How a brand repositioning helped Telkom reverse years of declining perceptions, close a 35-point awareness gap and drive 16% broadband growth and 52% growth in mobile connections.
The business challenge
Telkom had once been one of South Africa’s most recognised and loved brands. By 2014, years of structural change, customer frustration and intense competition had left both the brand and the business under pressure.
The decline had been building for more than a decade. Telkom’s fixed-line connections had started falling as early as 2001, several years before the global fixed-line decline accelerated. Broadband initially provided a new source of growth, but high pricing and poor service perceptions steadily eroded customer goodwill. At one point, South African broadband prices were reported to be more than four times the global average.
As mobile connectivity expanded, Telkom also began losing its historical grip on the broadband market. Its share fell from around 83% in 2004 to 41% by 2008 as Vodacom, MTN and other wireless providers expanded. Telkom’s own mobile business struggled to gain traction, holding approximately 2% market share after almost four years and recording significant losses.
The reputational damage compounded the commercial problem. Customers created sites such as Hellkom and Telkomsucks to vent their frustration, while repeated leadership changes and negative corporate headlines reinforced the sense of a business in decline.
By 2014, the consequences were visible in the brand metrics. Consumer awareness trailed Vodacom by 35 percentage points, consideration was on a sustained downward trajectory and Telkom had lost the authority it once held in the business market.
New leadership had begun changing the organisation. Marketing now had to give customers a reason to see Telkom differently.
What the analysis revealed
The challenge went deeper than communications.
Telkom was competing in a category that had fundamentally changed. Fixed voice was declining, mobile had become mainstream and connectivity was increasingly moving across devices, locations and services. Simply promoting Telkom as another provider of connectivity offered little competitive advantage because connectivity had become a basic expectation of the category.
Looking at developments in more advanced telecommunications markets highlighted the next opportunity: convergence.
Consumers were already highly connected at work and increasingly connected on the move. The home was becoming the next battleground, with broadband, Wi-Fi, mobile and other services converging around a single connected household.
This was particularly relevant to Telkom’s priority consumer audience. More than half were higher-income families, technologically confident and likely to buy technology for collective household use rather than simply for themselves.
There was also an important brand insight.
Telkom had historically talked about “tomorrow” and the possibilities technology might bring. Yet a promise of the future had little power for customers already sceptical about the company. People wanted to understand what technology could do for them now – in their homes, businesses and everyday lives.
That gave us the basis for repositioning the brand around immediate relevance rather than distant technological possibility.
The strategic shift: make the future useful today
The strategy became:
Tomorrow starts today
The idea allowed Telkom to retain a connection with its heritage as a technology brand while fundamentally changing how that promise was expressed.
Future-facing technology would now be demonstrated through benefits people could experience immediately. The strategy moved communication away from technical language and infrastructure towards simple, useful outcomes.
Three principles guided everything that followed. Communications had to be benefit-led rather than technology-led, simple enough to make a complicated category easy to understand, and warm enough to begin changing the emotional relationship people had with Telkom.
That combination mattered. Telkom needed to demonstrate technological capability while becoming more accessible and human at the same time.
How the strategy worked
Make the connected home the growth battleground
Convergence provided a commercially relevant space in which Telkom had genuine assets.
The business could combine fixed broadband, Wi-Fi and mobile connectivity around the household, creating a stronger role for Telkom in people’s increasingly connected lives.
SmartHome became the commercial expression of this thinking. The underlying products were largely existing Telkom services packaged more clearly around the needs of the household.
The strategic value came from making those services easier to understand and more relevant to how customers actually wanted to live.
Build one Telkom instead of separate consumer and business brands
Telkom had traditionally developed different campaigns for its consumer and business audiences.
We challenged that approach.
The contexts differed, but the underlying brand challenge was shared: both audiences needed to see a more relevant, understandable and modern Telkom. A single strategic platform could therefore work across both, with executions adapted to the needs of each audience.
This gave Telkom greater consistency and efficiency. Every communication could contribute to the same brand meaning rather than building separate stories in parallel.
Connect brand building directly to commercial activation
The strategy deliberately connected the brand relaunch with the subsequent Summer of Wow retail programme.
The brand activity was designed to rebuild awareness, likeability and perceptions of Telkom. Retail activity then converted that renewed attention into clearer product propositions and reasons to buy.
This created a progression from reappraisal to consideration to action, rather than treating brand and sales activity as unrelated marketing programmes.
Bringing the strategy to life
“Tomorrow starts today” needed a creative device capable of making telecommunications feel simple and engaging while signalling that Telkom itself was changing.
