Integrated Marketing Communication (imc) and Technology Adoption: a case of Safaricom’s m-pesa mobile Money Transfer Services in Kenya

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Martina Mulwa

PhD Student

University of Nairobi

P.O. Box 30335 Private Bag Nairobi

+254 722733070

Integrated Marketing Communication (IMC) and Technology Adoption: A Case of Safaricom’s M-PESA Mobile Money Transfer Services in Kenya.

Integrated Marketing Communication (IMC) is an aggressive marketing plan that captures and uses an extensive amount of customer information in setting and tracking marketing strategy. This study sought toinvestigate the IMC strategies used with the M-PESA money transfer services in Kenya. The study was necessitated by the fact that similar mobile money transfer services existed in Kenya but did not experience the same success in uptake and use as M-PESA.

The objectives of the study included identification of strategies and techniques used by Safaricom in the diffusion of  information of the service and in effect its adoption; whether the rapid adoption of the Service could be linked to the IMC strategies used; comparing the strategies used to diffuse M-PESA with those used with Airtel money by Airtel; identification of the challenges faced in IMC strategy development and implementation; and recommendations on effective use of IMC strategies in the adoption of innovations. Theories informing the study were the Theory of Planned Behavior and the Information Processing Theory.  

Literature reviewed explored prerequisites to effective adoption of innovations succinctly interpreting key concepts in IMC and closely interpreting the diffusion of innovations theory in respect to technology adoption and exploring models that supported adoption of innovations.The study was based on the interpretivist research paradigm. It focused on the understanding of how people

Dr. Ndeti Ndati


Multimedia University College of Kenya

P.O Box 15653-00503 Nairobi Kenya

+254 720468439

interpreted the rapid adoption of M-PESA money transfer services in terms of the strategies adopted by Safaricom in the deployment of the product compared to other competing products. The

population was sampled using both purposive and non purposive methods. A sample of 48 constituting users, agents and Safaricom officials participated in the actual research. Areas of concern included an exploration of critical and unique features of the product necessitating the rapid adoption and design and implementation strategies adopted by Safaricom Company. Research tools included interviews, a focus group discussion, a questionnaire, observation and content analysis complimented by knowledge gained from product launches and seminars. Secondary data was mainly from electronic Journals and research findings by other scholars. Secondary data was useful in rating the uptake and use of airtel money and the strategies used in its implementation. Data was analyzed qualitatively and using the computer aided data analysis program SPSS.

Findings of the study confirmed that Safaricom had used IMC strategies befitting their target market compared to its competition to diffuse information on the M-PESA innovation and thus the success of its adoption could partly be attributed to the unique IMC strategies.


Money transfer services provided by various institutions have been available in Kenya for a long time. In a study by MicroSave (2003), three forms of money transfer providers in Kenya were identified. These included the formal sector (e.g. commercial banks, postal corporation, the semi-formal providers (e.g. courier or bus companies) and the informal services (bus conductors or friends).The study cited sending money to support the elderly at home, payment of school fees, payment of bills, purchase of goods and payment of workers as some of the reasons why the service existed. The study also classified the users of money transfer services into large scale and small scale. Large scale users transfer large volumes of money and include government departments, Non Governmental Institutions, farm produce marketing agencies, corporations and cooperatives among others. The small and medium scale users include individuals and entrepreneurs who transfer funds to purchase items, pay school fees, support family or projects in the rural areas or pay debts. However the challenge over time as documented in the study has been availability, effectiveness, efficiency and reliability of the money transfer services (MicroSave 2003).

Prior to the venture into money transfer services by mobile service providers, initially by Celtel’s ‘Sokotele’ which was unsuccessful, money transfer in Kenya had been dominated by financial institutions. Despite the indisputable need to make or receive payments by individuals, public offices, house-holds or even businesses, (MicroSave, 2003) the available financial institutions were not accessible to the majority of Kenyans especially in the rural areas whose income could not support the establishment of a financial base for financial operations. A study by the Consultative Group to Assist the Poor (CGAP) in 2008 on branchless banking in Kenya cited the inadequate infrastructure for reaching out to customers, with only an estimated 20% of adult population having access to formal financial services through banks, Micro finance institutions (MFIs) and Savings and Credit Cooperatives (SACCOs). Over 80% of the Kenyan adult population was found to be excluded from the traditional financial services.

