• About Hisa Technologies
  • Advertise
  • Careers
  • Contact Us
  • Estate Cloud
Friday, February 26, 2021
  • Login
  • Register
No Result
View All Result
NEWSLETTER
Kenyan Wallstreet
  • Home
  • News
    • Kenyan News
    • African News
    • Global News
  • Business
    • Agriculture
    • Banking
    • Aviation
    • Energy
    • Manufacturing
    • Markets
    • Personal Finance
    • Technology
    • Startups
  • Podcast
  • Videos
  • Events
  • Blockchain & Digital Currencies
  • Home
  • News
    • Kenyan News
    • African News
    • Global News
  • Business
    • Agriculture
    • Banking
    • Aviation
    • Energy
    • Manufacturing
    • Markets
    • Personal Finance
    • Technology
    • Startups
  • Podcast
  • Videos
  • Events
  • Blockchain & Digital Currencies
No Result
View All Result
Kenyan Wallstreet
No Result
View All Result

How Safaricom built an unrivalled communication network & digital ecosystem

Kenyan WallStreetbyKenyan WallStreet
August 28, 2018
in Kenyan News
Reading Time: 4 min
How Safaricom built an unrivalled communication network & digital ecosystem

On Monday last week, Fortune released its 2018 ‘Change World’ list that ranks for-profit companies that are making great social impacts in the communities that they operate in. Interestingly on top of the list was Reliance Jio, a company that is disrupting the India telecommunications sector where Bharti Airtel has had unrivalled market leadership for decades. Jio has garnered over over 220 million subscribers in less than 24 months as it continues with its leadership in cheap and quality calls and data. Kenya’s Safaricom  and its parent company Vodafone were ranked number 19 in the list for pioneering mobile money transfer service that is now being used in over 10 countries deepening financial inclusion and changing livelihoods. The question remains how did Safaricom achieve this?

Over the the 10 years, Safaricom has invested over $250m annually in telecommunication infrastructure and continuous innovations at a faster pace than all its competitors combined.

ADVERTISEMENT

Ownership of telco infrastructure per telco

Chart of number of transceivers own by each telco

The growth in infrastructure has been matched by an exponential growth in customer numbers as Safaricom has continued to offer distinctive products and services such as per second billing, Mpesa, robust agency rollout and distribution network. Safaricom has got regional offices across all regions in Kenya, deepening product and services offering as well as customer service outreach.

M-Pesa

The greatest asset that Safarciom has is differentiating itself from competitors by leveraging network power and strong channels. Network power is very powerful in technology adoption. Let us look at Mpesa adoption for an example. With urbanization growing, many people had moved to towns and they had dependants that they sent money to in rural areas. The existing means of sending money before 2007 were money orders, bus company courier services, friends and relatives etc , which were inferior to Mpesa. So the urban people found a better way of sending money and influenced their dependants in rural places to register for Mpesa services and Mpesa got its popularity from this network of people. Mpesa created trust by sending a message for confirming that the money was successful sent unlike the by then existing means creating an unmatched trust and user experience. It became literally socially unacceptable not to have M-Pesa. An unassailable network and ecosystem was created.  It is the “Uko na mpesa?”,(Do you have Mpesa?) “Kwani hauna number ya mpesa” (Do you have Mpesa?) that created this network power where consumers influence other to join and the rest is history.  This is the magic of technology adoption. Market forces at work. Never has it been about seeking regulatory intervention, something that Airtel has been accustomed to despite its clearly inferior investments in network infrastructure and distribution channels.

Telco, like fast moving consumer goods industry thrives on distribution channels. There is always a Coca cola deport a few kilometers away. The same model is used by East African Breweries in ensuring that their products reach even the remotest parts of the country. It rides on segmenting the country of operation into regions then regions into territories. Distributors are then allocated into each territory and they work with territorial sales managers to ensure that products are delivered to retailers who sell to customers. If there is a need, territorial sales managers are allocated trade developers to help the distributors with pushing the products to retailers and customers as well as initiating localised campaigns and product awareness. With this model, distributors’ economics must be looked at and they must be given incentives to push the product to retailers and customers. With the right incentives, this network is able to grow exponentially and become robust as have in the cases for Safaricom, Coca Cola, Univeler and EABL in Kenya.

