MNP effect: Telcos battle to retain customers

Written by Nikita Upadhyay | Nikita Upadhyay | Mumbai | Updated: Feb 25 2011, 05:09am hrs
Suhas Sharma, a software engineer, is a happy man. His mobile service provider has offered him unlimited browsing for free, a Rs 50 waiver on his monthly bill, 500 minutes of free talktime and 500 free sms (instead of 150 minutes and 150 sms, earlier) for the next three months. No, he didn't ask the company to change his tariff plan. All he did was to text the phone company on the number 1900, indicating he wanted to switch his operator, while retaining his number, under whats not been popularly called mobile number portability (MNP ).

Its not just Sharma, but thousands of others who are being lured by their existing service providers as subscribers look to switch operators for a host of reasons be it poor network, faulty billings or lacklustre customer service. Operators are particularly reaching out to their high average revenue per user (arpu) consumers, giving them targeted and tailor-made product offerings. Hemant Joshi, partner, Deloitte Haskins & Sells, said only 4% of the entire post-paid subscriber base in India are high arpu customers. Offering such plans might impact telcos margins, but retaining high end customers will be positive for them in the long run. It's a retention war now, says he.

Neeta Solanki, a fashion designer, has received a three-month rental waiver. I had put in a port out request owing to issues with the network, and the customer service representative was quick to offer me this scheme, she said.

A media executive, who put in a request to switch from his operator owing to frequent call drops, was given an assurance that 3G is being implemented, all network issues will be rectified soon.

If the subscriber was still not convinced, he could visit the nearest service centre and have his SIM card replaced for free, to begin with.

Loop Mobile, which has a legacy of high arpu and corporate customers, has introduced a loyalty program which brings a host of exclusive offers from a wide range of holiday, shopping, dining, lifestyle and entertainment suiting their preferences. For corporates and SMEs, we have recently introduced a few aggressive plans under rental Rs 99, Rs 199, Rs 399 and Rs 599 with unlimited mobile internet, innovative VAS free for a year and free minutes which can be carried forward, and bundled Blackberry services, said Surya Mahadevan, COO, Loop Mobile.

Another operator, who did not wish to be identified, said that the focus is on the nature and quality of customers. Customers, who make timely bill payment and are high arpu generating, are offered specific tariffs to suit their needs," the company said.

Sanjay Kasturia, VP, Syniverse Technologies, a company which has implemented MNP in some zones in India, said that the highest churn is among prepaid subscribers.

We are also seeing a shift from CDMA to GSM platforms in the Indian market. We will have to see if this trend continues over time. A clearer picture will emerge after about three to six months, he said.

Rajiv Bawa, executive vice-president, corporate affairs, Uninor said, Customer retention isnt something we are learning now, since we are only in the pre-paid category. So, for us, a unique product like dynamic pricing where customers get upto 60% location and time based discounts on all calls is still unique and attractive for current and potential customers.