Sunday, 24 March 2013

Market positioning in the Kenya telecommunication consumer markets

The Kenyan telecommunication industry which features several firms like Safaricom, Airtel and Orange offer a variety of products and services to their target market. Among some of the services offered include mobile communication, fixed line communication, data and mobile money services. The firms have continued to compete by positioning themselves within the market through changes in the marketing mix elements price, place, product and promotion. The telecommunication firms seek to offer competitive prices of their products and services, superior products, stronger networks in terms of distribution and effective promotion to reach their customer market. This can be best explained through the following cases of the firms as they interact with their market and changes they make to ensure they develop and maintain a competitive edge.
Price: Airtel moves to increase its tariffs
In a recent twist of events Airtel Kenya announced an increase in their prices which will place them slightly higher than that of the industry leader Safaricom. Although Airtel has not confirmed a change in strategy this move signifies an attempt to stop the price war. The move to increase tariffs on its major tariffs (Klub 254 and Vuka) is likely a result of the need for the firm to invest and improve the quality of its data products. But the company still maintains the low pricing strategy on its (Tosha) tariff for competitive advantage on cost leadership within the customer market.
Product: Safaricom Product innovation M-PESA/ M-SHWARI
Safaricom through introduction of its M-PESA Product placed Kenya on the world map as the first country in the world to use the service. M-PESA allows its subscribers to use their mobile phones to access banking services where the user can send and receive money on their mobile phones. M-SHWARI which is a complementary product offers the ability to save and earn interest for their users.  This shows a commitment by telecommunication firms to improve their products to attract more customers.
Place: $293m investment by Safaricom to improve its network coverage
Safaricom recently invested $293 million to improve its network and make it the best in the country. In a statement by its CEO Bob Collymore, the company has increased its sites to 2,905, 1,604 of these are 3G enabled and this has improved the distribution of their products and services to reach more customers in the market.
Promotion: Digital promotion
Firms within the telecommunication are increasing the use of digital platforms for promotion. All the companies have an online presence through their websites and social media profiles. They use these platforms to engage with their customers who prefer interactive channels of promotion instead of the traditional static methods. Digital platforms have offered the firms an opportunity to interact in real-time with their customers.


Thiong’o, P. (2013). Will Airtel kenya’s move to raise call rates end price wars among telcos?. The East African.
Institute of Developing Economies- Japan External Trade Organizations. (n.d.). Safaricom Limited

Sato, N. (2013). Safaricom in $293m investment to have “best network in Kenya”. Human IPO.

Thursday, 24 January 2013

Business strategy in relation to organizations

A strategy is a game plan used by an organization to achieve its desired objectives within a specified period of time. Strategy is about shaping the future. It is actually the human attempt to get to desirable ends with available means (McKeown, 2011). It is the overall scope and direction of a corporation and the way in which its various business operations work together to achieve particular goals. According to Porter (1996), “strategy is the creation of a unique and valuable position, involving a different set of activities”. The word creation in his statement infers that a strategy involves making choices after evaluating a set of available actions.
Strategy may be looked at from two perspectives;
1.      A method or plan chosen to bring about a desired future, such as achievement of a goal or solution to a problem.
2.      The art and science of planning and marshalling resources for their most efficient and effective use.
Tactics are employed in decision making process, to make an accurate forecast of the future of the business (Masanell & Ricart, 2009). It highlights the core purpose and objectives of the organization and what exactly needs to be done in order to realize those goals. Resources necessary are allocated. Tactics are employed to ensure that the strategy objectives and goals are met.
Values: are the fundamental beliefs of an entity. They are the principles we use to define that which is right, good and just. Values provide guidance as we determine the right versus the wrong, the good versus the bad. They would refer to acceptable standards within the workspace which govern the behavior of the individuals within the organization (Putnam, 2011). These values must be within the organization’s purpose, mission and vision. Ethical considerations that act as a guide to the behavior and morals of all the stakeholders in the organization an organization’s values are largely set in its culture and traditions. Organizations values are the foundation of the organization and are determined by what customers expect in their day to day interactions with the organization. Examples include:
·         Customer centered care
·         Empathy
·         Development
·         Enthusiasm
·         Partnership
-An organization's values should be clearly outlined in their mission statement as a way to build commitment in its adoption within the fabric of the organization.
Values ensure the health and wellbeing of the firm in the long run.

Concept value of firms expands beyond economic value to include other forms of value such as employee value, customer value, supplier value, channel partner value, alliance partner value, managerial value and societal value.

Saturday, 26 May 2012

Business Product Strategy: A case on Magneto

Product attributes

This would involve the features or characteristic of the product. Before Magneto goes into production they need to understand the ability for the product to fulfill the needs of the customer
Quality – the major tool in positioning your product. It encompasses two key elements: 1) quality level - how it is made or perceived, and 2) quality consistency - how it performs over its life.
Features – the physical or intrinsic characteristics of your product that contribute to the benefits it offers.
Design – a combination of how the product looks and how it performs.
• Branding
A brand is a name, term, sign, symbol or design, or a combination of these elements that identifies the maker or seller of a product or service. Branding is an important part of a product and contributes to its personality and perceived value. The power of a brand cannot be underestimated – many people buy on the strength of brand alone with no regard for price or performance.
• Packaging
Packaging incorporates the wrapper or container for your product. It serves to protect the product, ensuring it reaches the buyer in good condition and also conveys the personality of your brand and important safety and statutory information.
• Labeling
Labeling incorporates all the written information about your product and usually takes the form of an adhesive sticker, a tie-on tag or a printed piece of packaging.

The characteristics of the target market

The characteristic of the target market or the product’s potential customers is an essential part of the product strategy. This is because the company needs to understand the potential customers’ needs and their characters for the purpose of developing a product that this group can connect with. Magneto will need to consider their geographical locations which may encompass region, climatic conditions and so on, demographics which may include their age, gender among other variables, psychographics which includes the general personality and lifestyle, behaviors which includes their level of knowledge and attitude.

Market share objectives

Magneto will need to place focus on their market forecast for this product and their market share intentions. This will depend on whether they need to achieve market share dominance or they will just pursue profits or both. Market share objective will involve determining the size of the market and estimating how much of that market Magneto will require to meet their corporate and product goals.


Magneto will need to understand the competitive environment within the product category and class. In case Magneto is the pioneer for the said product they will need patents to protect their product from competition if this is not possible then they should gather information about other companies that are more likely to produce a similar product. This will enable them develop their product with strong features to withstand the threat. Competitor analysis makes up for an important part of product strategy because it seeks to offer insights on how well to beat the competition through taking advantage of their weaknesses and the opportunities that generally exist in the market.

Desired product positioning

This will involve the development of a unique selling preposition about the product. The product by Magneto can be positioned on the basis of an attitude or benefit, use or application, price or level of quality. The positioning should play to the company’s product strength and away from weakness.

Profit objectives

Depending on the product Magneto is making they may not be able to set their own prices but in most cases companies can set prices for their products. In that case then Magneto should pay close attention to the pricing of their product to ensure they offer value to the customer but also make profits. The price set versus the cost of production would directly impact profit objectives. Pursuit of cost leadership which affects the price will also have a direct impact on the profit targets from the product developed by Magneto.