Over time, the Mpesa, voice, sms, data and other services offered by Safaricom have created a distinctive advantage for the company arising from years of well calculated moves. Mpesa for example has grown from being just a P2P money service into a key payment medium at national and international level.  Banks are using the Mpesa API for bank to mobile transactions as well as a channel for mobilizing cheap deposits. Government and private companies are using for collections. Mobile loan lenders like Branch and Tala, are using the service as the only channel to credit loan to customer accounts as well as receive loan repayments.  Interestingly, Safaricom annual revenues have been 3 % of GDP since 2016.

MPESA ECOSYSTEM

RELATED; How did Safaricom become Kenya’s most successful Telco?



Hisa App
Previous Post

Vodacom Introduces Africa’s First 5G Broadband Service in Lesotho

Next Post

UAP Old Mutual Half Year 2018 Earnings Plunge by 61%

Related Posts

KenGen Delays Release of Financial Results

Kengen’s Half-year Net Profit Dips by 38% to KSh5 Billion

February 26, 2021
Unga

Unga Group Plc Half-year Earnings drop 44.8% to KSh 83.5 Million

February 26, 2021

French Group, EDF Acquires Stakes in 2 Kenyan Energy Companies

February 26, 2021

CBK Collects KSh 26.7 Billion from Weekly T-Bills Auction

February 26, 2021

Kenya Power Posts KSh593 Million Drop in Half-Year Revenue

February 26, 2021

Portland Cement Posts KSh1 Billion Half-Year Net Loss

February 25, 2021

Nation Media Group Shares Rally on Share Buyback Announcement

February 25, 2021

Wealth Report Shows Population of Wealthy Kenyans Dropped by 22% in 2020

February 25, 2021
Load More
Next Post
UAP Old Mutual Half Year 2018 Earnings Plunge by 61%

UAP Old Mutual Half Year 2018 Earnings Plunge by 61%

Follow Us

  • 7.1k Fans
  • 113.3k Followers
  • 2.3k Subscribers
  • 453 Followers

WhatsApp

Subscribe

Telegram  

Subscribe

Podcasts

Upcoming Events

There are no upcoming events.

View Calendar
Add
  • Add to Timely Calendar
  • Add to Google
  • Add to Outlook
  • Add to Apple Calendar
  • Add to other calendar
  • Export to XML

Featured

Gamestop

Can the Gamestop Situation Happen in Kenya?

February 21, 2021
Hisa App

Announcing Hisa App Public Beta Launch

February 20, 2021
Absa Kenya CEO Jeremy Awori

Absa Marks One Year Since Transition, Commits KSh1.6 Billion into Digital Products

February 11, 2021
NSE Derivatives

How To Make Money Trading Derivatives In Kenya

February 9, 2021
Leila Fourie, JSE Group CEO

‘’Markets Recovery Don’t Imply Economic Recovery,’’ Leila Fourie, CEO Johannesburg Stock Exchange

December 31, 2020

About Us

We are a leading integrated digital content platform providing in-depth business and financial news across Sub-Saharan Africa & the globe. Kenyanwallstreet.com is a property of Hisa Technologies Ltd, a financial media & software company.

Contact Us

Kenyan Wall Street
Email: [email protected]
Website: www.kenyanwallstreet.com

Disclaimer

The information contained in this website is for general information purposes only.
Read more..

  • About Hisa Technologies
  • Advertise
  • Careers
  • Contact Us
  • Estate Cloud

Copyright 2021. Hisa Technologies. All Rights Reserved.

No Result
View All Result
  • Home
  • News
    • Kenyan News
    • African News
    • Global News
  • Business
    • Agriculture
    • Aviation
    • Banking
    • Energy
    • Global Markets
    • Healthcare
    • Infrastructure
    • Insurance
    • Investment
    • Manufacturing
    • Markets
    • Public Policy
    • Real Estate
    • Startups
    • Technology
  • Podcast
  • Videos
  • Events

Copyright 2021. Hisa Technologies. All Rights Reserved.

Welcome Back!

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Fill the forms below to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?