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Vodacom shouldn’t be proud that it’s more expensive

It’s sit-and-wait mentality may come back to bite.

In reference to the article “Why we are more expensive – Vodacom”, it is sad that the mentality of a corporate giant like Vodacom is such that it can say (in the words of Phil Patel, Chief Consumer Officer at Vodacom): “despite the lower prices from Cell C and 8ta, they are not losing market share to these two companies.”

The sad fact is that its mentality is rather a case of waiting for customers to leave before adjusting its pricing to be market-related, as opposed to being proactive and telling existing and possible new customers that its rates are in line with the market and competitors (which is public knowledge to anyone and everyone).

Patel should also not be ignorant to think that the network is superior in every corner of this country. Like all other networks, Vodacom has good reception and bad reception. A friend of mine has critical (or no) reception with Vodacom at his residence in East Rand, whereas his new CellC number has very good reception. So for Patel to think that Vodacom has better infrastructure – which he thinks means better reception everywhere – is not the mentality and leadership a market leader needs.

Considering CellC’s marketing campaign for the last two years, and its “balls” to lead the market by slashing its rates drastically, this will only uplift its image, status and leadership in the mobile communications industry in South Africa. I think a lot of its recent strategy is thanks to an ex-Vodacom CEO, Allan Knott-Craig, who is now the CEO of CellC. His insight to the competitors’ ways and habits will allow him and CellC to navigate through the competition by giving it the market advantage of slashed rates and competitive pricing (whilst competitors like Vodacom and MTN (JSE:MTN) will deliberate and wait for something to happen before taking any action).

It must also not be forgotten that CellC recently acquired its license to stock, promote and sell the infamous iPhone. (This was after Vodacom and MTN’s exclusivity ended after two years). CellC is on a winning streak, with world class mobile phone offerings, competitive pricing and vigorous marketing and advertising.

At the end of the day, all providers provide the same service: mobile calling, text messaging, and data services. This is what every consumer looks for, because all networks are prone to good and bad reception and up times and down times.

Unfortunately for Vodacom (and MTN), consumers are alarmingly aware where value-for-money resides. Human reaction would be to move at the soonest possible convenience and time for themselves (the customer). With MNP (Mobile Network Portability), it is as simple as requesting a transfer from the likes of the new and future leaders like CellC and 8ta that will give customers the flexibility and no inconvenience of moving to a cheaper provider.

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