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Vodacom Market “Leadership” claim is a misnomer

Discussion in 'Habari na Hoja mchanganyiko' started by ByaseL, Nov 30, 2009.

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    ByaseL JF-Expert Member

    Nov 30, 2009
    Joined: Nov 22, 2007
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    VodaCom: “The leading network in Tanzania” (VodaCom Mtandao Unaoogoza Tanzania) reads the marketing motto of one of the most agile mobile phone companies in Tanzania. The chest thumping slogan ostensibly speaks volumes about VodaCom as a corporate citizen and a service provider in this country but in a nutshell it simply implies that VodaCom is a “leading” communications network in the country and other players like Zain, Tigo, Zantel and the Johny-come-lately TTCL are only playing second fiddle at best. This begs a question. Is VodaCom a leading network in Tanzania in a strict sense? In this perspective I will endeavor to explore the “leadership” aspect of VodaCom in one of the most fiercely competitive industries in Tanzania.

    Let me declare from the outset that I am an ardent customer of VodaCom and what I going to say here may contain some bias for or against VodaCom. My discourse in this regard will, by and large, focus on the marketing dynamics of VodaCom Tanzania viz a viz its competitors.

    VodaCom’s eye catching motto invokes an instant impression that it has biggest market share in terms of customer subscriptions and network coverage. I have no reason to doubt this statement of fact because it can easily be proved by simple statistics. In any case had it not been true, I believe VodaCom competitors would come out guns blazing to contest this as a fallacy. So in this context we can rate VodaCom highly on a leadership “scoreboard”.

    However, market share dominance alone can sometimes be illusionary. For instance, I am not sure where to place VodaCom when it comes to market deepening. By deepening I mean how far and wide does the VodaCom network go in terms of reaching every place and corners in this country? Whereas you will find VodaCom communication services in almost all urban areas in Tanzania the converse is true for the remote places in this country. In the remote rural areas I get the impression that Zain reigns supreme. Deep in the villages you hardly find a person with any other network other than Zain because that is the only network that works there. Indeed if this is the case one may conclude that the reason why VodaCom takes the lead in terms of market share is because its customer base is generally concentrated in metropolitan centres where many people can afford to buy a phone as opposed to the remote rural areas where the disposable income is relatively lower. Nevertheless, in my view, in terms of market deepening Zain gets the compliments due to its ubiquitous network in the whole country.

    As mobile phone consumers in Tanzania we have come a very long way. Gone are the days when service providers would take the customers for granted and charge exorbitant rates thanks to competition. I am of the strong view that the customer benefits that we see today are a result of the cut throat competition amongst the key players in the mobile communication industry. My take on this is that Tigo is leapfrogging the rest of the competitors as far as marketing improvisation is concerned. Tigo has the most innovative and consistent marketing strategy in the marketplace. From a seemingly underdog position two years ago, Tigo has grown into a formidable force to reckon with thanks largely to its Extreme marketing drive. I have witnessed so many people become Tigo converts never to ‘return’ to their original services providers. Alarmed by customer exodus Tigo competitors are not taking it lying down and are fighting tooth and nail to woo back old customers and create new ones as well. The Cheka and Pamoja (just to mention two) campaigns by VodaCom and Zain respectively are knee jerk reactions to forestall Tigo’s market onslaught.

    I want to be candid here. I have qualms with VodaCom promotion campaigns. I always find its promotion stints a bit eclectic and very short lived. Examples abound. VodaCom’s Chirizika Promotion came and went at the blink of an eye or was “beeping-like”, if you wish! While the VodaCom SMS voucher product was getting popular by the day it was withdrawn from the market unceremoniously and left many voucher vendors licking their wounds. The Vodacom “Tuzo Points” scheme though very enticing is not running smoothly. For example, customers who redeemed their ten thousand points for mobile phone rewards had to frequent VodaShops for more than a month while being told “njoo kesho” ( come tomorrow) by customer service agents with no etiquette whatsoever, because the phones in question were out stock! I could not understand why a self acclaimed top notch marketing company like VodaCom could bite more that it can chew. VodaCom’s new “Cheka” promotion is in its infancy and is fraught with some teething problems.

    Nevertheless, I have high regard for VodaCom for its M-Pesa product which has indeed revolutionalized the monetary movement system in the country. The VodaCom Foundation concept is a very brilliant idea and clearly shows how the company values its corporate responsibility. However, methinks, a big hand should go to Tigo in this regard for its resilient and consistent marketing strategy which is slowly but surely paying off and giving Tigo competitors a run for their money.

    My last take on VodaCom “leadership” aspect today is its services availability within East Africa. VodaCom Tanzania has connectivity partnership agreements with MTN (Uganda) and Safaricom (Kenya) in Uganda and Kenya respectively. VodaCom customers traveling to Uganda and Kenya are able to access VodaCom services and the arrangement seems to be running smoothly except when it comes to loading airtime. However, Zain customers seem to get a better deal by a getting a seamless service around East Africa because Zain is well established in all three East African countries. My personal experience corroborates this. Whenever I travel to Uganda, I normally borrow a Zain Sim Card because I find it to be more user friendly than VodaCom’s. This is another area where I vote for the Zain network because it has a clear edge over the competition.

    It is quite evident from the above scrutiny that the self proclaimed leadership by VodaCom Tanzania as the leading network in the country does not measure up to market leadership criteria as far as the mobile communication industry is concerned. Having said that, it is important to acknowledge the great role VodaCom has played so far in the development of the communication industry in the country and my downbeat observations should in no way be construed to be taking anything away from this great company. However, for VodaCom to simply claim market leadership on the basis of market share alone while under performing in other critical marketing areas is some kind of a misnomer. It is akin to blowing your own trumpet even before the start of the parade show!

    Byase Luteke