Customer Loyalty Points (Bonga Points) as a Public Relations Strategy for Customer Retention at Safaricom PLC

Abstract

The current telecommunication business environment is characterized by stiff competition and organizations strive for effective public relations strategies to retain their customers. Customer loyalty programs have over time evolved as strategic techniques for retaining customers. This study sought to establish role of loyalty points (Bonga points) as a public relations strategy for customer retention by Safaricom Plc. Specifically, the study objectives were to: assess how customer loyalty Bonga points affect the consumption of Safaricom products and services; determine the extent to which customer loyalty Bonga points is utilized at Safaricom Plc as a public relations strategy for customer retention; and establish the nexus between customer loyalty points and customer retention at Safaricom Plc. The study was grounded on the Excellence theory and Social Exchange theory. This was a case research, which employed evaluative design and further mixed-methods approach in order to understand experiences of both individuals and groups in the organization. 600 customers of the Seasons- Equity Market in Kasarani Sub-County were targeted by the study. Structured questionnaires administered via google platform generated quantitative data while for qualitative data, semi-structured interview guides were used administered via WhatsApp and Google Meet. Consequently, 10 customers and 10 employees were selected purposively for the interviews. The finding revealed that a majority of the customers accumulate Bonga points to redeem when need a rises to purchase a specific Safaricom product or services and that this influenced their consumption of Safaricom products such as minutes, SMS, internet bundles and mobile phones. The findings also revealed that loyalty points motivated customers and increased consumption of Safaricom products. Additionally, the findings indicated that customer retention was important for continuity. Safaricom had invested on Bonga points as a customer retention strategy even though there are other public relations strategies for customer retention revealed in the study as; corporate social responsibility activities, use of brand ambassadors and market influencers. The study also found a direct relationship between loyalty points and customer retention and that Bonga points had affected consumption of Safaricom products and that rewards systems like Bonga points were important in enhancing loyalty and further those loyal customers do not defect to competitors. Consequently, the study recommends that segmentation on the basis of customer needs and preference be incorporate in design of loyalty programs to enhance effectiveness of the program as a customer retention strategy. The study also recommends implementation of an effective communication strategy and a feedback system to capture customer views and suggestions regarding loyalty programs. Further studies could be undertaken on the strategies revealed in this study as corporate social responsibility, customer relations and market influencers and their influence on customer retention within the telecommunication industry.