Maintaining and developing quality-oriented customers
Maintaining and developing quality-oriented customers
Almost two years of economic crisis have not stopped the
growth and development of Indonesia's cellular phone operators,
particularly GSM. With prepaid SIM cards, GSM operators have been
able to tap into the changing behavior of crisis-wary consumers
who are limiting their pulse usage. The prepaid SIM card has
become popular because of its advantage in being able to monitor
and limit pulse usage.
But like businesses in any era, GSM operators not only
encounter customers concerned with the benefits available to them
and price, but also those people, better known as quality-
oriented customers, who place more emphasis on quality than cost.
Not all GSM operators have focused on the latter group during
the crisis. Before the crisis, their number was smaller than
those consumers concerned with both quality and price, or looked
for price over quality. The crisis, with its harsh impact on
consumer spending power, further reduced the number of quality-
oriented customers.
Their number may be smaller, but quality-oriented customers
should receive greater attention because they are likely to be
loyal. Their main concern is not price but quality, and their
loyalty should be won with quality products and superior service.
Initially, the objective to serve quality-oriented customers
was not an easy task for Excelomindo Pratama (XL), the GSM
operator most concerned with this group.
As the newest face in the GSM market, XL did not have to be
concerned with educating the market. Yet XL quickly gained a
response from customers and prospective customers that was far
beyond expectations, despite the fact XL prepared its system and
infrastructure according to predictions of customer numbers.
XL's emergence in the wake of other operators, partly due to
its efforts to install a better infrastructure, inevitably
created a more conducive starting point for its debut, making
quality its point of differentiation with other operators.
Why quality? Because this aspect received insufficient
attention from the market's predecessors, which were more focused
on educating the market. While XL started out with a range not as
wide as its competitors, and relatively higher fees, the market
accommodated its entry. Its SIM GSM card, with its advertising
slogan Langsung Kring (Starts Ringing Instantly), quickly made
its voice heard in the market.
XL's guarantee of quality covers two aspects: service quality
and communications quality. Service quality: XL's Customer
Service Staff (CS) are trained not only to give answers to
questions, but to take the initiative in offering solutions to
cellular subscribers' problems.
XL is the only cellular operator to use Fiber Optics in Java,
Bali and Lombok. Fiber Optic's transmission communication quality
is considered clearer and faster than microwave frequency. XL
also installed Microcell XL in Jakarta's communication-heavy
Golden Triangle: Jl. Sudirman, Kuningan and Jl. Thamrin. Use of
Microcell XL increases network channels and minimalizes the
general customer complaint of "No Network" or "Network Busy".
Of course, at the outset, XL offered better service and
communication quality for all its customers, regardless of
whether they were frequent or infrequent users. However, after a
sufficiently satisfying response, it decided it needed to show
more appreciation to its frequent users. This came as the crisis
began to strike Indonesia.
As we are all aware, the worst crisis in Indonesia in the past
30 years has caused changes in customer behavior. Many customers
suddenly began calculating price versus quality, or price value.
The drastic change in consumer behavior put businesses on notice
that they would have to develop an outreach which was suited to
customers' needs, wants and expectations.
With quality oriented-customers, businesses have taken the
approach known as "romancing the brand". This includes providing
content and context differentiation which is equal to or better
than prior to the crisis. For value-oriented customers, companies
have been forced to embark on "rationalizing the brand", which
entails offering the same content differentiation but reducing
context differentiation.
To price-oriented customers, "economizing the brand" is the
necessary approach, characterized by lowering content and context
differentiation offered to customers (see Figure 1).
Outreach to customers does not only identify differentiation,
but also nine core marketing elements. This is why XL set out to
offer service with greater benefits for its quality-oriented
customers, instead of offering added-benefit service for a higher
price. The process remained quality focused (see Figure 2).
Subscribers identified as quality-oriented customers receive
appreciation based on the number of phone pulse units they use.
Initially, XL offered discounts to certain businesses, but it now
applies to all quality-oriented customers. Among them are the
creme de la creme: the very heavy users.
In implementing Treachy and Wieserma's recommendations in The
Discipline of Market Leaders, XL developed special customer
outreach to these exclusive customers. It introduced Customer
Relations Officers (CRO) to serve the needs of the customers. For
instance, XL CROs can assist in airport check-in or gain access
for economy-ticket holding passengers to use executive lounges at
airports.
Why does XL go to all the trouble? Quality-oriented customers
need a product with an extra package, which also takes the form
of a loyalty program.
How has the outreach fared? XL has managed to ensure that the
number of its quality-oriented customers has not dwindled, a
reason in itself for a sense of achievement. It is even more
satisfying when we consider that most cell phone users today have
a preference for prepaid GSM SIM cards, which do not foster a
closer relationship between an operator and its customer.