Business Competition
Stabroek News
February 23, 2007
I admired the way Digicel entered the cell phone market with the acquisition of U-Mobile and then their expansion of the network. Not since RoopGroup came on the scene in 2004 have we seen such massive advertisement and promotion.
The goal in business is to make a profit by selling a product or service. In most situations several companies will be competing for sales and the market share. This competition can range from performance competition, where each company does its best to win the hearts and minds of the customers, to a head-to-head competition, where a company will not only seek to do better than its opponents but will also try to prevent the competition from performing well. Large companies may use predatory competition to assure their top position.
I happen to like GT&T because of their longevity and their commitment to a market that never had cell phones prior to their introduction of this service. They have invested significantly in Guyana and were now seeing a major return on their investments. On the other hand competition is very healthy for the consumers.
What we are seeing between these two cell phones providers are a Head-to-Head competition. In some cases, companies will compete directly with their top competitors. They will not only try to perform well, but they will also try to make it difficult for their opponents to do well. Since the opponents may be also using such tactics, they will need to use good defensive measures to deflect the attacks.
Marketing and advertising sometimes employ negative ads about the competitors. The best ads indicate lack of quality of the competition through the use of implication. We already see the claim by Digicel that they have the best network in Guyana without a chance for their subscribers to give testimonials of their service. I have known for a fact travelling around the country that my GT&T cell phone has performed well in very remote areas. I commend GT&T for their steadfastness in staying in a market when companies like Digicel refused to come to Guyana in the early days and first went throughout the Caribbean prior to their entrance. Thanks to GT&T for their pioneer service and I sincerely hope that their service and marketing departments can get the great testimonials from customers such as me that believe in their service. The key issue between these two companies will be the ability to compete for sales and the market share. I know many will switch for a nice looking cell phone and cheaper service.
The one negative aspect of this cell phone battle is the fact that there was a political overtone to the entrance of Digicel and the public remarks from senior government officials against GT&T. Calling GT&T a monopoly when other cell phone companies went other places and some were refused entrance into Guyana because of political differences including one friend of mine that lost over $US2M after he was refused a licence.
Business competition is healthy for Guyana and is more efficient when consumers get the best possible part of the deal. Until next week "Roop"