Nicola Mawson
A new mobile network virtual operator (MVNO) under the name C-CONNECT has been launched with the aim of bringing more competition to the South African mobile market.
C-CONNECT, which is a SIM only offering, is piggybacking on Cell C’s network and is backed by a venture capital and SIM card distributor, Basa. Blue Label Telecoms, which provides digital distribution of mostly prepaid products, is Cell C’s single largest shareholder.
Speaking at the launch event yesterday, C-CONNECT COO, Richard Anderson, said previous MVNOs had approached the market in the wrong manner as they were only competing on price.
“We’ve designed the product as we’ve designed it. We want to be different,” he said.
C-CONNECT offers prepaid deals that reward users with 10% back whenever they buy airtime. Called Cha-Ching, these rewards can be used to pay bills, buy electricity, or book tickets to events, among other virtual vouchers. Anderson noted that the partnership with Cell C and, by extension, Blue Label, was a “natural fit”.
Anderson said the company had been piloting the offer for eight months and aimed to go to the retail market in September.
There are currently 17 MVNOs in South Africa. These include those from brands such as Capitec, FNB, Standard Bank, Pick n Pay, Mr Price, and Shoprite, all of which use their existing customer base to scale.
Anderson noted that C-CONNECT would differentiate itself by driving digital inclusion, being affordable, and tailored to customers.
“It is difficult for us that we don’t have that existing base, so we do need to continue to be clever about our marketing strategies,” said Anderson.
“Our brand is funky and vibrant to connect with customers.”
Speaking at the C-CONNECT launch, Africa Analysis director, Andre Wills, said the research company was seeing more customisation in terms of MVNO offerings.
“There is no one definition of what an MVNO is, it all depends on how you go to market,” he said.
South Africa’s MVNO market, which was introduced in 2014, has declined from 33 in recent years to 17 now, said Wills.
“A key differentiator in South Africa has become surviving. You can attract customers, but you need to retain them as well,” he added.
The size of the market is expected to grow from 4.5 million SIM cards now to double that by 2027, said Wills. To place this in perspective, there are 118 million mobile connections overall according to research from World Wide Worx.
Wills added that customer relationships were key to the success of a virtual operator.
“When you look at the successes and failures of MVNOs, CRM has come to the fore more and more,” he said. “You can’t be another ‘me too’ proposition, else you will flatline.”
World Wide Worx managing director, Arthur Goldstuck, concurring with Wills, said “you have to build a brand in order to build loyalty and you have to build loyalty to build a brand. The two go hand-in-hand.”
Goldstuck added that consumers need a simple package, flexibility, and a sense of connected community, which builds loyalty and brand awareness.
“The one flaw in most MVNOs in this country is that they didn’t create brand awareness or generate loyalty, so people didn’t tell their friends about it,” he said.
Goldstuck added that he didn’t believe that MVNOs in general marketed themselves especially well.
BUSINESS REPORT