Introduction
For a business organization to achieve its goals, there must be a plan. A marketing strategy is designed to facilitate the sale of products and/or services. MTN Ghana’s approach to promotion has various components, and all of them are aimed at building trust between the company and consumers. Results are reviewed frequently, and improvements are made in line with the threats and weaknesses identified. MTN Ghana has been successful in implementing the marketing mix, product differentiation, coping with commoditization, and realizing the competitive advantage (Gooderham, Grøgaard and Foss, 2019, pp. 46-48). Market segmentation has facilitated the discernment of the consumers’ expectations, and hence the determination of how they can be met effectively.
Company’s Background Information
MTN Ghana is the biggest telecommunication firm in the Republic of Ghana. It was launched in 1994, and currently controls 57% of the market. Vodafone and AirtelTigo, the two most significant rivals, have 21.97% and 20.3% of the total mobile phone subscribers respectively (Paul, 2020). MTN has a 70% share of the data subsector, and this is even though there are over 50 Internet service providers (Reuters Staff, 2020). The company also dominates the trade in mobile money, a situation that has prompted regulators to consider implementing policies to prevent it from monopolizing the telecommunication industry (Dontoh, 2020). This underscores the success that the organization has achieved in promoting its products.
MTN Ghana’s Marketing Mix
A marketing mix is the set of tactics that are used by an enterprise while promoting its brand. The management must consider factors related to the nature of service, its price, place(s) where purchases may be made, and promotion strategy (Otchere, E. S. Tenakwah and E. J. Tenakwah, 2015, pp. 66-67). Organizations that base their manoeuver on the understanding of customers’ needs outperform those which do not. Performance is enhanced when a firm communicates the value it has created to the consumers in an effective way (Vertigans, Idowu and Schmidpeter, 2015, p. 226). A marketing mix, therefore, enables a company to know the kind of service it can avail to clients as well as how to let them know of its existence.
MTN Ghana has dominated the market by offering a wide range of services and availing them at competitive prices. Among its main products and services include mobile telephony, consumer electronics, cloud computing, mobile money transfer, music streaming, sale of data, and e-commerce (Otchere, E. S. Tenakwah and E. J. Tenakwah, 2015, pp. 71-72). The company’s financial strength enables it to engage in price wars without risking bankruptcy (Akowuah, Xinying and Sohna, 2018, p. 125). Unless the provider is negatively impacted by government policies, it is unlikely for the competitors to dislodge it from the dominant position. MTN Ghana is the most visible telecommunication provider in Ghana. There is hardly any retail outlet without a poster promoting the company (Vertigans, Idowu and Schmidpeter, 2015, p. 228). The firm’s visibility casts a shadow over the competitors, and therefore, many customers do not see them as alternatives to MTN Ghana.
Competitive Strategies used by MTN Ghana
Although MTN Ghana dominates the market, the management recognizes the importance of constant innovation. The organization is usually the first to introduce a new product and/or service into the market. It has a team of experts who are dedicated to research and development. The team was formed after it was determined that first movers, especially those who come-up with differentiated products, benefit from strong brand recognition and customer loyalty. (Akowuah, Xinying and Sohna, 2018, pp. 98-99). Indeed, clients habitually stick with MTN Ghana even after business rivals avail substitutes into the market.
Commitment to innovation enables an enterprise to react to the actions taken by the competitors as well as to discover new business opportunities. In essence, therefore, the ability to come-up with new ideas gives the firm a competitive advantage. For instance, MTN Ghana regularly exploits its novelty to counter AirtelTigo or Vodafone new product releases with far superior alternatives (Gooderham, Grøgaard and Foss, 2019, p. 47). In most cases, the variants are sold at about the same prices as those being promoted by the rivals. Even in cases where MTN Ghana’s products are sold at slightly higher prices, the organization still wins customers over because of its popular brand name.
MTN Ghana’s Strategies for Coping with Commoditization
Commoditization is a significant threat to any organization, irrespective of its market share. It refers to the scenario where the market gets filled with rival products which are almost identical. Firms do not only duplicate products but copy business models as well. MTN Ghana has complained to AirtelTigo and Vodafone over the competitors’ consistent replication of its core strategy (Vertigans, Idowu and Schmidpeter, 2015, p. 228). At the same time, it has been making notable investment in technology, and this ultimately improves customer experience. Even though some of the products are similar, customers still choose MTN Ghana due to its reliability and efficiency.
Over the years, MTN Ghana has adopted a business model that is commoditization-friendly. It is challenging to fight commoditization in Ghana through legal means, and this is mainly because of the ambiguity of the Copyright Act, 2005 (Akowuah, Xinying and Sohna, 2018, p. 99). The law was designed to protect original authorship of pieces of entertainment, and a framework to safeguard computer architecture and software is lacking. Besides, Ghana’s criminal investigation agencies are ill-equipped to deal with piracy in the telecommunication industry (Otchere, E. S. Tenakwah and E. J. Tenakwah, 2015, pp. 66-69). Given the circumstances, MTN is compelled to closely monitor the trends in the market and respond to every product release by the competitors.
MTN Ghana’s Approach to Market Segmentation
Business organizations improve their performance when they target the most promising audience. Market segmentation is when a firm subdivides the target market based on interests, locations, and demographics of the consumers (Akowuah, Xinying and Sohna, 2018, p. 98). It proceeds to aim at specific customer categories based on their unique characteristics. By so doing, the company discovers opportunities which were previously obscured, and the effectiveness of the marketing campaigns is improved (Vertigans, Idowu and Schmidpeter, 2015, p. 226). Slitting up the market is important since resources are always limited, and there are competing needs to be met.
Market segmentation has enabled MTN Ghana to know its customers. That knowledge facilitates the identification of the wishes of a particular category of clients. Among the opportunities MTN has discovered are the underserved niche markets. These include youths below the age of 23 who are deemed to lack the purchasing power and adults above the age of 65 (Akowuah, Xinying and Sohna, 2018, p. 125). The management is keen on developing new products and/or services for such categories. This is in the hope that the new customers who are currently ignored will remain loyal to a firm that identifies and starts satisfying their desires.
Conclusion
Even though MTN Ghana has access to over half of the market, the management is mindful of the competition. The biggest threat is the ease with which rivals replicate the business model, technology, and products. Such actions tend to erodes its competitive advantage, and hence threatens profitability. In order to remain ahead of the pack, however, MTN Ghana focuses on offering customer service at a level that is hard-to beat, and this is particularly because the competitors have limited resources. There is significant investment in technology that has in-turn made the provider become the most efficient and reliable in the country.
Reference List
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Vertigans, S., Idowu, S. O., and Schmidpeter, R. (2015). Corporate social responsibility in Sub-Saharan Africa: sustainable development in its embryonic form. New York City, NY: Springer.