Safaricom: Leading Communication Company in Kenya

The Safaricom needs no introduction since it has established itself as a household name in Kenya and the entire region. The revenue turnover for the company is over 100 billion Kenya shilling making it more valuable those most financial institutions in the country. The company was a department in the Kenya Post & Telecommunications Corporation. Their operations were rolled out in 1996. In 1997, Safaricom was registered a private limited company as per the guidelines of the Companies Act. 

Safaricom became a public company in the year 2002. At this time the Kenyan Government held 60% of the company's shares. The government lost its controlling share majority in 2008 after it sold its shares to Kenyans. The Initial Public Offer held to sell the shares saw the company's shares sold at 5 Kenya shillings per share. However, the value of the shares dropped weeks after being listed in the Nairobi Securities Exchange.

Safaricom Leadership

Michael Joseph joined Safaricom in 2000 and became the first CEO of the company. At his entry to the company, the subscriber base was below 20,000 and has grown to over 18 million. Michael was hardworking, visionary and results oriented. He guided his staff towards exploring their full potential and this is what elevated the company status.

Robert (Bob) Collymore, is the second and the current CEO of Safaricom. He joined the company in 2010 and has made major changes in the company. He restructured the company's management and developed new services such as M-KESHO and M-SHWARI. His management style is quite different from that of Michael Joseph but he too has enhanced the image and the financial base of the company.

Services

Safaricom Limited is Kenya's largest communications network provider in Kenya. It has a commanding market share of over 60% with over 18 million subscribers. I will highlight some of the services the Safaricom offers its subscribers.

Voice services which include both pre paid as well as post paid services. Voices services contribute the majority of the company's revenues. It contributes over 60% of the company's revenues which is approximately 68 billion Kenya shillings.

M-PESA service that was introduced in 2007 is the second largest revenue contributor for the company. M-PESA is a money transfer service that can be used to pay bills, withdraw or deposit cash to your bank account, buy airtime and send money to various parts of the world. 78% of Safaricom subscribers have an M-PESA account. M-PESA contributes over 15% of the company's revenue which roughly is over 15 billion Kenya shillings.

Safaricom provides internet users with the fastest data network the 3G internet. Safaricom data services are reliable and relatively cheap and come in different packages depending with the internet usage of different consumers.

Messaging services via SMS and MMS are the main messaging options provided by Safaricom. They make a revenue contribution of 7% which is revenue of up to 7 billion Kenya shillings.

Safaricom Business is a service meant for business persons. It is mainly a data service that provides conferencing services for entrepreneurs.  The service offers individuals with a cheap data option to conduct their business.

Mobile phones, laptops and phone accessories are also provided by Safaricom. The company sells a wide range of superior quality phones and laptops at varying prices. Modems that are used to provide data to computers are also sold. They also service phones and laptops at their authorized dealers at Safaricom shops located in various parts of the country.

Marketing Plan

To create awareness for the services provided by Safaricom, the company's has organized a comprehensive marketing strategy to edge out its competitors. It has employed media campaigns both print and audio visual, online marketing and social media marketing. The company has invested in marketing to reach out to potential customers and retail existing customers. The adverts used are eye catching, easy to remember and provide relevant information regarding the service being advertised.

Competitors

Fair competition in the market is health for development of new innovations and provision of quality services. Although Safaricom has a controlling market share of the telecommunication industry, it faces competition from other service providers. Airtel is the greatest competition for Safaricom especially because the company lowered its call rates and message rates to attract new subscribers. Whereas M-PESA transactions are charged for Safaricom, Airtel Money transactions are free. Other competitors such as YU and Orange are struggling to increase their subscriber base but are a major challenge to Safaricom since they offer the lowest calling rates. For example YU to YU calls are free. Orange’s offers very attractive unlimited data packages

Safaricom's SWOT Analysis

Safaricom has a number of strengths that work to its advantage. M-PESA is Safaricom's greatest strength since it is the most trusted money transfer service in the country. The fact that M-PESA services are easy accessible from all parts of the country is one reason why the service has a great number of users. Safaricom network coverage is highly reliable even in remote areas and this is another of its strong points.

The major weaknesses of Safaricom include the fact that they have the most expensive calling rates as compared to other regional networks such as Airtel, Orange and YU. Safaricom's data is relatively expensive compared to Orange which offers cheap unlimited data.

The opportunities that Safaricom can exploit to enhance it's service provision include capitalizing on the weaknesses of it's competitors. Other service providers do not have network coverage in all parts of the country and Safaricom could use this to it's advantage. It could ensure that it establishes its services to these regions before other service providers get a chance to do so. 

Safaricom main threat is the strengthening of other network providers. Airtel is fast gaining popularity among the masses due to its attractive and pocket friendly services. The cheap calling rates, messaging rates and free money transfer services offered by the company are a great threat to the dominance of Safaricom.

Customer Service

Safaricom has offers one of the best customer care services in Kenya. The company has a 24 hour running customer care service. Customer care providers assist customers with the various issues they experience within the network. The company has outsourced its customer care service and this is part of the reason why the service is of high quality. One can call a toll free number for assistance or seek assistance on social media such as twitter.

Corporate Social Responsibility

Safaricom has been actively involved in various projects that are aimed at improving the lives of Kenyans. Bob Collymore led a group of corporate disaster relief when parts of Kenya were hunger stricken. This campaign dubbed Kenyans for Kenya raised over 100 million to feed hungry Kenyans. The company has financed various water projects, building of schools, health facilities, conservation of the environment and economic empowerment. All these projects are managed under Safaricom Foundation.