It is against this backdrop of an excluded viable population in dire need of an affordable and accessible money transfer service that M-PESA money transfer service was launched. As mentioned earlier, “Sokotele” by Celtel now Zain was the first mobile phone money transfer service in Kenya. However it offered nothing new for the least amount then for transfer was Ksh 5000 for a transfer fee of Ksh120, furthermore the concept died even before many Kenyans got to know about it, due to lack of proper planning on how to create awareness of the product, which is the initial step to the adoption of any innovation (Rogers, 2003). Though “Sokotele” was a new concept, it targeted the market already taken care of by the Postal Corporation through Posta-pay and money orders. Rogers (2003) in his Diffusion of Innovations theory, explains that one of the characteristics determining the adoption of an innovation is the relative advantage. This is the degree to which an innovation is perceived as better than the idea it supersedes. Based on this argument, it is evident that “Sokotele” concept did not factor in the target market that lacked in money transfer services. The gap in the money transfer service was to make financial services more accessible to those excluded from existing money transfer services. Traditional money transfer services showcased sophistication which intimidated the poor and illiterate hence excluding them from reasonable use of the services (MicroSave 2003). This exclusion explains why they fell prey to informal money transfer services like transporting the money oneself, through a friend or other un-licensed means which remain unreliable and insecure. The (MicroSave, 2003) study also revealed that there was an unmet demand for efficient, reliable and affordable money transfer services in Kenya. This was signaled by the proliferation of informal money transfer providers; and Micro finance institutions were thought as the alternatives because of their networks. However these institutions did not quite solve the problem as they did not meet money transfer requirements in terms of systems, capacities, floats and liquidity management as later revealed (CGAP, 2008).

The enthusiasm with which the launch of M-PESA money transfer service has been received with is evident in the number of outlets dotting most of the Kenyan towns, estates and market centers today. According to the Safaricom’s 2008/2009 Annual report and May 2009 investor update, M-PESA customers were 6.18 million and Ksh 17.1 billion had been transferred from person to person by March 2009.This is huge by Kenyan standards. Amazing is the fact that even “Mabati kiosks” operate the service; it is designed to facilitate secure, convenient and low cost money transfer service with some shops operating on a 24 hour basis.

Sending or receiving money requires efficient, reliable and affordable money transfer services whereby money can be deposited in one location and withdrawn in another in both urban and rural areas (MicroSave 2003). The study (MicroSave 2003) revealed that structural weaknesses in the financial industry in Kenya limited the access to money transfer services especially in rural and for generally for low income people. According to a study by the Department of International Development (DFID) 55% of adult Kenyans had access to mobile phones yet only19 percent were banked. Therefore there is a huge market that has access to mobile phones but not financial services and M-PESA is helping to fill this gap. In appreciation of the rapid growth in mobile penetration in the remote areas the Equity Bank Chief Executive Officer (CEO) Dr. James Mwangi while launching the bank’s mobile phone banking admitted that the mobile phone had laid a strong base for reaching out to those excluded from traditional financial services. He added that the growth of mobile phone solutions in rural Kenya and regionally showed that a well designed service could go a long way in serving not only the un-banked but the underserved customers in remote areas. He added that the mobile phone had spawned innovations that had taken financial services to the masses much faster than conventional banks would have ever done.

