Tuesday, February 9, 2016

Reading the Landscape, Guessing the Future Mobile Business Model in Indonesia (Part 3)

Indonesia mobile landscape and its today driving force

Indonesia has reached saturated mobile penetration and shrinking market. Not a matter of price is a major factor, but rather to the customer experience and new experience, e.g. data and internet. There are the battle fields that the players can differentiate themselves, not just selling a commodity which only the voice, sms and data, but also customer experience. In general, worldwide trend is moving towards data communications and Internet, communication is not just "halo-halo" anymore. Internet is the way to go, with high demands towards experience in all aspects, browsing, Internet, content, and all new experiences. Likewise in Indonesia, because broadband penetration is still low (32% of total mobile subscribers according to data from We Are Social in 2013). This business has been shifting toward "the next evolution of talking business", i.e. Internet and data. Talking of data becomes irrelevant when just looking to the price sensitivity, but rather the customer experience. For example, memorizing MSISDN was considered not too important, because with chat applications such as BBM, whatsapp, do not require such an identity number.
Although voice and SMS service as current business are still the largest contribution, but their growths has stagnated and tends to decline. Global experts and practitioners have predicted that mobile growth will be minus single digit in the next few years, while data services growth will grow in double digits, reaching more than 20 to 30 percent in some carriers, even already happened more than 40 percent in developed countries. Hence, we will see market real signals from that is going to a disruptive shifting. Customers who are already using a smartphone will shift their mobile services consumption behavior. At least these following 3 shifting is happening, i.e. (1) Increasing usage, ARPU increased by at least 20 to 30 percent. And on average, 50% up than normal usage or before using a smartphone. (2) No  more longer simply usage of voice and SMS only, but increase the usage frequent. It could be persistent usage of telephone and SMS, and data usage is increasing, or even all services usage are increasing. (3) Users who are already using a smartphone will not go back or downgrade to use the old phones which only have the basic service.
Mobile consumer will be more powerful than today. Numerous disruptive technology such as smartphones have changed the way using products and services. Digital consumer empowerment has created a level of personalization that has significant implications for strategy, customer interaction and selection of innovation provider in mobile industry. Consumers are looking for innovation and pleasure in everything from smartphones. There are also indicators of a strong market for new device categories such as phablets, health and fitness devices and other technologies. In short, now is the time for service providers to aggressively invest in product innovation. In doing so, the service provider must consider how the new product will interact with customers in all aspects of digital and new value-added proposition in its digital life. With all kinds of small objects that are equipped with modules that are connected to the Internet, the customer can quickly race toward full digital lifestyle. The high consumer interest to meet the digital lifestyle is abundant opportunities for technology providers and mobile operators. However, to obtain and secure a place in this economic constellation, it requires a very sophisticated knowledge in defining customer segments. MNOs need to understand how customers use every device in his life, how to build relationships with customers and how to attract new products can be introduced to meet customer needs.
In recognizing and defining customer segments, refers to Accenture survey released a couple years ago, it was identified how was the consumer behavior per segments that can be targeted into potential customers of new devices and services, i.e. (1) The early adopters who said "I want to have the latest products and services and became the first in the group to have it". (2) The early majority who said "Normally I became one of the first to try and buy new products and services". (3) The last majority who said "I want to buy new products and services but often wait for others to try it out first." (4) The last adopters who said "I usually wait until the majority of people have started using a new product or service, and be able to know what goodness beforehand." 18 percent indicating respondents are early adopters and an additional 17 percent identified themselves as the early majority. MNOs can create an effective satisfaction degree to its all customers segments by managing these segments.

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