After undergoing a significant rebranding initiative, Cell C is setting its sights on regaining its status as the third-largest telecommunications operator in South Africa, with aspirations to rival market leaders Vodacom and MTN. The company unveiled its new visual identity, including a revamped logo, during an event on 15 August 2024, signaling a renewed commitment to its brand.
Melanie Forbes, Cell C’s chief marketing officer, addressed the gathering, acknowledging that while Cell C is a well-recognized name among South Africans, the challenge lies in persuading consumers to see it as a top-tier service provider.
Cell C aims to extend its influence beyond traditional telecom services, with a renewed pledge to contribute significantly to the socio-economic advancement of South Africa.
Forbes emphasized the loyalty of millions of South Africans to the brand and the company’s desire to honor the legacy that has positioned Cell C among the Top 30 South African brands. She clarified that the rebranding initiative was not a result of new leadership but a strategic move to enhance the brand’s market position.
Forbes encouraged South Africans to embrace the dual benefits of superior network quality and value that Cell C offers, urging them to make the switch and see the difference for themselves.
To realize these ambitions, Cell C is intent on reshaping public perception regarding its network reliability and customer service. The company is keen to reestablish itself as an innovative “challenger brand” and a “disruptor” within the telecom sector.
This approach aligns with CEO Jorge Mendes’s strategy, as he previously expressed to the media that Cell C’s immediate goal is to surpass Telkom and reclaim its former status as the nation’s third-largest telecom company.
Despite having held the third position for many years, Cell C fell behind Telkom in terms of mobile subscribers in 2020.
A key element of their strategy is addressing a longstanding issue: the attraction and retention of talented staff.
Mendes has made it clear that he aspires to cultivate the best corporate culture in the country, aiming for high staff retention rates.
At the rebranding event, he reiterated his ambition to not only lead in the telecom industry’s corporate culture but to set the standard across all South African companies.
In a conversation with Daily Investor, Mendes expressed confidence that following the rebranding, Cell C is well-positioned to challenge Telkom and reclaim its third-place ranking.
Mendes outlined the company’s objectives to grow and enhance key performance indicators such as revenue, market share, and customer base. However, he stressed that the primary focus is on ensuring sustainability, with the belief that this will create momentum for Cell C to thrive in a competitive market that extends beyond just two major players.
With a positive outlook, Mendes suggested that once Cell C secures the third spot, the potential for further advancement is open-ended, contingent on the direction of the company’s momentum.
Mendes has acknowledged that a potential challenge for Cell C arises if it successfully solidifies its position as the third-largest telecom player and begins to encroach on the market share of the leading incumbents, Vodacom and MTN.
This development could pose a risk to Cell C’s strategic partnerships with these top two telecom companies. In 2020, Cell C announced a shift in its business model, deciding to halt investments in its own radio access network infrastructure and instead enter into partnerships with MTN and Vodacom.
As a result, Cell C now relies on Vodacom’s roaming services for its contract customers and utilizes MTN’s virtual radio access network to cater to its prepaid and Mobile Virtual Network Operator (MVNO) clients, including those from Capitec Connect.
The prospect of Cell C emerging as a competitor to Vodacom and MTN could potentially jeopardize these crucial partnerships. Earlier in the year, Mendes expressed to MyBroadband that the major mobile operators in South Africa would prefer Cell C to remain financially weak.
“The market needs us to be successful. We aim to succeed, but not in the way they envision,” Mendes stated to MyBroadband. “They would rather see us barely surviving, dependent on life support. That’s not the future I envision for Cell C.”
While Mendes did not explicitly name “they,” it was implied that Vodacom and MTN would favor maintaining the current market dynamics over dealing with a revitalized and disruptive Cell C.
When questioned about his concerns regarding Cell C’s reliance on Vodacom and MTN for network services, Mendes expressed confidence. He pointed out that beyond ethical considerations, there is a financial motive for Vodacom and MTN to provide quality service to Cell C.
“I compensate them for the service quality and data consumed by our customers. We are among their largest clients,” Mendes remarked. He mentioned that Cell C has had positive commercial discussions with both networks, who are fully aware of Cell C’s ambitions and competitive stance in the market.
Despite the recent brand refresh, Cell C has already been making strides in competing with the industry leaders. Network tests have indicated significant enhancements in Cell C’s network performance, attributed to the new network strategy the company has been executing over the past four years.
The latest MyBroadband Insights network quality report showed that Cell C’s average download speed jumped from 28.70Mbps in Q1 2023 to 39.32Mbps in Q1 2024, allowing it to surpass Telkom and secure the third position in terms of network quality, trailing only behind MTN and Vodacom for the first quarter of 2024.
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