Statement of the problem

Since its inception in 2007, M-PESA has rapidly developed to become one of the most dynamic innovations for delivery of financial services using modern Information and Communications Technology (ICT).The innovation won the best mobile money service award at a GSMA global mobile awards gala dinner in Barcelona – Spain in February 2009. This innovation makes Kenya a world leader in the use of mobile phones to transfer money. To appreciate its rapid growth in popularity, it is important to note that the number of people registered in Kenya using the M-PESA service regularly has grown rapidly. The pioneer money transfer service in Kenya Sokotele did not achieve much, Zap initiated by Zain after M-PESA though cheaper and “much more than a money transfer service” is struggling to penetrate the market. Un-published studies done on “The adoption and usage of M-PESA”, by Olga Morawczynski, focused on the rapid adoption of the innovation, looking at the innovation per-se and not the diffusion of information on the innovation. The researcher is of the view that Zap and M-PESA are similar technological inventions what is different is the adoption pattern.

It is in the appreciation of the unique adoption of the money transfer service (M-PESA) that this study sought to find out what communication strategy, techniques and tools Safaricom used and continues to use in order to persuade new customers to adopt and sustain those already using the service. Was it using superior IMC strategies that Zain, its competitor, was un-able to implement? The study also sought to establish specific social, technological, environmental, and economic needs driving the rapid adoption.
Project objectives were to:

  • Ascertain IMC strategies and techniques that have been used with M-PESA-:

  • Demonstrate the linkage between IMC strategies used and the success in adoption-:

  • Identify any challenges M-PESA’s IMC strategies face: and

  • Recommend any strategies that would facilitate an effective adoption of money transfer innovations such as M-PESA.

Theoretical framework

Information Processing Theory

According to Miller (1956), information processing refers to the way individuals handle information at their disposal. Information processing theorists approach learning primarily through a study of memory (short, sensory and long term). The initial processing of information depends on the external stimulus available to a person. External stimulus has been variedly described as, among others, the sum total of communication obtained from the immediate ambient with which an organism/human interacts. Skinner, (1938), ‘the external environment of an individual remains the single most important determinant of his/ her behavior.’ This interaction takes place virtually everywhere; it generates an attitude in a person-depending on which culture or past experience an individual has had. The external stimulus provides the sensory memory with the materials to work on (process). These stimuli gain access to the sensory memory ready for either initial processing or even to be forgotten depending on its degree of importance. Depending on an individual’s culture or past experience, familiar stimuli may not necessarily need to be reinforced to produce a positive response. External stimuli also have a bearing in a person’s attitude development or change. Messages intended to generate a desired behavior in targeted persons or groups of persons may result to attitude that has been influenced from the previous undesirable behavior or totally newly developed. There is the element of serendipity in external stimuli, the attitude that examines the mismatch in the stimuli to determine whether it is an error to be corrected or novel to be preserved. Depending on the past experience this attitude determines a mismatch and immediately generates a response. Though it may be unintentional the external stimulus more often than not is sought. Individuals tend to seek familiar stimulus with which they have had a lasting positive experience.

For better retention, it is important for a source to point out the most important information through organization of few words that focus on the meaning and connecting messages to old information which helps audiences avoid cognitive dissonance. Messages derived from our own experiences are easier to remember than those that are new, contextualizing the message and personalizing it helps the audience find the relevance.
Eysenck and Eysenck (1980) also note that the extra mental effort required leads to keener attention, hence better storage in the short term memory, and subsequent transition into the long term memory. For communicators, therefore, messages that engage the recipient’s cognitive abilities in some effortful manner could have greater staying power than those that do not. For communicators in both print and broadcast media, this is significant since it reveals how messages are stored, and can impact on choice of form and channel when communicating information. According to Tan (1979) elaboration is also crucial in the designing of messages. It constitutes an inter-connective meaning placed onto the information in working memory, linking it to established conceptual structures in the long-term store. Elaboration is the most basic of all memory techniques. The more meaning given to what is to be remembered, the more successful one is in recalling it later. Some theorists claim that elaboration is the only process by which an individual can reliably maintain information for an extended period of time. The more elaborate this process, the more retrieval cues that are available, which strengthens the likelihood of subsequent retrieval. In addition, highly elaborated processes also tend to lead to more complete and complex conceptual models.
The Theory of Planned Behavior

The Theory of Planned Behavior is also a determinant in the adoption of any new technology. Proposed by Martin Fishbein together with Icek Ajzen in 1975, proponents believe that if people evaluated the suggested behavior as positive (attitude), and if they thought their significant others wanted them to perform the behavior (subjective norm), this resulted in a higher intention (motivation) and they were more likely to do so.

