a day at dtac ChiefOpE:D

Why customers are now forcing telcos to focus on value

  • The erosion of prepaid matches Thai consumers rapid digitalization, who are among the world’s biggest consumers of social media.
  • With the shift to postpaid comes a greater focus on the value of internet connectivity, rather than adjacent gimmicks or device subsidies.
  • dtac has been restructured to meet these new needs, with Panya Vechbanyongratana heading the Commercial Group, which integrates both sales and product offers functions.

This is a guest post by Panya Vechbanyongratana, Chief Commercial Officer, dtac:

The telecommunications industry needs to change because consumers have changed. Four to five years ago, there was still such a thing as occasional usage. If you weren’t among the power users, maybe you didn’t call that often, maybe you only sent an SMS when you had to, not just to chat. That kind of user felt prepaid was a better model to control their expenses.

But now, your phone is consuming a constant trickle of data. Or a full-on river of data. Either way, the occasional user is nearly gone. Even grandmothers are consuming data, chatting on LINE, streaming video on Youtube, posting on Facebook. Everyone is. Thailand is among the top 10 countries for usage on all three of those platforms. Buying data occasionally on a prepaid plan just doesn’t make sense when your usage becomes constant. And that usage is only going to increase. People are starting to come around to the idea that they’d be better served by a good monthly plan.

With this increased usage, people have also realized they need a good phone. Those cheap phones telcos brought in from India and China to woo customers over to them have done more harm than good. They’ve polluted the market and damaged consumers’ trust. It was like getting a free two-night stay in a hotel if you bought dinner there. Except the room turns out small and doesn’t have air-con.

People now scrutinize offers more carefully and are wiser to cheap offers like that. With the switch to postpaid there’s a growing appetite for plans that are sustainable. The appeal of a piece of junk that is outdated the day it comes out is fading fast. Instead, customers are thinking more long-term.

As customers become more demanding, I think there will be more room for creativity. They will want genuine value that delivers every day, such as rewards at their favorite cafes or the ability do more with their phone, from payments to controlling their package. Access to those things is tangible, and lasting, and that’s the kind of perk that makes sense when you’re in a lasting, monthly contract. In contrast, flashy introductory offers will get called out for what they are, smoke and mirrors.

Another change is the end of mass communications. Micro-segmentation means that niches like tourists or migrant labor can become important points of focus, even if they represent a small portion of the total customer base. You can expect to see more fights on those smaller battlegrounds. Online, too, we’re headed towards micro-segments, or even an audience of one. The packages we offer in your app are designed for you to match your lifestyle. There’s no one-size-fits all anymore._DSC1248Digitalization is a powerful tool in that respect. Even if you’re in physical store, should you, as a customer, have to explain how you use your phone and what your needs are? Shouldn’t telcos be able to better understand your usage data to make personalized recommendations? Sales people equipped with the power of digital recommendation algorithms will be able to better educate and advise customers.

All this is actually a return to core fundamentals. Why is this product good to you, the customer? How are we treating you? How transparent are we in working with you? The thing that’s new is the speed at which we must answer those questions, and the number of segments for which we must produce individualized responses. But the heart of any telco’s proposition will still be judged on value.

As a result of this focus on genuine value, every telco will have to rethink how they approach sales. At dtac, that has meant reshaping our sales group into a commercial group that integrates both the teams that create the offers and the teams that sell them. To work quickly, it’s no longer possible to separate those two functions. And it also means we can longer point fingers at one another if we don’t hit our targets.

That being said, I don’t lose sleep over targets. I used to work in IT. The target was 99.9% uptime per year. That means your systems could be down six minutes a year. When your phone rang, even if you were in the middle of a movie, you had to step out and take the call. In sales, things can look dramatic, but a good product will always sell. That’s why the game will be won by those who look their customers in the eyes, not those who are looking other their shoulder to see what their competitor is doing.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s