The redesign is here – Kenya’s mobile network provider, Safaricom, is predicting that revenue from MPESA, its mobile money unit, will generate more than 50% of its revenue by 2022. In other words, MPESA will be bigger than selling airtime and broadband services for the telecom company. That would be a massive inflection point as it does imply that Safaricom has completed a double play strategy: build solid customer base in one area but make money in something else which is tangential.
Driven by a 19 per cent increase in revenues at Mpesa, the company reported annual service revenue of Ks240.3bn ($2.4bn) for the financial year to the end of March, an increase of 7 per cent. The mobile payments platform, which is used by two out of every five Kenyans to send money and pay for goods and services, generated almost a third of total revenues and will surpass 50 per cent in three years, said Mr Collymore.
Telecom services will remain the heart of Safaricom because the promise of MPESA will only ride on the telecom service users. Yes, MPESA derives its life from the users of the telecom services. As I have noted in the One Oasis Strategy, MPESA was engineered to make the telco service better by providing incentives for users to choose Safaricom network. But soon, MPESA is emerging as a great product that will anchor the company into the deep future.
Do you know the company that is making Samsung greater? Apple. Yes, that arch-rival is also the company that is feeding into the profitability of Samsung. As I explained in the One Oasis Strategy, there are just few firms in the world that can meet the quality and scale Apple needs. One of those firms is also the main competitor in Apple’s core business of mobile devices. The rivalry between iPhone vs. Samsung Galaxy is just for the newspapers: many things hold them together. The mobile devices are born from the same semiconductor factories.
Simply, Safaricom has executed One Oasis Strategy and Double Play Strategy at the same time. That is why it is one of the most respected brands in Kenya: it is fixing frictions at deep level in the lives of Kenyans.