact on the company's ability to serve its customers and achieve its objectives. Understanding these elements helps businesses adapt, strategize, and capitalize on prevailing market conditions.
Market Research & Information Systems
Market research and information systems play a pivotal role in helping organizations understand their audience, make informed decisions, and stay ahead in an increasingly competitive business environment. These tools provide valuable insights into market dynamics, customer behavior, and emerging trends.
Consumer Behavior – Week 2
Consumer behavior refers to the selection, purchase, and consumption of goods and services to meet consumer needs. By understanding why consumers make certain decisions, marketers can develop more effective strategies to target their audience. Factors influencing consumer behavior can be broadly categorized into psychological, social, and cultural factors.
Market Segmentation, Targeting, and Positioning
The Market segmentation, targeting, and positioning (STP) process is a strategic approach used by marketers to identify distinct market segments, select specific target markets, and craft a unique positioning strategy. Together, these elements form the foundation of a company's marketing strategy, ensuring that products or services meet the specific needs of the intended audience.
Product: Concepts, Strategies, and Life Cycle
In the marketing mix, the product is the tangible (or intangible in the case of services) offering that a company provides to its customers. Understanding the product, its strategies, and its life cycle is crucial for marketers to ensure continued relevance in the market and sustainable growth.
Pricing Strategies and Decisions – Week 3
Pricing is one of the most crucial elements of the marketing mix, directly impacting revenue, profitability, market share, and even brand perception. Establishing the right price for a product or service is a blend of art and science, and it's influenced by various internal and external factors.
Promotion: Integrated Marketing Communications (IMC)
Promotion, a fundamental element of the marketing mix, ensures that consumers are informed, educated, persuaded, and reminded about a brand, its products, or services. Integrated Marketing Communications (IMC) is a concept that embodies the blend of all promotional tools into a seamless program designed to maximize the impact on consumers at minimal cost.
Digital Marketing and E-commerce – Week 4
In the modern digital age, the way we market products and make purchases has been revolutionized by the rise of digital marketing and e-commerce. Understanding these realms is essential for businesses aiming to stay competitive in today's market.
Global Marketing
In a world that is increasingly interconnected, businesses are seeking to tap into the global market to expand their reach, diversify their portfolio, and increase their profitability. Global marketing is the process of conceptualizing and then conveying a final product or service worldwide with the hopes of reaching the international marketing community.
Ethical and Social Responsibilities in Marketing
In the age of digitalization and consumer empowerment, businesses are under greater scrutiny for their marketing practices. Ethical and social responsibilities in marketing are not just about adhering to legal regulations; they're about aligning business practices with the values, morals, and expectations of stakeholders and the broader society.
Branding and Brand Equity – Week 5
In a world saturated with products and services, distinguishing oneself can be a daunting task for businesses. This is where branding, and the resultant brand equity, play a pivotal role. They offer a beacon of identity in the crowded marketplace and ensure a product or service doesn't just remain a commodity.
Services Marketing
In an era dominated by the service industry, understanding the nuances of services marketing is crucial for businesses to thrive. Unlike tangible products, services are intangible, making their marketing inherently different and challenging. This uniqueness requires a distinct approach to ensure customer satisfaction and loyalty.
BUSA 330 Principles of Marketing
About Lesson


JUMO is a leading fintech company operating across several African countries. With a focus on providing micro-loans to individuals and small businesses, the company has harnessed data and technology to build a dynamic pricing model that adjusts loan interest rates based on multiple factors, ensuring a balance between risk management and competitive pricing.


Established in 2014, JUMO noticed that traditional banking systems in many African countries were often out of reach for the common individual, especially in rural areas. With the rise of mobile money platforms, there was an opportunity to offer financial products to a previously underserved market segment.

The Challenge:  

Pricing in the microfinance sector is a delicate balance. Set rates too high, and potential customers might shy away or could struggle with repayments. Set them too low, and the risk might outweigh the reward, especially given that many of these loans are unsecured. Moreover, competitors were emerging rapidly, making the pricing landscape even more challenging.

Strategy Implementation:  

  1. Segmented Pricing: JUMO segmented its audience based on credit history, the amount borrowed, and loan duration. Repeat customers with good repayment histories enjoyed better rates.
  2. Dynamic Pricing: Using algorithms and real-time data, JUMO could adjust interest rates based on prevailing market conditions, competitor rates, and customer risk profiles.
  3. Psychological Discounting: To promote larger loan amounts or longer repayment durations, they employed tactics like “Borrow for 3 months, and get a 1% discount on your interest rate.”
  4. Seasonal Pricing: Understanding the agricultural backbone of many African economies, JUMO offered reduced rates during planting seasons when farmers needed capital and could repay after harvest.


JUMO’s dynamic pricing strategy proved effective. They maintained a low default rate compared to the industry standard. Their customer base grew, with a considerable percentage being repeat borrowers. Additionally, their flexible pricing acted as a competitive barrier, setting them apart in a crowded marketplace.

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