Cell C 'not a loser'

Johannesburg, 16 Apr 2008

Five years of being seen as the cellular "loser" is going to take a lot of effort for Cell C to turn around, says new CFO Fabrizio Mambrini.

"That brand perception was built up over years, dismantling it is going to require a concerted effort in marketing and education to come right again. Of course, we don't have the deep pockets of our competitors, so we have to be very clever how we go about this," he explains.

However, Mambrini says the brand is already seeing a turnaround, one that has been critical to the company improving its financial performance.

"At one stage, we tried to match our competitors' efforts, but we lost badly. So we decided to take a different strategy. Today, we have five million subscribers; that demonstrates that we are making headway. It's not like three years ago, when people were almost ashamed to be Cell C subscribers," he comments.

Practising Judo

Cell C's Hola 7 and Woza initiatives have been particularly good at getting consumers to engage with the operator, notes Mambrini.

"Hola 7 used Zola as a brand ambassador. This South African personality has leant a lot of strength to our brand. People see him as cool, so by virtue of his choosing us, Cell C must be cool too."

Offering free weekend calls has similarly helped the operator to up its brand perceptions, says Mambrini.

"We had extra capacity on our network which we knew our competitors didn't have. So we offered free weekend Cell C-to-Cell C calls to our subscribers. For our existing customers, this meant giving back to the community; to non-subscribers it offered them an incentive to engage with us and experience the quality of our network. This has been extraordinarily successful."

It is these types of initiatives - which Mambrini likens to the Judo practice of using opponents' weight against them - the cellular operator will focus on in the year going forward.

Fighting 3G

Another perception the company will have to address is the belief that its 2 191-site Edge network is inferior to the 3G and HSDPA technologies offered by its competitors.

Although Cell C has upgraded its core network to be 3G-enabled, CEO Jeffrey Hedberg says it will not follow Vodacom and MTN until it sees the business case.

"Those companies are really pushing those technologies, but we don't see the need for it as yet. Our guys have tested the network and checked the quality of service on common applications like e-mail and surfing. It performs really well and fast too. Are we going to upgrade to 'catch up' with MTN and Vodacom? No we don't think that's necessary," he explains.

Cell C yesterday revealed it had 600 000 data subscribers and declared itself satisfied with its data volumes.

However, Mambrini admits the problem rests more with customer perception of the technology rather than the technology itself.

"In the last two years, we've spent R2 billion on infrastructure upgrades; we've allocated double that for the coming two years. But technology is not our problem, it is market perception. We need to educate the market that our Edge network is just as good as the data networks of our competitors," he concludes.