Philippine telcos need to get personal with customers amid rising competition

Competition in the Philippines’ telecom industry has intensified due to continuous technological innovations and new players entering the market.

“This has spurred major telco players to explore areas of growth over and beyond the core business of call and text services,” said Ma. Yolanda Crisanto, head of corporate communications at Globe Telecom. “Broadband and data are what will drive continuous growth and business momentum.”

Globe is one of two major players in the market, which is dominated by Smart Communications, a subsidiary of the Philippine Long Distance Telephone Company.

In November, the Philippine conglomerate San Miguel Corporation also announced its plan to enter into the telecom space by launching mobile-phone service next year, following ABS-CBN, a multimedia company that entered into a network sharing agreement with Globe for its entry into the market in May.

Having more players in the market is good news for consumers, as the competition will generate more offers and better pricing. “It prevents complacency among the major players and gives the consumers more options,” said Alex Syfu, partner and chief relations officer at DDB DM9 JaymeSyfu.

He pointed out that pricing is the major factor in securing a brand’s market position in the Philippines, where sachet-marketing is prevalent. However, subscribers are becoming more demanding about the quality of service telcos provide.

The Philippines has one of the lowest smartphone penetrations (15 per cent) among the Asian countries, according to Nielsen’s ‘Decoding the Asian Mobile Consumer’ study in September, but there are growing use of smartphones as well as burgeoning requirement for mobile browsing amid increasing popularity of social-networking sites among Filipinos, said Crisanto.

While television is still the most popular media channel to announce product news, digital is gaining more importance. This has also provided telco brands multiple touchpoints to make their products and services more relevant.

“We are now seeing aggressive efforts toward the use of non-traditional advertising spaces, especially digital platforms, amongst the key players,” Syfu said. “It’s the time for telco brands to innovate beyond technology, as well as review and implement convergence strategies among media and communication partners.”

For example, Globe Telecom is expanding its retail network and customer touchpoints to reach its subscribers, as well as maximising the use of social-media channels, such as Facebook and Twitter, to engage 24/7 by answering queries and hearing feedback.

However, customer service and satisfaction is always the major challenge for telcos. With service offerings that are almost the same, consumers tend to stay with the brand that will be responsive to their needs. A price war is only a short-term business strategy to keep customers and attract new ones.

“Brands have to engage their subscribers on a personal level to guarantee loyalty,” Syfu said. “It's crucial that telco operators touch them in relevant ways, so they will become an extension of customers’ lives, allowing them to live it better, rather than just a service or a company that sells a product.”

Smart Communications worked with DM9 to introduce Smart TXTBKS, a project that employed old analog mobile phones, which most families own, in order to ease the backpack burden of young students by transforming their textbooks into text messages. 

It’s also essential for telcos to keep changing and innovating with the times. Recently, Smart has successfully tested its video multicast on LTE connectivity, which will allow users to watch clear, lag-free live videos on their LTE-capable smartphones and tablets.

Globe is also beefing up its mobile data product portfolio in 2014 to allow its subscribers to connect with their loved ones and social circles not only in the country, but around the world.

“Innovation will result in aggressive competition, which is beneficial for consumers,” Syfu said. “Continue evolving, but make it fast because the consumers won't wait for you.”