Digital business: telcos repositioned for key role in Nigerian economy

Just imagine, society at a point when our service providers suggest customers to our business accounts upon registering perhaps a SIM card or an email address in our company’s name. Precisely, the same way our social media networks suggest friends from our phones and email contact list.  For those of you already taking advantage of targeted marketing tools and services, you know exactly what I mean.

Every minute, the number of people, businesses, and devices communicating on the back of internet connectivity is growing. Projections put the number at seven billion, that is the number of businesses and people to be linked to the internet by 2020. This interconnectivity as such is fast blurring the line between the physical and digital space, disrupting existing business models. Essentially, that sums up the term digital business.

Enterprises, both new and existing which fail to place technology (alongside innovation) at the heart of strategy are more likely to fail in the near future.  Please note, that the hard headed lot which shun technology adoption in favor of a bloated workforce still end up on the losing side, as their more nimble counterparts with cutthroat turn-around-times capture more market share.

On the local front, Nigeria, our telecom market is one of the largest in Africa, backed by the second largest economy on the continent. I need not mention the power of the population to influence investment decisions.

 

 

A while back, the telcos had a utility mentality whereby inelastic tariffs on their traditional voice and messaging services was all that mattered. Today, the reverse is the case due to competition and the depth of market penetration. Telcos as such, have reorganized their business models to adapt to changing revenue structures and the encroachment of disruptors such as Whatsapp.

 

 

 

 

We need to hand it them though, despite their behemoth size, they have been able to adapt. 9.80% of our GDP was derived from the telco sector in the first quarter of 2016.

Using figures from the Nigerian Communication Commission (NCC), the subscriber base as at September 2016 stood at 153.3 million with 93.6 million of this lot subscribing for data.

 

Comparison against 2005 figures (subscriber base) shows an exponential growth which has slowed of recent. Deep market penetration has left less space for large expansion and telcos have thus taken the initiative to forge new relationships across industries. The most notable so far has been with the banks.

Collaborations as such, position telcos to play the role of middleman or in other words to serve as conduits for businesses to reach potential customers. These industries on their part hand have recognized the direct link which telcos posses to an enormous customer base, not to mention the fact that they own the underlying infrastructure.

Now, by taking the next step and delving into analytics, we realize that the information residing with these telcos is priceless. Using adequate mining techniques, personalized services which is the ultimate in retail business becomes a low hanging fruit, thereby growing a healthy producer-consumer ecosystem

On the international plane, telcos are now seen to be competing with leaders in the international money transfer space, insurance marketers and established online distribution platforms .

With increased broadband adoption and a multiplicity of touch points, the repository of user data continues to grow. For the protracted future, Telcos have a significant role to play by putting all that information to use and forging the relevant relations across industries.