Lagos SMEs urged to prioritize innovation and repeat customers

A study by Nigeria’s National Institute for Legislative and Democratic Studies indicates that small and medium-sized enterprises (SMEs) in Lagos must prioritize entrepreneurial innovation over rigid strategic planning to survive economic instability. Research led by Ibrahim Ayodele Yusuf suggests that while formal planning aids organization, the ability to adopt new products, services, and processes is the strongest predictor of business resilience.

However, the effectiveness of these business strategies is often hindered by institutional challenges, including inconsistent government policies and regulatory hurdles. The findings suggest that in volatile environments, agile and adaptive models are more effective than traditional top-down frameworks.

Complementing the need for innovation, business analysis highlights the importance of shifting from transactional selling to lifetime value management. For many African SMEs, high customer acquisition costs often erode profit margins. Transitioning focus from one-off sales to repeat purchase strategies can create more predictable revenue streams and improve the ratio of Customer Lifetime Value (LTV) to Customer Acquisition Cost (CAC).