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Home  » Business » Vodafone's branded plan brings post-paid focus

Vodafone's branded plan brings post-paid focus

By Sayantani Kar
September 12, 2014 12:33 IST
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A Vodafone storeTelecom brands are finally giving post-paid consumers their place in the sun.

Forming less than six per cent of the total subscriber base but contributing up to 25 per cent of total revenues, post-paid customers have seen offers targeted at them only over the last one and a half years.

There is also the looming threat of both RJio (pan India) and Airtel (some circles) rolling out 4G data service.

Vodafone is the latest to focus on the post-paid sector, launching its flagship branded product called Vodafone Red.

While it is late to the party, it will back it up with a full-fledged campaign spanning all available media.

Vodafone Red had been rolled out in the first week of August and it broke the campaign two days back.

It has got a bundle of products (see box), out of which three would be highlighted in the campaign.

However, competition like Airtel and Reliance Communcations had launched similar plans earlier.

Airtel advertised its My Plan in 2013, saying that it was looking at flexible tariff plans to move pre-paid customers to post-paid schemes (see box).

After all, prepaid customers return low ARPUs average revenue per user and comprise over 94 per cent of the mobile subscriber base.

RCom  launched an all-share post-paid plan in October, 2012, to allow sharing of voice, data and SMS services across devices on a single bill within a group (see box).

These operators, including Vodafone, have similar plans for businesses too.

Shobhit Khare, VP, research, Motilal Oswal Securities, says, “Since the last one and a half years, operators are focusing on quality rather than quantity.

Thus, converting pre-paid customers to post-paid or getting post-paid customers from competition are priorities now.”

Ronita Mitra, senior vice-president, brand and consumer insights, Vodafone India, explains the need for Vodafone Red: “The category of post-paid has always operated on plans.

"So, we felt the need to move beyond, to a comprehensive product so that the customer does not have to interact with different aspects of Vodafone.

"These would be high-value customers.”

While Red is an international concept, it has been informed by the pilot, run earlier this year in Maharashtra and Goa.

Mitra says, “As a bundle, Red was seen as very convenient and because we are launching it after other markets, we have the benefit of bringing in the best practices.”

Campaign execution

Vodafone Red is this year’s integrated solutions product that the company would highlight.

Every year, Vodafone uses its iconic mascots, the Zoozoos to advertise during the Indian Premier League.

However, Mitra says that Zoozoos make sense when there are multiple messages to be delivered, especially during an event with such a large captive audience as the IPL.

The lovable pug, on the other hand, would be brought in to talk  about its network.

Rajiv Rao, national creative director, Ogilvy & Mather, who has been spearheading the campaigns for years, says, “There is no pressure to fit in a mascot.

"The imagery has to do justice to the brief. Here it was to launch a special product, so it had to be a whole new world.”

Hence, the ads set in a quaint village (shot in Spain) with quirky but happy characters.

SHARING POST-PAID JOY

VODAFONE RED
  • Four tariffs with a bundle of features: Combo plans (data, minutes, SMS all in one); pool & share of the all the plans of a family (alleviates monthly limits); relationship manager (for subscribers of the plans worth Rs 1,299 onwards); added devices for sharing the allowances; safety apps (for parents to monitor kids); tie-up with Payback to redeem points for Vodafone Red bill.
AIRTEL MY PLAN
  • Rather than preset plans that might not get fully utilised, lets users, in three steps, opt for free packs along with a rental plan, that can also be changed once a month for free. Reduces the complexity in choosing a post-paid plan to convert pre-paid users.
RCOM ALL SHARE POSTPAID
  • One bill for a group or family on a single rental plan, that lets members share voice, data and SMS. Prevents members from exceeding their monthly limits due to pooled resources

The Zoozoos which had been used to launch Vodafone’s 3G services earlier was not brought in also because of the scale of the campaign.

“The production cost and effort lend themselves to a series of 10-15 short-duration films, rather than just three films,” says Rao. Maxus, of Group M, will handle the media duties.

Jio effect

Analysts also point out that the post-paid focus is not just to increase profitability but also to prepare against 4G offerings from the likes of Reliance Jio Infocomm (RJio).

“Once it launches in 2015, RJio’s first target would be the high ARPU customers in the top 10-12 cities.

Plans such as Airtel’s My Plan and Vodafone Red are also meant to keep the customer from feeling that she should migrate only for the data advantage.”

Post-paid count

Last quarter, Vodafone had reported a post-paid ARPU of Rs 672 (and pre-paid Rs 160) and claims a post-paid base of 11 million out of its 170 million subscribers (6.4 per cent).

Airtel’s post-paid customers number around 10.6 million according to analysts’ estimates.


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Sayantani Kar in Mumbai
Source: source
 

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