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Idea’s Missed Mumbai Opportunity

August 25th, 2008 · 9 Comments

Idea recently launched operations in Mumbai. It is interesting because it is perhaps for the first time in India that an operator is being forced to focus primarily on SWITCHING users (in an era without mobile number portability)  from other operators rather than just acquiring new ones. This is because Mumbai already has nearly 15 million mobile subscribers and a penetration of 70-80%.

Idea is the 5th largest Indian operator — finally entering one of India’s largest and most lucrative markets. And what is the campaign they launch? “Get yourself a Mumbai phone number.” Whatever that means. I mean,given the wayour behaviour is, we don’t even remember phone numbers anymore. The first time someone calls us, we probably end up adding it into our address book if we think its worthwhile. Mobile numbers are exchanged primarily via ‘missed calls.’ Whoever cares about the actual number. Maybe, I am wrong — but we will see soon. Idea has painted the town Yellow, but perhaps they should have focused more on the Message.

So, what could Idea have done differently to switch users? I think the entry strategy could have revolved only around one of two key ‘ideas’. The first, aggressive reduction of voice tariffs since voice remains 90% of the industry revenue. But they would have known that this would have been matched within hours by the others. So, it would have only ended up in taking industry revenues lower for everyone, and not necessarily ended up gaining them subscribers.  Alternately, Idea could have created a first-class service targeting high ARPU subscribers, who are also VAS (value-added services) hungry. Idea could have created an i-mode in India — a platform that could have gotten content and service providers excited, creating a positive feedback loop for the service rapidly. In essence, Idea could have thought disruptively and differently. But so far, they haven’t. They still have a golden opportunity — many of us in Mumbai are hungry for innovative mobile data services. Can an Idea change our lives?

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9 responses so far ↓

  • 1 Sanjay Mehta // Aug 25, 2008 at 12:31 pm

    Couldn’t agree with you more, Rajesh.
    I suspect they just could not get a unique proposition ready for Mumbai, and then went out with the current campaign that lacks imagination. I think someone in their marketing team should lose their job for this colossal waste! Otherwise, I quite like their ad campaigns, and the current one with the rural education theme touches the heart. Whether it makes sense as an idea or not, it does drive home a social message and works well for the brand!

  • 2 Gautam Kshatriya // Aug 25, 2008 at 2:58 pm

    @Sanjay – surely the campaign in Mumbai was yet another social message, responding to Raj Thackeray’s antics?

    Gautam Kshatriya
    gautam.kshatriya@moneyvidya.com
    http://www.moneyvidya.com

  • 3 Abhishek Mandloi // Aug 26, 2008 at 4:32 am

    BTW, !dea’s tag line is “An !dea can change your life” .. so how about “An !dea can change Mumbai”
    or by rich promotion on cheap calls.

  • 4 Girish // Aug 27, 2008 at 12:22 pm

    Could not agree more.

    Mumbai ka number, did not make any sense. Yes, they need to get the high ARPU guys.

    Try doing something similar to what Kingfisher did to get Jet Air frequent fliers. They gave all gold and plat card members of Jet, the same privilege on Kingfisher and also gave them a bonus – same number of points on their KF flight without taking a single flight.

    So any Voda, BPL or Airtel customer whose last two months data spend is over Rs.500 or if his total monthly bill is above Rs.1500, he gets a free Idea Sim card (prepaid or post paid) and cash back of Rs.200 pm, on data for one year. Basically have a huge incentive for them to take another card (as most old customers of these players, esp. post paid guys have been taken for granted for many years).
    Standard Chartered titanium card has a 5% cash back on all petrol and telecom expenses, and the initial response has been very good to it. It does work in other industries.

  • 5 kb // Aug 27, 2008 at 2:04 pm

    Comparing credit cards to cell phone services is an interesting one. Both are commodities and tend to be differentiated on the basis of service (amongst a few other things). The best eg of that is master/visa vs amex. Mc/visa clearly have wider acceptance and are cheaper for merchants and cardholders alike. Amex on the other hand isn’t fancied by most merchants since they charge 3-5% per txn vs master/visa’s 1-2% and nor by cardholders since their cards either come for a hefty fee (when most are free) or aren’t accepted by most merchants.
    Yet, as a ‘power user’ of cards (my billings are 5 to 10 times that of the avg Indian cardholder depending on which research report u rely on) I still prefer amex (and pay an annual fee) for 2 reasons – their rewards are (sometimes) better and most importantly their service. Call an amex helpline no vs an icici/hdfc/sbi/hsbc and u will see that amex clearly has more trained personnel attending to customers. This is most critical in cases where u need to escalate matters such as fraud or lost/stolen cards. Talking to personnel that speak clearly and professionally, especially in times of an emergency, is reassuring, rare and worth paying for.
    I’d love to see how the telecom players view this or if this even figures in their strategy. I’ve used Vodafone for long but continue to have issues with poor customer service, website perpetually down, etc. I wonder if IDEA factors these ‘customer touch points’ into their strategy. Else, they will be yet another ‘cheaper’ service provider fighting the lost battle called ‘price war’.

  • 6 Girish // Aug 27, 2008 at 2:33 pm

    Good point, but I don’ t think Idea can build a brand image similar to Amex, even if it takes a rebirth!

    Only if someone like a Apple enters the IndianTelecom service business through the MVNO route, can this be attempted.

  • 7 Brijesh Tripathi // Aug 28, 2008 at 3:29 pm

    Given the authority operators command over the services that a customer gets, it should be their ‘responsibility’ to get to the next level.

    I definitely agree with Sanjay on the earlier Idea ad-campaigns to be heart-touching – they could’ve done something similar here as well (and Gautam does rightly point towards that) but the basic point besides the communication of the brand is product and service – what is the differentiation here.
    they(operators) are the ones who need to take the ‘risks'(only to reap the benefits), bring out services which are currently unavailable, create the ecosystem currently only dreamt of. after all they have all the information and the control on it’s transmission.
    unless the operators bring out differentiated services ( maybe in collaboration with numerous developers/aggregators) there isn’t much that a customer can be lured into except perhaps an illusion communicated through some creative ads! – is that the only factor that they can create a differentiation on – has every possible kind of innovation in the space been done by all? .
    sometimes it makes me feel the only differentiation / innovation left for these operators is in the ads that they create – all heart touching(airtel); happy customers(vodafone); smart customers(virgin)…so on – seems like they have already positioned themselves on the creative side – with the services being the same.

  • 8 Basant Pandey // Mar 3, 2009 at 2:18 pm

    It is clear that no cellular company in Mumbai can live off only high ARPU users, ignoring the ones who buy a card just for the incoming. Neither can a company afford to have only these incoming subscribers.
    The idea is to have a two tier system.
    Idea should launch 2 series of numbers simultaenously, one fully loaded only billing and put forth as high profile for high ARPU users. They could have software routing helpline calls from these nos. to specially trained staff. A wide variety of offers could be included, similar to credit cards.
    The second series of numbers would be for the masses, the incoming and missed call subscribers. Dont forget that termination charges are as important as calling revenues, and this strata of subscribers would be form the bulk of the subscriber base.
    Soon it would be a fad to sport a premium connection from Idea, and promotions could make it a sought after service, targetting the aspirations of the consumer.

  • 9 Ideas for New Mobile Operators // Jul 13, 2009 at 5:00 am

    […] means that instead of trying to attract new users the focus has to be on switching users.I had explored this idea a few months ago when Idea had launched in Mumbai. This is what I wrote then: What could Idea have […]

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