Case Study : The failed case of Idea Cellular yearly plans as a retention strategy

Who doesn’t want to retain a customer? Of course in telecom field customer is the core element. Make a happy, satisfied and loyal customer and watch your company’s success grow by word of mouth every day. So, every operator needs customers who are committed to paying fixed monthly rentals. It should also be noted that customers continue to be in that segment of users only when they are satisfied with the services too. Now, I will come directly to the topic, in the current situation of intense competition every operator has tried and been trying their best to retain value customers. No offense, operators tried playing the retention game with bundled benefits, discounts, extra benefits which are quite a few to name.

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I have a keen eye for every minute detail on almost all the operators but one operator’s strategy caught my attention i.e. Idea Cellular. I can (if possibly allowed to) call it as an impulsive attempt of failure in retention. Since I don’t have the statistical data I am assuming it the consumer-centric way.

Problem Statement : Retain a postpaid customer, at least in the current period till the situation stabilizes.
Solution adapted (at least from what I can figure out) : Offer yearly plans of the same plans (benefits) with the same price tags billed yearly where a customer needs to pay the complete yearly payment of the total amount in the next bill cycle.

Example : Let us take a monthly rental plan of 499 with benefits as per the plan. So, any consumer needs to pay 499 + 15% ST in case of usage within bundled benefits.
So, Rs. 499 + Rs. 74.85 = Rs. 573.85 is what a consumer needs to pay monthly.
So, Idea had come up with this yearly offer for the same plan. There are other yearly plans in different price slabs as well.