Relevance of theories to IMC

A major key to effective communication understands how consumers process the vast amount of information that comes their way each and every day. To cope, people select only that information that is perceived to be important and ignore the rest. Thus, people limit their span of perception as a way of coping. If the marketing message is to be selected and processed, it must: consist of sensory and life experiences that can easily be identified and transformed into a unified concept, have mental relationships to other categorized ideas, and fit into the categories and mental linkages that people have already created for themselves (Schultz et al 2002).

Marketing communication messages that are not recognizable are not related to each other, conflict with what has already been stored, or are simply unrelated or unimportant to the person will simply not be processed, but ignored. Communication only occurs when the consumer accepts, transforms, and categorizes the message. The storage and retrieval system works on the basis of matching incoming information with what has already been stored in memory. If the information matches or enhances what is already there, then the new information will likely be added to the existing concepts and categories. If it doesn't match, the consumer has to make a choice, either the new information can replace what is already there or the new information can be rejected. If rejected, the consumer would continue to use existing concepts and categories and ignore the new. This is called a "judgment system" in that consumers match or test new information against what they already have and then make a judgment to add to, adapt, or reject the new material (Schultz et al 2002). When consumers reject the information or do not add or attach it to what they already have, there is a failure to communicate. In many cases, the failure to communicate is the result of the marketer being unable to match his or her messages or fields of experience with those of the prospect or customer. Consumers use the same information processing approach whether the new data comes from advertising, sales promotions, a salesperson, an article in a newspaper or magazine or from what their neighbor says (Schultz et al 2002).The marketer who presents non-integrated messages risks not having any of his or her messages processed because of the conflict that occurs in the consumer's information processing system. For this reason marketers must integrate their messages or consumers will simply ignore them. 

Schultz et al (2002), state that among models of information processing proposed include networking concepts into categories. These groups of concepts are not only made up of chunks of information, but are also networked together in conceptual relationships. Key to understanding the relationships is understanding the cultural and life experiences that have created the existing network of information chunks that exist in the consumer's head.  Models of information processing that include the replacement model assume that it is possible for the marketer to "replace" previously stored information chunks with new ideas (Schultz et al 2002). What is said does not matter as much as how often and how loud the message has been transmitted. With enough exposure, the new will replace the old and the accumulation model of information processing which assumes that message consistency is critical since the consumer accepts, processes, and stores information about the product or service relative to what has already been stored will be accepted (Schultz et al 2002).The judgment system (perceptual consistency) prevents consumers from having multiple concepts or categories for the same message. Information that does not fit is rejected and not filled. That being the case, the need for Integrated Marketing Communication is not only needed, but critical to marketing success.

Steps in developing effective communication

According to Ogdan (1998) developing an effective IMC plan involves identifying whom to send the message to, how to send it, selecting the message source and collecting feedback. A marketing communicator starts with a clear target audience in mind. The target audience will affect the communicator’s decisions on what will be said, how it will be said, when it will be said, where it will be said, and who will say it. After defining the target audience, the marketing communicator must decide what response is desired. In most cases, the final response is purchase. According to Ogdan, (1998) the purchase is the result of a long process of consumer decision making. The target audience may be in any of six buyer readiness stages that consumers typically pass through on their way to making a purchase. These stages are awareness, knowledge, liking, preference, conviction, and purchase (Rogers 1993). The marketing communicator needs to know where the target audience is now and to what stage it needs to be moved. The marketing communicator’s target market may be totally unaware of the product, know only its name, or know little about it. The communicator must first build awareness and knowledge.