Talking babies became the expression of that idea. Babies naturally represented tomorrow, but in the campaign they were already confidently using and discussing technology today.
The device also solved a practical communications problem. Complex products and services could be explained conversationally and with humour rather than through the technical language common in telecommunications advertising.
Different environments allowed the same platform to stretch across audiences. Consumer executions placed the babies in the home, while business executions used workplace-inspired settings.
The brand campaign was then supported by retail communications across television, radio, print, outdoor, digital and activation, allowing the repositioning and product offer to reinforce one another.
The brand turnaround
The commercial results were supported by substantial movement in the measures the repositioning had been designed to influence.
The awareness gap fell from 35 points to 19
Before the relaunch, the consumer awareness gap between Telkom and Vodacom had been widening — from 28 points in September 2013 to 31 points in December and then 35 points by August 2014.
Following the relaunch, the gap fell to 19 points by December.
Within the business market, Telkom also began separating itself from competitors, establishing an average awareness advantage of around 10 percentage points during the campaign period.
Consideration stopped sliding
Consumer consideration had been declining with a trend-line gradient of -0.018.
Following the campaign, that gradient moved to -0.0038, representing a 79% reduction in the rate of decline.
Business consideration, which had been growing only marginally, also accelerated sharply during the campaign period.
The brand began to mean something different
Tracking showed improvements across perceptions including innovation and leadership, technological advancement, reputation and organisational stability.
The brand relaunch advertising also substantially exceeded the 11% advertising noting norm. The launch execution achieved 26% among consumers and 43% among business audiences, showing that the work was succeeding at the first hurdle for a damaged brand: getting people to notice Telkom again.
The commercial impact
The changes in brand performance were accompanied by strong commercial results.
Broadband connections grew 16%
The objective was to exceed the previous year’s broadband growth rate of approximately 9.5%.
During the comparable September-to-December period, broadband connections grew by an average of 16%, versus around 10% in the previous year.
The combined SmartHome sales target across fixed and wireless products was exceeded by 33%.
Mobile connections increased 52%
Telkom Mobile was competing from a weak position in an already saturated market.
During the four-month campaign period, mobile connections grew by an average of 52%, almost twice the 28% growth recorded during the equivalent period the previous year.
This was achieved while some of the country’s largest mobile competitors were themselves experiencing subscriber pressure.
Could the growth be explained by something else?
The effectiveness analysis examined several alternative explanations for the performance.
Distribution had not increased. Telkom was actually closing some stores as part of a rationalisation programme.
The commercial offers were also broadly comparable with those available previously and with the promotional activity common across the category. SmartHome itself largely repackaged existing products rather than relying on a breakthrough product launch.
Seasonality was accounted for by comparing equivalent September-to-December trading periods across consecutive years.
The results also did not come from dramatically increasing Telkom’s advertising weight. Its share of voice had fallen from approximately 29% in 2012 to 19% in 2014, while marketing expenditure as a percentage of revenue remained broadly stable.
The business therefore generated stronger brand and commercial performance while commanding a smaller share of category voice than it had two years earlier.
That provides much stronger evidence that the change in positioning, communication and product presentation contributed materially to the turnaround.
Why the strategy worked
The strategy began with the commercial reality rather than simply the communications brief. Convergence identified a genuine future growth space for Telkom, particularly around the connected home, while the repositioning gave that opportunity a simple customer-facing meaning.
It also addressed Telkom’s accumulated brand baggage without pretending the past did not exist. “Tomorrow starts today” signalled change through what the business could offer customers immediately, making the promise more credible.
The decision to use one strategic platform across consumer and business created consistency and allowed each piece of activity to reinforce the same brand. Connecting that platform to retail activity then created a clear path from renewed awareness and consideration through to sales.
Most importantly, the results appeared at several levels at once: people noticed the brand, perceptions improved, awareness recovered, consideration strengthened and broadband and mobile connections grew.
That is what made the work a brand turnaround rather than simply a successful advertising campaign.
Capabilities demonstrated
Brand Strategy | Brand Repositioning | Growth Strategy | Customer & Market Insight | Value Proposition | Portfolio Strategy | Communications Strategy | Integrated Marketing | Marketing Effectiveness
My role
As Head of Strategy, I led the strategic development of the Telkom relaunch – from diagnosing the commercial, category and brand challenges to identifying convergence and the connected home as the growth opportunity, developing the “Tomorrow starts today” positioning, and creating a single strategic platform across consumer, business, brand and retail activity.
This work was completed during my agency career, working in partnership with the Telkom team and wider creative, account and media teams.