Practical Marketing Communication - Essay Example

? Practical Marketing Communication Table of Contents Executive summary 3 Introduction 4 Product history 4 Target market 5 Competitors 5 Celebrity endorsement 6 Advertisement 7 Point of sale promotion 8 Sales promotion 8 Packaging 9 Sponsorship 10 Social media 11 Conclusion 12 Recommendations 12 References 13 Executive summary The aim of this report is to critique the communication mix that Safaricom Kenya limited has used in marketing its M-PESA mobile money service. This report examines the various communication techniques that Safaricom Kenya limited has used to convince its users to enrol for the M-PESA money transfer service, this report, however does not focus on other products of Safaricom, as they are too many to be handled in one report. The target market for the M-PESA mobile money service ranges from business owners who can be paid their bills using the service to the Safaricom network users who spend a lot of time and money to send money to their friends and families or to pay their bills, and in Kenya, some of the closest rivals of the service are Airtel money, Yu cash and Orange money. Safaricom Kenya limited uses successful business and media personalities to endorse their product such as Jaguar and Size 8 who are some of the most celebrated media personalities in the country. The use of Jaguar, a celebrated musician in the country whose story of rags to riches identifies with most of Safaricom mobile services subscribers was well informed as the musician is seen by many young people as their role model in their quest to pull themselves out of poverty. The “Niko na Safaricom” advert that was performed by the Safaricom choir was hailed as one of the best musical adverts ever shot in the country and it became a household song soon after its release. Point of sale promotion also encouraged many people to register for the service as the registration was free and SIM cards were sold at subsidised rates. The introduction rates for the service, although they were perceived to be fair, they were relatively expensive to most of the M-PESA service users The company also uses the social media to encourage its subscribers and the subscribers of their rival companies to subscribe to the service by asking quizzes about the benefits and the products within the M-PESA service on its facebook fan page. Introduction The purpose of this report is to analyse the various communication elements that Safaricom Kenya limited has included in its communication mix to sell its M-PESA mobile money service to its subscribers. This report has highlighted the main communication techniques that the company has adopted that ranges from celebrity endorsements by popular media and business personalities in the country to advertisements. Point of sale promotions, the way the product is packaged within other services offered by the company, its advertisement strategies and how it has used the social media and especially facebook to market the M-PESA mobile money service (Kloeppinger-Todd & Sharma, 2010, p239). The report will compare the brand with other similar services that are offered by its rival companies; however, due to the large number of services that the company offers, the report will not look at the communication mix that the company has used to market its other products and services (Pike, 2008, p56). Product history Safaricom M-PESA service has been in existence in Kenya since the year 2007 when it was launched, it was launched as a mobile money transfer service that would enable its users to transfer money to other subscribers of the network. However, it was advanced to incorporate sending of money to other mobile subscriber networks such as Celtel, which is currently Bharti Airtel Kenya and Telkom Kenya. The M-PESA mobile money service entails services such as depositing and withdrawing of money, transferring of money to other users and non-users, purchasing of airtime, pay bills and transferring of money between the service and a bank account of the user in some specified banks. Target market The target market of the service includes a large part of the Kenyan population that although being economically active does not have bank accounts. The dynamics of the Kenyan economy is such that most of the working population who mainly come from the rural areas work in the urban regions of the country, which are far away from their homes. This has necessitated the need for an efficient way to send money back home to their families in a cheaper and easier way and since there are no banks in these regions M-PESA would bridge that gap (Leadbeater & Powell, 2010, p 203). In addition, the paybill service that allows M-PESA users to pay their bills from the comfort of their homes was targeting the working population. This is because they were always busy and could not find time to go and wait in long queues in formal banking institutions or a service provider such as the Kenya power and lightning company that provides the electricity service to Kenyans in order to pay their bills (World Bank, 2011, p65). This service was also targeted at business people who with the rising insecurity in the country were losing a lot of money through robberies and transfer of money through the M-PESA paybill service would prove convenient and safe for these business people Competitors The main competitors of Safaricom M-PESA service is Airtel money from Bharti Airtel Company, YU cash from Essar Telkom and orange money from Telkom Kenya. Currently, Airtel money is the greatest rival to the M-PESA service with almost similar products, the emphasis of the product is different from the one in the M-PESA in the sense that the service is mainly designed for the urban-class working people since the Airtel network service is available in towns The Essar Telkom YU cash services communication mix is targeted to the low earning citizens as the company targets to endear itself to the citizens through it low cost service. For instance sending money through its YU cash money transfer service is now free to all its users and across all networks in the country. Orange money from Telkom Kenya is targeted to the working class population especially those in formal employment, this service markets itself to its target group as the fast and reliable way of sending and receiving money among the working population to all the major urban centres in the country. There are other small money transfer services such as Mobi pay, Angaza