Fantastic topic, is it @muganda thread starter?
I think to better understand this you need to look at once-upon-a time dominant companies and see how they were overome such as
1. Elliots bread
2. Unilever(East African Industries)Treetop/Kimbo/Lux soap/Rexona
3. Kilimanjaro water
4. Isuzu (especially matatu)
5. Barclays bank
6. Kencell
7. Brookside

Juxtapose this against
1. Super loaf/Festive bread
2. Bidco
3. Keringet
4. Second hand matatus
5. Equity
6. Safaricom
7. limuru fresh/Fresha
Other than corrupt management, if you study the above you will find a lot of it has to to with pricing and "snobbery" when one finds themselves dominant. When the dominant player adopts "snobbish" ideas,(making customers queue for product, failing to deliver on demand, excessive advertising, ignoring complaints, keeping product always higher priced than competition assuming your product is superior, taking customer for a fool with per minute billing etc) the player wanting to cut into the market needs to take advantage of the "snobbed market". I think EABL is about to find itself in the former, they have become arrogant and snobbish. If keroche works with bar owners it will cut down this giant.

>> To unseat a dominant rival its important to segment the market then develop a market mix for each segment. The segment however should be large enough to generate sales that ensure good returns...e.g EB and safaricom started by offering cheaper services than their competitors and achieved a huge market share...it would be more fruitful to for Orange, Yu or Zain to specialize on either data, calls, sms, or mpesa than the price wars. e.g. for Yu to unseat safaricom they may need to segment the market geographicaly and offer 'bei ya slum', 'bei ya campus', 'bei ya coast', 'bei ya nairobi' etc. The idea is to get loyal customers instead of the squatters they have now, ...

I find it interesting that so many people found SCOM cheaper than Kencell, while the truth was that SCOM was charging sh30 per min billed at 50cts per sec and Kencell was sh15 per min [billed per min]

Indeed at one time, a Kencell->SCOM call [sh25] was cheaper than a SCOM->SCOM call [sh30]!!!

SCOM's win in the battled field had little to do with the airtime price...after all they were more expensive!!!!

SCOM won mainly due to the way they managed their distribution...gave retailers a much higher margin [sh1,600 per line sold] than Kencell [sh300].

the retailers really pushed SCOM lines even at the time when the network was collapsing every day!!!

@mukiha - I would say that 'idiot' was smarter than all of us combined...

@Much Know... that list of people who were once dominant gets me thinking... Even when you're on top, watch out! The fall could be just around the corner.

Guys very good insights, and no arguments about the idiot.

@mukiha, Okoa Jahazi is very cheap if it saves you when your stuck; same with an Equity Loan if they are the only bank that values you enough to give one to you. My take was Safaricom was cheapest at the time, because I could choose to speak for 30 secs.

I actually had both lines at the time and credit always ran out of the Kencell line faster. Even Kencell's eventual switch to per second billing must mean something.

But we also need to move beyond money and look at the brand. At a certain level, human beings are aspirational - Safaricom, the peoples option Kencell, pink is the colour of clarity
Come to think of it, the idiot's company is very aspirational. There's even a song about the coffee... That's why the most handsome/beautiful person in the world is often your child.


@mwenza, have you seen the queues in Equity? But the customers do not want to go anywhere else

>> If mukiha statement on scom and kencell prices is true, them scom won the market through psychological tactics . scom divided the market into social classes, and made people to believe that kencell was meant for guys from upmarket leafy neighborhoods and scom for the middle class and low class. Having a kencell line was like for prestige, for high class guys, and scom for mwananchi....Yu and Orange are coming in through the same strategy, and safaricom is now perceived as the expensive network, a re alignment is in order.

By the way, whats the status of the whole number portability thing? There was some noise about this then it went quite. Ama kuna mtu alilipwa? Coz to me this is the game changer.

I have heard people say that this number portability thingie is what will sink Safaricom. I disagree. People are very conservative when it comes to changing items - like phone numbers and bank accounts - that have an emotional value to them. (For instance, research done in the US recently showed that an American is more likely to get divorced than to change his/her bank account). Number portability has not caused a significant increase in churn in areas where it has been introduced. Plus Safaricom has been working pretty hard to ensure customers stay loyal - one reason they introduced M-PESA and now they are revamping their customer service.