Telcos

Cell C Lost 28% Of Its Customers, But Its Not Worried

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Cell C
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Telecommunications company, Cell C, has been hitting the headlines for the wrong reasons, so to speak. Just the other day, it was revealed that the company plans to close over half of its physical stores and now there’s news that the telecom lost 28% of its subscribers between June 2019 and May 2020.

While such news would shake any other company to the core – losing almost a third of your customers is not something to be taken lightly, Cell C seems to be pretty much okay with it.

According to the telecoms, the reduction of their user base is as a result of the company shifting its attention to pursuing more profitable customers as opposed to wasting resources on low-value customers. As per their words, “this has resulted in a reduction in the Cell C customer base. With a decline of 28% on the base, we have maintained and grown revenue based on the trend.”

In other words, the loss in subscribers has resulted in an increase in the quality of its subscribers, which in turn has stabilized the telecom’s revenue. Cell C’s revenue only declined by 2% during the reporting period, from R14.247 Billion down to R13.901 Billion.

Cell C revenue versus subscribers over the last year

As part of Cell C’s strategy, the company has also removed non-profitable products from its portfolio and instead shifted focus on retail product pricing. To turn around its fortunes, the orange-clad telecom has implemented a strategy to cut costs through reducing redundant workforce and closings stores to focus more on online delivery of services.

“Although no certainty exists around the successful implementation of the recapitalisation, management remains optimistic,” said Cell C’s investors.

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