Market Share: Visafone Goes On The Offensive, Sets Up Price War - 2008-06-02

The Nigerian telecomm market is in no doubt a gold mine. All the existing telecomm companies, according to experts, have not covered 50 per cent of the

market. Ralph Tathagata embarks on a telecomm marketing excursion to know how the brands are faring especially with reference to the new-coming Visafone.

The necessity of communication as one of the fastest means of transaction in virtually all human endeavors, cannot be overemphasized. Right from the hey-day of NITEL, to cite the most recent memorable past, communication has become an aspect of life that Nigerians (mostly in the cities) cannot do without.

But when what appeared as a communication revolution (wireless) began in the 90s albeit something of a luxury in Nigeria, the face of communication began to take a different outlook. During the said period, Intercellular, a leading wireless telecommunications company registered a very visible presence in the country.

Toward the late 90s, at the very outset of President Olusegun Obasanjo's privatization exercise, the introduction of Global System for Mobile communications (GSM) almost coincided with the introduction of Reltel wireless. Interestingly, Reltel marked a new phase of telecommunications in all ramifications in Nigeria. For the first time, recharge cards of various amounts were introduced to consumers though not without the clause of validity period. This marketing strategy upstaged Intercellular at least within the Code Division Multiple Access (CDMA) and placed Reltel at a vantage point. Like some other telecommunications companies, Reltel was not operating within the purchasing power of common people as its tariff could only be said to have favoured the phone vendors who joined in taking advantage of consumers at the time. In the area of Mobile Network, Glo made the most significant and memorable contribution by introducing per second billing to Nigerian consumers thereby challenging the two major existing telecommunications operators, MTN and Econet, now Celtel which were operating on higher tariffs. But as a result of the ingenious marketing flexibility of the said operators, Glo could not actually upstage them though it was still fairly getting its share of the market.

As the marketing competition intensified in the Nigerian telecoms market with a growing demand, more telecommunications companies continue to emerge. Essentially, the most readily available brand promises these telecoms companies aside from the compulsive need to make profit, are always to bring joy to Nigerian consumers by giving them the freedom to talk and communicate on reasonable prices while providing them with veritable passport to reach the world.

Just as marketing strategies and initiatives seem to be the weapon in the world of telecommunications (as it is in every other enterprise), Starcomms, another telecom company with a business savvy, introduced into the Nigerian market something beyond the usual brand promises of reaching the world through the voice or probably text messages, but promises consumers of having internet access even at an affordable rate. It is equally important to note that the short validity period that used to be the bane of retailers from other CDMA operators overtime has consistently been extended to a maximum of 365 days from Starcomms' previous duration of 90 days. That means a subscriber can receive his or her incoming calls for up to 365 days even after the expiration of his or her air time.

Starcomms is Nigeria's first 3G CDMA operator with acclaimed customer-friendly disposition. Its principal target appears to be tailored toward providing better, efficient and effective services including broadband internet service, SMS, conference calls, fun box, kith and kin, VPN among others to its customers. The 3 G enables more capabilities among users than the 2.5 G, in the sense that it enhances free download of much information from the internet. Starcomms also pioneered the simless cell phone in Nigeria thereby easing the burden of conveying the phone box. To portray its business ingenuity and good understanding of the Nigerian market, the brand also pioneered the double sim phone in the country. The reason for this was to enable consumers use their cell phones even when they are outside Starcomms coverage areas.

With the firm belief that its Nigerian customers deserve the best service(s) possible, the brand deploys the Code Division Multiple Access (CDMA) 2000 IXRTT technology, rated as the most sophisticated in the world today, for its operations in Nigeria. Some of its landmark achievements include being the first Private Telephone Operator to cross 100,000 subscriber mark in 2004 and providing voice data and fax services in 2005.

Since its introduction in the telecom market, the brand has always rewarded its loyal customers through different promotional activities. Example of which is the Be On Your Own Promo (BOYO) which has made a couple of its subscribers overnight millionaires. Beyond the BOYO, the brand has always rewarded its customers through different promos. These and many more must have contributed to Starcomms' winning of this year’s edition of City People Award for Excellence as the “Best Private Telephone Operator Company of the year”. Most importantly, the tariff that has been the marketing 'carrots' of many telecom companies was also used by Starcomms in a very dexterous manner. For example, intra calls per second is 17k while calls to other networks cost 41k.   

