Nakumatt suffers social media attack

 

Nakumatt’s thinning stock was the target of a malicious rumour on social media yesterday, which encouraged customers to redeem all their loyalty points and buy goods without cash.

The message, spread via text and WhatsApp, alleged that the points on Nakumatt’s Global Card reward scheme would expire today.

It urged customers to redeem their points or risk losing them after the programme is discontinued, allegedly due to the retailer’s current financial troubles.

But Nakumatt denied the allegations, saying the loyalty card programme was not being scrapped and would actually be enhanced with new innovations.

“We have noted with great concern some erroneous comments on social media suggesting that Nakumatt is closing its popular and successful Global Card reward scheme,” Nakumatt Chief Marketing Officer Andrew Dixon said in a statement.

“The directors at Nakumatt can categorically confirm that the Global Card scheme is under no threat of closure and the company will soon be announcing further developments to enhance customer usage,” he added. The attack seemed to have been targeting the retailer’s cash flow by encouraging card holders to buy out the remaining stock without paying cash, which would put the supermarket in deeper distress.

Withdraw inventory

In 2016, Nakumatt paid 4,000 cheques valued at more than Sh200 million for its customers’ school fees initiative through the loyalty programme, a redemption of accumulated points at Sh2 each.

The figure may even be higher if one considers the general redemption on shopping besides the annual school fees payments.

The retailer is suffering stock-outs due to apprehensive suppliers who have threatened to withdraw inventory for non-payment. A thinly negotiated pact arbitrated by Trade Principal Secretary Chris Kiptoo is the thread that is holding the retailer together.

Nakumatt bosses promised to settle Sh3.2 billion upon receipt of the first tranche from a strategic investor who had indicated interest in a significant stake, but this has since been delayed for almost a month.

Its gross debt more than tripled to Sh15 billion in February 2015, from Sh4.2 billion in 2011, piling pressure on operations and resulting in long payment delays to suppliers.

The retailer has closed down three branches this year; two in Nairobi and one in Kampala.

Online attacks are gaining currency by the day in Kenya as unknown people use mobile platforms to circulate false alarms that have sent companies almost out of business.

After the collapse of Imperial Bank, a WhatsApp message listing about two dozen small lenders made the rounds on social media, alleging that they were about to be shut down.

Family Bank lost Sh23 billion worth of deposits in five days after a sustained campaign last November by saboteurs who claimed it would fall in a week.

Chase Bank was put under receivership after a similar campaign urging depositors to withdraw their money, which triggered a customer run on deposits.