Reliance Mobile, the country’s second largest Mobile Services Operator, all set to revamps the existing monthly subscription pricing model of the Vale Added Services like caller tunes, internet browsing and others. The company is ready to launch its all VAS at Rs.1 per day, the new pricing model instead of the monthly subscription.
The biggest beneficiaries of the sachet pricing plan would be prepaid subscribers, who account for nearly 85% of RCom’s GSM and CDMA Mobile subscriber base.
RCOM is overhauling its pricing model to offer value-added services (VAS) such as caller tunes, news alerts and Internet surfing for as low as Re1 a day, rather than for a monthly subscription.
“We are rolling out this sachet pricing by this month. We have already tested the sachet pricing prospects with gaming,” said Krishna Durbha, business and marketing head, VAS.
RCom hopes to reach a wider audience for its VAS by offering customers more price flexibility in using the services.The company expects 15-20% of its revenue to come from VAS and data services over the next three year. RCom now plans to roll out a series of initiatives including live streaming of cricket matches and Formula One car races as well on mobile phones, . Subscribers can opt for sachet or consolidated payments for these services.
India’s Mobile Operators typically earn 9-12% of their revenues from VAS and data services, according to a telecom analyst with a domestic brokerage, who declined being named. In countries such as Japan and Korea, VAS contributes as much as 30% to a cellphone operator’s total revenues.
Sachet marketing started transforming sales strategies in India some three decades ago.In the 1980, Chennai-based Cavinkare Pvt. Ltd launched its Chik shampoo brand in sachets for 50 paise and Re1, making it easier for consumers to buy these branded products.The strategy paid off and forced other companies in the sector to follow suit, but sachet marketing has largely been restricted to consumer goods.
Among cellphone operators, Vodafone Essar Ltd was the first to sell ultra low-cost products when it launched micro top-up cards costing Rs10 each for its prepaid customers.