The Safaricom Playbook: Lessons for the Insurance Industry
by Nuru Shaba
Once upon a time in Kenya, there were two giants in the telecommunication industry: Safaricom and Kencell. Safaricom, the underdog, turned the tables on Kencell, not just winning the market but expanding it. How did they do it? By innovatively crafting products that were so well-designed, they practically sold themselves, a lesson the insurance industry desperately needs to learn.
Let us break down Safaricom's secret sauce—and no, it is not just about offering cheaper airtime.
First, Safaricom sold seconds, while Kencell sold minutes. Sounds trivial, right? However, most conversations were under 30 seconds. Imagine being charged for a whole minute to say, "Hey, I will call you back!" Customers flocked to Safaricom because they felt they were getting more value for less.
Second, Safaricom made sure their agents were well compensated, more than twice what Kencell offered. If you are an agent trying to make a living, which SIM card will you push? The one that feeds your family, of course.
Moreover, do not forget the classic 'scratch card' conundrum. Safaricom's minimum reload was pocket-friendly, while Kencell's was... let us just say they did not design it with the average Wanjiku in mind.
So, what can the insurance industry learn from this?
Perceived Value Matters: You are out of touch if you sell minutes when people want seconds. In insurance terms, you are missing the mark if you offer rigid products when customers crave flexibility. The key lesson here is to deeply understand what your customers value and give them that—at a price that feels like a steal.
Evolve Based on Real-World Data: Customers always find creative ways to use products. Flash-calling, anyone? (It's a Kenyan invention!) If your data shows customers doing something unexpected, do not fight it—pivot! The message here is clear: adapt your products to align with their behaviors and needs, and you will stay ahead of the game.
Positioning is Key: Safaricom targeted the masses, while Kencell targeted the affluent. Who is laughing all the way to the bank now? It is tempting to chase the big corporate contracts in insurance, but the real goldmine is figuring out what the average person needs and delivering it with flair.
The insurance industry has a choice: continue serving the low-hanging corporate fruit or take a page from Safaricom's playbook and craft products that win over the masses and expand the market. The next big success story could be yours—if you are willing to think small to win big.
Furthermore, remember, sometimes all it takes to win is selling seconds instead of minutes.