- Currently has 2.96 mil postpaid customers, just 10,000 shy from the market leader Maxis
- In the midst of revamping its dealer hierarchy
Celcom Axiata Bhd chief executive officer Michael Kuehner (6th from left), deputy CEO Azwan Khan Osman Khan (7th from left), and the Celcom management team.
CELCOM Axiata Bhd, the country's third largest mobile operator in terms of subscriber base, believes that the worst is over and is all ready to regain its lost momentum this year.
The company also hopes to secure leadership position in the postpaid market -- a segment which once most thought was impossible.
"We hope to secure it (the leadership position) in the upcoming quarter during our next business update, but no promises," said Celcom chief executive officer Michael Kuehner during a media briefing in Kuala Lumpur yesterday.
The company launched its Celcom First postpaid plans in March last year and its postpaid business has been playing a vital role in cushioning the negative impact of its struggling prepaid business.
In 2016, Celcom's postpaid customer base grew by about 160,000 at 2.96 million. In contrast, prior to the launch of the postpaid plan, the company's postpaid subscriber base fell by 1,000 at 2.803 million in 2015.
Its new postpaid plans are also helping Celcom to catch up to arch-rival Maxis Bhd. In 2016, Maxis postpaid subscriber base fell by 160,000 at 2.97 million. A look at how the big three telcos performed in 2016 showed that Maxis is only commanding a 0.2 percentage point lead in the postpaid subscriber market share. (Maxis: 37%, Celcom: 36.8%, Digi: 26.2%)
"Our strategy for our postpaid, and prepaid, is to have a simple, easy-to-understand offering. That is working pretty well. The postpaid momentum is strong," said deputy chief executive officer Azwan Khan Osman Khan.
Azwan added that there will be some changes made to its postpaid offering in 2017, but the changes won't be radical.
"I don't see us relaunching something redically different in postpaid. However, there will be a few tweaks over the course of the year," said Azwan.
Today, about half of Celcom's postpaid customers are on the new plans such as Celcom First Blue, First Gold, First Gold Plus, First Platinum, and others.
Fixing prepaid... one step at a time
While its postpaid business is gaining good traction, the company's prepaid business remain a concern for investors and industry observers.
Celcom, a wholly-owned entity of publicly-listed Axiata Group Bhd, was at one point in time the market leader in the prepaid segment. Today, it hold the smallest market share among the incumbents.
The company said that the decline was mainly driven by two factors: the lack of strong product/ offerings, and the lack of support from its distributors.
In December last year, the company launched its brand new prepaid plan -- whereby users will get free basic internet and surfing on Facebook. Users can then purchase the Internet plans that suit them (daily, weekly or monthly plans).
According to Azwan (pic above), the new prepaid plan has gained good response from the market, as the product is simple and easy to understand.
However, solving one part of the equation is not enough to regain the lost prepaid momentum.
"The whole prepaid market is really a dealer-distributor market. We had some issues with dealer trade confidence, as a result of the IT issues we had a few years ago. That trade confidence does not change overnight.
"It is a bit of a chicken and egg situation. You got to have a good product in the market, then you have to market it to the consumers, and then you need the trade pushing it.
"That entire cycle really needs to kick in, and it takes time. It is a lot more difficult than postpaid, where you control the channels," said Azwan.
Currently, Celcom is in the midst of revamping its dealer hierarchy -- whereby it will be more transparent in the way it rewards its dealers.
"You will also find that in the next three to four months a complete revamp of the visual, signage of the dealers. It should be a lot more visible then.
"We are also introducing dealer automation, and other initiatives that can help us to become the preferred telco," said Azwan.
Nevertheless, Azwan declined to give a timeline on when the entire dealer-revamp exercise will complete.
"We hope to see some results in first half, but it is a long process," he added.
He also added that the company plans to increase the number of dealers in the market, however, it will be done in a careful manner.
"The intent is to increase the number of active dealers, but the intent is also to streamline a bit more between postpaid and prepaid, and to be a bit more clear on which (hierarchy) dealers gets what type of benefits."
Plans for this year
This year, the company expects the industry to experience a flattish revenue growth. It also has a capital expenditure (capex) plan of RM1.4 billion this year.
Besides the dealer-revamp programme, Kuehner said that Celcom will also be focusing on other areas like: building the best data network, digitalisation, to offer personalised customer experience by leveraging on data science and analytics, and others.
"We want to give our customers the best video experience," said Kuehner (pic above). Today, about 70% of Celcom's customer data consumption is on video content.
Kuehner believed that by focusing on improving customer experience and network experience, it will be a matter of time before the company catches up to its competitors.
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