money transfer service that are not attached to any network service provider, however, these companies do not hold a significant portion of the mobile money market. Celebrity endorsement The Safaricom limited company has marketed its M-PESA mobile money transfer service through the celebrity endorsement of jaguar and size 8, jaguar, who is a popular musician, businessperson and a philanthropist in Kenya has been on the screens advertising for other respected brands and products. In addition he has also been involved in shooting of various peace message campaigns with international and other community based organisations, therefore using the celebrated musician to endorse the product in a country where there are few regulations on mobile money transfer service has gone to increase trust of businessmen to use the service in their daily business transactions. Size 8, who is a celebrated musician and a student in one of the local tertiary institution of learning, has been used to endorse the M-PESA service in order to appeal to the young generation who compose of a large number of the population in the country. Apart from using celebrity endorsements to boost the service, Safaricom Kenya limited has used the endorsements of the local average citizens in the country from different professions and the informal industry where they give testimonies of how the mobile money service has made money transfer easy for them or helped them run their businesses. The endorsement by the average citizens caused a great stir among its subscribers as they saw it as a way of the company to reach the common people who had never before been approached to endorse any product. Advertisement Safaricom has used several advertisements concurrently to promote its M-PESA service, the first one is the ‘Naweza’ which means ‘I am able’ in English, a choir performs the song encouraging the subscriber to believe in the in potential and use Safaricom products to achieve their dreams. This advert uses the emotional appeal to connect with the customers since most of the Safaricom customers who are middle class who have dreams of becoming wealthy sometime in future, the adverts tends to make the customers believe that one for them to achieve their dreams they have to use Safaricom services. The other advert that Safaricom has used is the M-PESA relax, which is aimed at encouraging M-PESA users to use the service for all their money transfers, paying bills and purchasing airtime. The advert shows the convenience that M-PESA has brought into peoples’ lives, in today’s world, which places a premium on time, and convenience, the advert tries to show how M-PESA fills that gap. This advert uses information and facts to appeal to the customers where it shows them the convenience that use of M-PESA service brings to their lives. This advert uses the AIDA model since the advantages that are brought about by M-PESA attract the attention of the customers. They way the advert has made creates the interest in the customers, acting on the advert happens where the customers activate their M-PESA option on their simcards or purchase Safaricom simcards and register for the simcard service (Parente, 2006, p66; and Percy, 2008, p96). Point of sale promotion in order for the service to reach the all the customers of the network service provider, Safaricom encouraged businessmen in all the towns, shopping centres and markets in the country to enrol for agency services where they would facilitate the transaction of M-PESA services in exchange for a small commission. The M-PESA agents would enrol Safaricom’s subscribers to the service and train them on how the service is used without charging any fee, new simcards that would be issued to new Safaricom customers would also be registered immediately before the customers starts using them, this emphasised the M-PESA motto of convenience and time saving. Sales promotion Sales promotion is one of the areas that the company has been most vibrant in to increase the use of the service by existing customers and registration by new customers. To motivate the existing customers to use the service more frequently and to carry huge transactions, Safaricom Kenya limited has introduced the Bonga points reward scheme that was previously only applicable for airtime services only. Under this scheme, M-PESA users are to earn ‘Bonga point’ on their M-PESA transactions depending on the amount of money that is deposited or transferred to another line, these Bonga points can then be redeemed later for airtime or various electronic devices such as mobile phones, tablets and laptops depending on the number of ‘Bonga points a user has accumulated. Another promotion service that Safaricom Kenya has used to attract its customers to increase their M-PESA transactions is the ‘ponyoka na pickup’ promotion. This promotion allowed M-PESA users to accumulate points, which would be then put in a draw, and a lucky user would be picked to win assorted prizes with the ultimate price being a pickup truck to be won at the end of the promotion. To attract users of services from other networks, Safaricom capitalised on the fact that it holds the largest share of the mobile market in Kenya, therefore transfer of money to users of the service were charged ksh 25 (US $ 0.3) in contrast sending money to non registered users which was charged ksh 75 ( US $ 0.9). The low costs that were charged to transfer money to the users encouraged more people to register for the service (Ledgerwood, Earne & Nelson, 2013, p63). Safaricom used another cunning way to promote its sales where it offered prizes to its agent countrywide depending on their sales. The agents depending on their sales would earn points, which would then be put in to a lucky draw where the winners would take home cash prizes ranging from ksh 5000 to ksh 25000 and the ultimate winner would take home a brand new Mercedes E200 valued at Kshs 7.7million. The importance of this promotion was to encourage the agents to market M-PESA in their areas of operation and therefore increase the volumes of transactions in the service. Packaging The M-PESA service comes packaged within the Safaricom SIM card; therefore, any user of Safaricom service has the capability of accessing the service provided he is registered. The M-PESA package comes with very many services that go to emphasize on the convenience and time saving aspect of the service (Omwansa, & Sullivan, 2012, p128) The send money option in the M-PESA menu allows users to send money