According to Ogdan (1998) suggests that designing a message for the diffusion is important. Having defined the desired audience response, the communicator turns to developing an effective message. Ideally, the message should attract, hold interest, arouse desire, and obtain. In practice, few messages take the consumer all the way from awareness to purchase. In putting together the message, the marketing communicator must solve three problems according to Shiffman and Kanuk, (1994), 1) what to say (message content), 2) how to say it logically (message structure), and 3) how to say it symbolically (message format). In the message content the communicator must identify an appeal or theme that will produce the desired response. There are three types of appeals identified by Shiffman and Kanuk (1994): 1) rational, 2) emotional, and 3) moral. Rational appeals relate to the audience’s self-interest. They show that the product will produce the desired benefits. Rational appeal messages may show a product’s quality, economy, value, or performance. Emotional appeals attempt to stir up either negative or positive emotions that can motivate purchase. Communicators can use such positive emotional appeals as love, pride, joy, and humor. Advocates for humorous messages claim that they attract more attention and create more liking and belief in the sponsor.

The marketing communicator needs a strong format for the message (Shiffman and Kunuk 1998). In a print advert, the communicator has to decide on the headline, copy, illustration, and color among other issues. To attract attention, advertisers can use novelty and contrast; eye-catching pictures and headlines; distinctive formats; message size and position; color, shape, and movement. If the message will be carried over the radio, the communicator must choose words, sounds, and voices. If the message is to be carried on television or in person, then all these elements plus body language have to be planned. Presenters plan their facial expressions, gestures, dress, posture, and hair style. If the message is carried on the product or its package, the communicator has to watch texture, scent, color, size and shape.

Choosing the media is also important (Kotler, 2003). The communicator must select channels of communication. The two types of communication channels are personal and non-personal. Personal communication channels are effective because they allow for personal addressing and feedback. The company controls some personal communication channels directly; company salespeople, for example, contact buyers in the target market. But other personal communications about the product may reach buyers through channels not directly controlled by the company. These may be independent experts, consumer, advocates, consumer buying guides, and others making statements to target buyers. They may also be neighbors, friends, family members, and associates talking to target buyers. The other channel is word-of-mouth influence, which has considerable effect in many product areas. Personal influence carries great weight for products that are expensive, risky, or highly visible. Companies can devote extra effort to selling their products to well known people or companies, who may, in turn, influence others to buy. They can create opinion leaders; people whose opinions are sought by others, by supplying them with the product on attractive terms.
Implementation of the communication process

According to Kotler et al (2000), after planning how to send information to the target audience the company has to decide on the total promotion budget and its division among the major promotional tools to create the promotion mix. Four common methods are used to set the total budget for advertising according to Russell and Lane (1993). These include: 1) the affordable method; 2) the percentage-of-sales method; 3) the competitive-parity method, and; 4) the objective- and- task-method. Schultz et al (1992), recommend that after setting the promotion budget and mix, the company must take steps to see that all of the promotion mix elements are smoothly integrated. This would include analyzing trends, internal and external that can affect the company’s ability to do business. This is done by looking for areas where communications can help the most, determination of the strengths and weaknesses of each communications function, developing a combination of promotional tactics based on the strengths and weaknesses, audit of the pockets of communications spending throughout the organization, itemization of the communications budgets and tasks and consolidating them into a single budgeting process. They recommend the reassessing of all communications expenditures by product, promotional tool, stage of the life- cycle, and observed effect, identification of all contact points for the company and its brands. They also work to ensure that communications at each point are consistent with the overall communications strategy and that the communications efforts occur when, where, and how the customers want them. Schultz et al (1993) encourage teaming up in communications planning through the following measures: 1) inclusion of customers, suppliers, and other stakeholders at every stage of communications planning and creation of compatible themes, tones, and quality across all communications media; 2) ensuring each element carries the unique primary messages and selling points to achieve greater impact and prevent the unnecessary duplication of work across functions; 3) creation of performance measures that are shared by all communications elements; 4) developing of systems to evaluate the combined impact of all communications activities; and; 5) appointing of a director responsible for the company’s persuasive communications efforts. The move encourages efficiency by centralizing planning and creating shared performance measures.

