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Airtel could drop low-cost strategy
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mukiha
#1 Posted : Wednesday, February 29, 2012 11:43:42 AM
Rank: Elder

Joined: 6/27/2008
Posts: 4,114
LINK: http://www.nation.co.ke/...0/-/me9mk4/-/index.html

I liked this comment: “Unlike India, we were surprised that in Africa, lower tariffs could not increase volumes. In Africa, subscribers use the money saved on lower-calling rates to buy food and not to talk more. This means that we have to think of a new model that works there,” the firm’s chairman and MD, Mr Sunil Mittal, said.
Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
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Abunuasi
#2 Posted : Wednesday, February 29, 2012 12:12:24 PM
Rank: New-farer

Joined: 8/25/2010
Posts: 97
Location: Kenya
The writing has been on the wall. Swallow the humble pie and increase call rates coz cant see any other escape route for Airtel. Engaging in day light robbery thru non functional data bundles and other uncouth behaviors will add more damage to the company.
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mukiha
#3 Posted : Wednesday, February 29, 2012 12:23:10 PM
Rank: Elder

Joined: 6/27/2008
Posts: 4,114
Reminds me of the experience I went through one time. I used to charge sh9k for one of my products and would get about 5 orders per month. I thought the price was too high so I dropped it sh6k but still got about 5 orders per month.

Then I dropped further to sh3,500 but the volume remained! So I started increasing all the way back to 9k....then to 12k then to 15k.... and within one year I went to 25k. Guess what, I still get about 5 orders per month.

Moral of the story: cheap does not always sell more! I am now considering hiking the price to sh50k by the end of 2012...
Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
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josiah33
#4 Posted : Wednesday, February 29, 2012 10:55:01 PM
Rank: Elder

Joined: 1/27/2011
Posts: 1,777
So what are this Indians going to do now that their little trick of low cost calls only served to put ugali on the table rather than making people make more calls?
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vinii
#5 Posted : Thursday, March 01, 2012 8:16:20 AM
Rank: Elder

Joined: 10/14/2009
Posts: 2,057
mukiha wrote:
Reminds me of the experience I went through one time. I used to charge sh9k for one of my products and would get about 5 orders per month. I thought the price was too high so I dropped it sh6k but still got about 5 orders per month.

Then I dropped further to sh3,500 but the volume remained! So I started increasing all the way back to 9k....then to 12k then to 15k.... and within one year I went to 25k. Guess what, I still get about 5 orders per month.

Moral of the story: cheap does not always sell more! I am now considering hiking the price to sh50k by the end of 2012...

those are abnormal profits you are making if you can play with pricing like that - are you a monopoly or what? what exactly are you selling, i may end up being the 6th customer..
If you are an eagle don't hang around with chickens; chickens don't fly....
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mukiha
#6 Posted : Thursday, March 01, 2012 10:13:05 AM
Rank: Elder

Joined: 6/27/2008
Posts: 4,114
vinii wrote:
mukiha wrote:
Reminds me of the experience I went through one time. I used to charge sh9k for one of my products and would get about 5 orders per month. I thought the price was too high so I dropped it sh6k but still got about 5 orders per month.

Then I dropped further to sh3,500 but the volume remained! So I started increasing all the way back to 9k....then to 12k then to 15k.... and within one year I went to 25k. Guess what, I still get about 5 orders per month.

Moral of the story: cheap does not always sell more! I am now considering hiking the price to sh50k by the end of 2012...

those are abnormal profits you are making if you can play with pricing like that - are you a monopoly or what? what exactly are you selling, i may end up being the 6th customer..


There is nothing "abnormal" about profit as long as the buyer is not coerced into buying.

Those who don't want what I sell don't buy it - even if I offer it to them free of charge! Those who want it are willing to buy at whatever price... so far we've reached 25k

Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
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Jamani
#7 Posted : Saturday, March 03, 2012 12:15:21 PM
Rank: Elder

Joined: 9/12/2006
Posts: 1,554
I kept saying this strategy wont work in Kenya.... Airtel have looked at the numbers and they are feeling the pain hurting in the wrong place... they will look at the numbers released by Bob C... compare with theirs and someone will get fired, as has been the case since celtel..
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QW25091985
#8 Posted : Saturday, March 03, 2012 1:02:31 PM
Rank: User

Joined: 1/24/2012
Posts: 1,675
Location: In Da Hood
Bora wasiguse data charges. Hiyo italeta vita. Laughing out loudly
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Jamani
#9 Posted : Saturday, March 03, 2012 5:33:43 PM
Rank: Elder

Joined: 9/12/2006
Posts: 1,554
@Qw, wakigusa data italeta quality na speeds noma vi-deadly
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Impunity
#10 Posted : Saturday, March 03, 2012 6:50:48 PM
Rank: Elder

Joined: 3/2/2009
Posts: 26,331
Location: Masada
mukiha wrote:
LINK: http://www.nation.co.ke/...0/-/me9mk4/-/index.html

I liked this comment: “Unlike India, we were surprised that in Africa, lower tariffs could not increase volumes. In Africa, subscribers use the money saved on lower-calling rates to buy food and not to talk more. This means that we have to think of a new model that works there,” the firm’s chairman and MD, Mr Sunil Mittal, said.


This can only be hate speach or racism!
Though funny.
Laughing out loudly
Portfolio: Sold
You know you've made it when you get a parking space for your yatcht.
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