to other users of the service in addition to Safaricom network subscribers who have not subscribed and users of other networks in the country (Chuhan-Pole & Angwafo, 2011, 89). Receive money option allows the users of the service to receive money from the other users and from a similar service provided by other users (Morawczynski, Smith, & Bray, 2011, 97). In addition, the buy airtime option allows the M-PESA users to top up their mobile phones using money that they have deposited in their M-PESA accounts, this service also allows the user of the service to top up another number within the same network (Gewald, Leliveld & Pes?A, 2012, p153). The inclusion of M-SHWARI service, which is a mobile money banking service within the M-PESA service, has led to attracting of many customers. This is because the service is like a typical bank where individuals can borrow money depending on their use of other Safaricom network services such as data and calls, in addition people can also save money and earn interest rates on their savings. The M-PESA package also comes with the payment services that include an option for paying a person bills such as electricity bill, water bills, in addition, individuals can also pay for other services including repaying their loans using the payment service (Jerome, 2011, p198). Still in the service, a buy good option helps the individual to purchase goods at the comfort of their homes and pay for them using money that they have deposited in their M-PESA account (Banerjee & Duflo, 2011, p235). Another key feature of the M-PESA package is the personal account where an individual gets the chance to customise his M-PESA accounts including the services that he wants to subscribe to. Sponsorship The relationship between Safaricom Kenya limited and its subscribers is strengthened by the several sponsorship programs that it has undertaken. The Safaricom Lewa marathon is one of the events that the company sponsors which is aimed at helping in the conservation of wildlife in various national parks and national reserves in Kenya (Mohapatra & Ratha, 2011, p145). This event brings together athletes and fans of athletics; this event maybe creates the perception that the company is interested in empowering the local athletes to discover their potential in participating in marathons and at the same time helping in conservation of wildlife, which is a major currency earner for the country through tourism. Safaricom rugby sevens is another event that the company sponsors, this event, which involves several rugby teams from the country and other neighbouring countries usually happens once in a year and takes several days. The company getting involved in this event, which is mainly at attended by the youths and middle class, has been seen as an effort by the company to reach out to the young generation and help them develop their talents. In addition, the company also sponsors musical concerts in its ‘Michael Joseph’ centre by groups from all the regions of the country portraying an image of concern to society. This has made the society embrace it services, as they perceive the money that they use on the company’s service and products eventually comes back to them through the various services and products that the company offers. Social media The company launched a social media campaign to create awareness of its M-PESA services mainly in its facebook, it launched question and answer sessions in its official facebook fan page where those who would answer the question correctly would be awarded cash prizes through their M-PESA accounts (International Marketing Theory Conference, Jain & Griffith, 2011, p 284). In addition to answering the questions correctly, those participating in the promotion were required to share the update on their profiles and invite their friends to like the page. This way the information about M-PESA would reach many people conveniently when going through their facebook page, the cash prizes would also motivate people to know more about the M-PESA service and this would require them to use the service more frequently if they had not registered. Paying of the prizes through the M-PESA service also encouraged those who wished to participate in the promotion but they had not activated their M-PESA accounts to do so in order to receive their prizes in case they won. Conclusion The results of this report found out that the marketing communication mix that Safaricom used were geared to show that their M-PESA product was the best in regard to convenience and time saving to its customers. Their product endorsements by influential personalities in the country that people could identify with and the common users of the service were perhaps the most effective marketing communication style that they used. It got more people viewing the company as more customer centred as the endorsement made people understand the real convenience and time saving that using the product brought. Points of sale promotion which was conducted by the M-PESA agents was however not very successful as some of the rogue agents used that chance to charge the unsuspecting customers of the service exorbitant prices for the registration which is supposed to be free The use of social media has been a leading option for its communication marketing since it is cheaper and therefore conducted regularly to boost the use of the M-PESA services, in addition, the service is used by young people who are either in college or entering the job market therefore they start using the service immediately. Recommendations Although the product is widely used in the country enjoying over 90 per cent market share, Safaricom should come up with a way to show the saving aspects of the service since its rival’s services charge cheaper rates and some of the M-PESA customers have started getting uncomfortable with this discrepancy Point of sale promotions especially where money is involved should be directly done by Safaricom or use other methods to compliment is in order to avoid rogue M-PESA agents from exploiting the service users. References Banerjee, A., & Duflo, E. (2011). Poor Economics a Radical Rethinking of the Way to Fight Global Poverty. New York, PublicAffairs. http://public.eblib.com/EBLPublic/PublicView.do?ptiID=688714 Chuhan-Pole, P., & Angwafo, M. (2011). Yes Africa can: success stories from a dynamic continent. Washington, D.C., World Bank. Gewald, J.-B., Leliveld, A., & Pes?A, I. (2012). 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