Innovation adoption models

Several communication models explain the adoption of technological innovations. Some are discussed below:

The Lazy User Model (LUM)

The Lazy User Model (LUM) of Solution Selection model (2007) tries to explain how an individual selects a solution to fulfill a need from a set of possible solution alternatives. According to Terald and Collan (2009), users will most likely choose the solution that will fulfill a need with the least effort. Lazy user model posits that a solution is selected from a set of available solutions based on the amount of effort the solutions require from the user - the user is supposed to select the solution that carries the least effort. The model draws from earlier works on how least effort affects human behavior in information seeking and in scaling of language.

The model starts from the observation that there is a user need, i.e. it is expected that there is a “clearly definable, fully satisfiable want” that the user want’s satisfied (it can also be said that the user has a problem and he/she wants the problem solved). So there is a place for a solution / product / service. The user need defines the set of possible solutions (products, service etc.) that fulfill the user need, therefore only the solutions that solve the problem are relevant. This logically means that the need defines the possible satisfying solutions - a set of solutions (many different products / services) that all can fulfill the user need. LUM is not limited to looking at one solution separately. The user state includes, age, wealth, location etc; everything that determines the state of the user in relation with the solutions in the set of the possible solutions to fulfill the user need. The Lazy User Model assumes that the user will make the selection from the limited set based on the lowest level of effort. Effort is understood as the combination of monetary cost + time needed + physical / mental effort needed.

Technology Acceptance Model (TAM)

Technology Acceptance Model (TAM) proposed by Davis (1989) is an information systems theory that explains how users come to accept and use a technology. It suggests that, when users are presented with a new technology, a number of factors influence their decision about how and when they will use it. Understanding the user’s behaviour towards a new innovation is key in the technology adoption process. TAM consists of two beliefs, perceived utilities and perceived ease of application, which determine attitudes to adopt a new technology (Davis 1989). The attitude towards adoption depicts the prospective adopter's positive or negative orientation/ behavior about adopting a new technology. According to Davis (1989) attitudes towards adoption are determined by relevant internal beliefs and are influenced by factors such as; 1) perceived ease of adoption; 2) apprehensiveness; 3) perceived utilities of technology (extrinsic motivation); 4) enjoyment (intrinsic motivation). In addition, individual characteristics like age, qualification, their prior experiences in adopting technology; technology suppliers' commitment; compatibility with existing technology and enhanced value are important factors. Social pressure is also another important factor.

Perceived ease of adoption is operationally defined as "the degree to which the prospective adopter expects the new technology adopted to be free of effort regarding its transfer and utilization"(Davis 1989). This measure reflects the potential difficulty for the adopter to utilize the new technology, especially if one is required to learn how to use the new technology. Improvement in ease of adoption can be instrumental to the utilization of technology. Perceived ease of adoption can also affect attitude directly. An innovation that is easy to implement and transfer can considerably reduce the time and effort a recipient needs to invest in the adoption. There is also a perceived probability that, the less complicated the transfer and application is, the more likely it will be successfully accomplished.

Apprehensiveness refers to the anxiety of using a new medium or technology. Apprehensions about adopters’ capability and preparedness to accept new technology especially consequential costs in the event of technology failure are enormous. Though this is considerably taken care of thorough simulation modeling , demonstration in pilot scale to address issues of observability and trailability, adopters still get worried when new innovations are introduced (Davis 1989).
Perceived Utilities of Technology (PU) (extrinsic motivation) is operationally defined as "the prospective adopter's subjective probability that applying the new technology from outside sources will be beneficial to the adopters personal well being" (Davis 1989). For organizations, utility usually means economic benefits resulting from adopting a new technology. These benefits may consist of increases in productivity, enhancement of product quality, cost savings, improvement in market share and entry of new market. To an individual adopter utility is most likely the result of improved performance and the associated intrinsic and extrinsic rewards. Intrinsic motivation induces activities where there is no apparent reward except the activity itself (Davis 1989). Intrinsically motivated behavior arises from people’s need to feel competent and self-determining in dealing with their environment. There is an inner drive to learn, learning is an investment. This enthusiasm may taper with age.
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