Safaricom hit as a third of small business clients flee
Members of the public queue outside a Safaricom shop along Kimathi Street in Nairobi on April 7, 2022 to register their mobile phone SIM cards.
Telecoms firm, Safaricom, has been rattled by the exodus of its small business customers, lamenting expensive services and lack of transparency in pricing.
The company noted the exodus in the year to March 2022 was the first it had witnessed in four years, prompting reviews in pricing and transparency in billing.
Data show that about 100,000 small and medium enterprises (SMEs) and small-office-home-office (Soho) fled the Safaricom stable. SMEs have between 10-50 employees while Sohos have less than 10 workers.
The biggest exit was among Sohos with some 89,000 of them quitting—an equivalent of 30 per cent of their total count. Some 11,000 SMEs fled the Safaricom fold, an equivalent of 10 per cent of the SMEs pack.
The telco blames the exits on opaque billing and high cost of service, which it has since reviewed.
Safaricom noted that up to 26 per cent of businesses were leaving it on a monthly basis for disagreeing with bills and that it had to intervene with a programme, cutting the flight rate by half.
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“We realised that many newly onboarded customers were churning after the first month because they did not understand the bill and did not clearly understand the escalation matrix. Accordingly, we introduced a FTTB (Fibre to the Business) ‘kindergarten’ programme which included SMS communication and calls to customers from our telesales teams,” it said.
Among the issues were “concerns around value for money in how Safaricom’s products and propositions are structured and accurate and easy-to-understand bills delivered on time.”
This is the first time the company has recorded a fall in the number of its enterprise customers based on its records, going back to 2018, and it coincides with a time when its customers have expressed concerns on value for money on its mobile data and voice services.
“Value for money is another key customer issue. Accordingly, we rationalised prices across key products to ensure that they meet customers’ needs. We have also crafted solutions that address specific segments instead of a one-size-fits-all.”
It added: “For example, we developed voice and data products that address the communication needs of Soho and some SME customers. We achieved this by providing a solution that allows small business owner to buy and manage affordable voice and data bundles on behalf of their staff.”
The telco also “addressed connectivity needs by introducing a 3Mbps fixed data proposition for SOHO customers” at a time competition is growing.