 But observers and experts are of the opinion that the dual sim cell phone by Starcomms may not survive the already saturated cell phone market in Nigeria, given the fact that they are not as customized as Starcomms' brand.

In spite of  some of these amenable marketing errors, Starcomms has continuously striven to be the nation's largest CDMA 3G Mobile Operator in delivering quality total communication solution through uncompromising customer focus and offering a wide range of innovative products and services. With a CDMA 3G and GSM services, Starcomms has maintained a distant lead in the 3G category along with Multilink until Visafone made itsthreatening inroad into the Nigerian telecom market. Ever since the introduction of Visafone, the brand has engaged Starcomms in a neck to neck battle. While Starcomms' intra call is said to be N10 per minute,Visafone reduces to N8 per minute with N50 free air time at the time of purchase.

Visafone Communications Limited is a Nigerian telecommunications company, incorporated on June 2007 following the acquisition of Cellcom. With the pay off line “your passport to reach the world”, Visafone is also said to have brushed off stiff competition from Multilink, another telecom company known for efficiency in the industry, Gicell Wireless Limited, MTS First Wireless, TC Africa Telecoms Network Limited, among others, to clinch the 800MHz license and rolled out commercially across Nigeria. The brand equally claims to have a stronger market in the South-Eastern Nigeria with the strategic acquisition of Bourdex which has been in existence in that zone. Ironically, Visafone's brand promise, values, choice of colours, TVC, radio jingle among others somewhat ape what other companies even outside telecom had done in the past. Beyond the 3G mobile internet, it also promises to have a subscriber base that will spread over the 36 states and all the major cities in Nigeria as well as to provide dual-sim cell phones. It also dangled some postpaid packages, FAQS, for consumers; VPN for corporates, affordable tariffs, instant connectivity, IDD, USB, lowest International call rates from N12, lowest call rate on-net to GSM, lowest SMS rate, Super fast 3G, among others.

At the moment, the brand claims to have covered about 14 states and 100 cities in the country. But a market research by M2 sharply invalidates this claim. According to Mr. Moemeka, a Visafone subscriber who said that he specifically subscribed to the brand based on its claim of wide coverage just to communicate with his family in Delta State. “I actually subscribed to Visafone based on their promises of having covered my state. I also subscribed for my aged mother who is in Ughelli. But as I speak to you, I have not been able to talk to my mother through Visafone for over one month since I made the purchase. All my efforts to reach the company's customer service have not yielded any positive result”, he said. Another subscriber who gave her name as Omolara said that she has not been able to connect with Ibadan ever since she acquired Visafone line. According to Omolara, the brand's customer service has not been able to give her any desired attention. Equally important to note is the broad band internet services that give access to the internet which Visafone promised its subscribers.

The WAP package according to the brand is specifically meant for those who like to surf the internet via their cell phones. Through WAP, as promised by Visafone, you can check your emails, access the latest news stories, check up on weather forecasts and get updated on sports reports direct from your mobile phones while on the move. With the Visa Silver, Visa Gold and Visa Platinum promises, no techno-genic fellow can resist the offer.

 To confirm the veracity of this promise, M2 visited about three distribution outlets of Visafone and was told that the network was not ready as at press time.

One wonders at this point if Visafone's stipulated mission statement to act as a springboard for Nigeria's economic growth and development through the provision of cutting edge communications infrastructure as well as multi-purpose cell phone and efficient services, that will ensure excellent customer service is not a marketing ruse. Given the short period the brand has been in the market, the visible presence and subscriber base it has covered, nothing at this time should influence such touting. Unless it does not trust what it has in the market? The Nigerian telecom market is still a potential gold mine. The way any investor comes into it determines how long and well that investors stay in the arena. One is compulsively impelled to suggest a thorough re-examination of this ostensibly aggressive marketing by Visafone. Few consumers can be fooled for sometime. But how long will it take you to sustain the hoax?