By Peter Opondo
Around the year 2007, Citizen TV took the Kenyan media and entertainment market by storm when it poached top rated media personalities at a premium from rival stations.
Hitherto an underdog in the industry, Citizen which is owned by SK Macharia’s Royal Media Services (RMS) limited was deemed to be punching above its weight when it hired the likes of Swaleh Mdoe, Catherine Kasavuli, Louis Otieno (from KTN) and Julie Gichuru (from NTV), among others.
In as far as news anchors and presenters were concerned, these were the crème de la crème in Kenya and this represented a signal that Citizen was ready to take on the big boys in the industry- and it did. Within a very short period, Citizen moved from number four to number one among national TV stations; a position that it has held onto to date.
Fast-forward to January 2013 and another newbie in the market, K24, pulling a page from the Citizen playbook attempts a similar human talent strategy to upend the market status quo. Seemingly flush with cash, the Mediamax Network Limited owned K24 channel, just like Citizen TV a few years earlier went for established names from rival stations. The likes of Belinda Obura, Tom Mboya, Frankline Wambugu, Jimmi Gathu, Torome Tirike (from Citizen TV), Isabella Kituri and Ann Ngungi (from KTN), Tichi Nyasani and Waweru Njoroge, among others, were recruited. K24 was announcing that it was now ready to wrestle the mantle from Citizen TV. Only that it didn’t pan out that way.
K24, it would turn out, had bitten more than it could chew and like a marathoner who begins the race in a sprint, the channel would soon be running on fumes just a few months later.
Since then, industry observers and analysts have been wondering how a seemingly similar human talent strategy executed by two different players in the same industry could produce such diametrically opposite results. The contrasting outcomes have since provided material for discussion among students of journalism and media strategy in local universities as well as in the boardrooms of media houses.
In this article, I would like to lend some perspective. I will argue that although the approach taken by the two stations were similar, the strategic intents were quite different. Further, I would posit that even if the strategies were similar, different contexts led to the divergent outcomes.
A Disruptive Innovation perspective
When reviewing a strategy, a good management theory always comes in handy. In this case I choose to deploy the Disruptive Innovation theory as advanced by the late Prof Clayton Christensen of Harvard Business School as the lens through which one can analyse this particular challenge.
In simple, non-academic terms, the Disruption Innovation theory basically says two things; first, that when you are an underdog or a newbie and you want to disrupt a market, taking on the incumbents head-on can be extremely risky. This is because the incumbents will often spare no expense in defending their territory. And because incumbents usually have more resources than new entrants, the winner of this arms race can be predicted beforehand.
Secondly, the theory postulates that the best way to disrupt a market is to go for the consumers that the incumbents have overlooked, overshot (as in giving them more than they need, often at a high price) or regard as non-priority. Target the so-called “non consumers” or the consumers who are using a product or service simply because there is not better alternative- the “soon-to-be-non-consumers”. This gives the disruptors an advantage because, first, the incumbents are likely to ignore you and secondly, you quickly build a critical mass of customers that will provide the moat to enable you to attack the market upstream.
This is also the underlying concept of the Blue Ocean Strategy as advanced by professors Chan Kim and Renee Mauborgne, where any entrant into a market or a corporate strategist is always advised to avoid the “bloody red ocean” where competition is intense and cut throat and instead urged to go for the “blue ocean” where there are opportunities to create new markets and value.
To use cross industry examples, this is exactly how Equity bank gained dominance in the banking sector in Kenya; by first going to the low end customers that the other players had completely ignored and used that foundation to gradually go upstream. Also, this is exactly what Mpesa did to the financial services sector- by capturing the low-end masses that had been excluded from the financial services sector, eventually forcing mainstream players in the sector to plug in and align.
Back to the media. Around 2005, Citizen TV was a distant number four in terms of ratings among key players in the industry. KBC, KTN and NTV were the leaders nationally in that order, although when it came to urban areas KTN was ahead, followed by NTV and then KBC.
After the liberalization of the airwaves in the early 1990s which broke the monopoly of state broadcaster KBC, KTN and NTV became the gold standard of TV in Kenya. The stations were urban and sophisticated, serving their audiences a surfeit of mostly American content. Programs like Fresh Prince, Desperate Housewives, Judging Amy, Prison Break, CSI, Smallville, Lost, Monk, and ER were the main staple.
The unconscious conspiracy
When Wachira Waruru was appointed managing director of RMS around 2005, he already had an insight. “There was an unconscious conspiracy against the ordinary Kenyan viewer,” he told me a few years ago. And that is the insight that led to the Kenyan and African content strategy at Citizen TV.
And here is the key to the success of the strategy; Citizen did not initially go for the top news presenters. It went for entertainment content that could celebrate the “Kenyan identity”. It went for content that created affinity with the ordinary Kenyan. That is how shows like Papa Shirandula, Inspector Mwala, Tahidi High and Tafrija (local Kenyan music show) came about. Because the market was so fixated on foreign content that so far was attracting good advertising revenue, the main industry players did not immediately respond to the Citizen strategy.
“They didn’t see us coming. In fact Nation Media Group even allowed us to take out full-page advertisements in the Daily Nation to market our new content. Across the week you would see a full-page image of Papa or Mwala! To them we were not serious competition so they promoted us. Today they would not allow us to take out even a classified ad,” Wachira told me sometime in 2018.
So by the time Citizen went for the top presenters from NTV and KTN in early 2007, it already had a base of captive audience. And the Strategic intent of hiring the top anchors was not necessarily to help Citizen TV
penetrate the market (much as it could have led to that), rather it was a statement to the industry that the channel was now going upstream, ready to take on the big boys.
Contrast that with the K24 strategy in 2013. After its acquisition from the founder Rose Kimotho, that station was about to rebrand from a 24/7 news and current affairs channel to an entertainment and news channel, just like the rest of the main players.
The K24 strategy however was to go head-on against the leading market players, especially Citizen TV. Put differently, K24 strategy was “steal of market share”, as marketers would put it. Such a strategy often amounts to a zero sum game; that for you to win, someone else must lose.
And so with minimal tweaking here and there, the 2013 K24 programming line up mirrored that of Citizen TV. K24 was strategically intent on blowing Citizen TV out of the water, and that is what informed the hiring of the top news presenters.
As noted earlier from the theory of disruptive innovation, this can be such a costly and expensive affair, as it proved to be for K24. Barely 6 months after the high profile poaching, some of those that had been hired were declared redundant. The numbers were simply not adding up and the company was hemorrhaging cash in a manner that could easily bring the entire company down if not stopped.
To use an analogy to contrast the strategies of the two stations in recruiting high profile presenters, I would put it this way: Citizen TV had already baked the cake, the presenters were just the icing on it. K24, on the other hand, was serving the anchors as the cake.
(Full disclosure: I worked for both Citizen TV and K24 at management level. Specifically, I joined K24 a few months after the 2013 poaching spree and product re-launch. Contractual obligations preclude me from revealing some of the nitty-gritty about what took place. This article is purely meant to shed some light on strategic actions in the media in Kenya and their impact on the business in general and the lessons that can be drawn thereof, if any)
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