WiLL power

Reliance Infocomm's limited access phone service gets a mixed verdict

Reliance Infocomm officials say its CDMA mobile phone service has been a big success. Reliance India Mobile (RIM), they say, now accounts for 19 per cent of India's mobile phones with a subscriber base of 3.5 million.

Our Derby respondents are not so sure. Overall, it weighs in at number 13 in our overall rankings with 32 per cent voting it not successful.

But it can't be called a failure either because 48 per cent of respondents think it is "Somewhat successful".

Also, in our ranking among among successful brands, it comes in at number three overtaking Devdas.

But again, the results are not definitive. While 11 per cent of our 83 respondents put it in the top rank, 16 per cent place it in the top three ranks. To confuse matters more, RIM topped the stakes among those who listed it the least successful launch.

How can this discrepancy be explained? This is what a respondent has to say: "In terms of what they communicated and what the consumers actually got, there was clearly a difference."

He added that the tag-line "Karlo duniya mutthi mein" had become repetitive. "This was not a fresh marketing approach," he said.

The first issue that the company encountered was during the soft launch in December 2002. Schemes like the Dhirubhai Ambani Pioneer Offer attracted customers with an initial payment of Rs 3,000 for a connection.

The company also announced airtime rates of 40 paise a minute for STD calls to CDMA (also called wireless in local loop or WiLL) phones.

These were stunningly competitive against GSM operators who charged nearly 10 times more. RIM also offered value-added services free where competitors charged Rs 50 per service a month.

Reliance fattened the bait by offering discount coupons worth Rs 1 lakh for services like airlines, hotels, apparel, food and beverages.

Says Kaushik Roy, head marketing, Reliance Infocomm, "The approach was to acquire critical mass to start the business with the advertising having a sense of urgency."

To this end, the company declared the termination of the scheme in three months. This was supported by a multimedia campaign that played up Reliance patriarch, Dhirubhai Ambani's visionary ability and focused on the power of low STD rates.

The cricket world cup in early 2003 saw the campaign reach its apogee of which the ad showing Virender Sehwag hitting a winning six after talking to his mother proved a talking point.

The upshot off all this was that RIM acquired more than 1.5 lakh subscribers per month, roughly 30 per cent more than what new entrants in GSM services like Bharti Televentures had managed.

But early aberrations proved the sceptics right. For example, even as RIM started enrolling subscribers in January 2003, it didn't bill them till May 2003 because it wanted customers to get a feel of the product.

Then in May 2003, its free incoming call advantage was lost when all service providers were allowed to do the same. That levelled the field and customers began to benchmark quality of service against GSM operators.

Thus, while early RIM subscribers appreciated superior voice quality, other issues like the instrument over-heating during long conversations or difficulties in deciphering caller identification formats, dimmed the enthusiasm. And bad opinions always spread faster in new-tech businesses.

The company reacted by issuing full-page ads to bust myths about CDMA phones. In April 2003, it backed off and started focusing on its back-end systems.

"The simultaneous launch in 110 cities tested us and forced us to improve our back-end systems and service on a war footing," says Roy.

Marketing was also a sticking point. Reliance began selling connections with about 50,000 agents through unconventional outlets like textile showrooms "" piggybacking on Reliance's textile brand, Vimal.

This worked as long as it was supplemented with company showrooms that paid attention to standards set by the GSM operators "" airconditioned showrooms with uniformed staff and so on. Reliance did not have all this in the beginning.

Later, it established 125 company-owned Reliance Web World stores, also offering facilities like internet surfing, coffee shops and so on. The company also set up 100-odd franchisee-led retail outlets, some as large as 50,000 square feet.

But it needed to get in more subscribers to justify this cost. In July 2003, RIM hit the hoardings with a potent scheme. Called "Monsoon Hungama", it offered a CDMA phone with a Reliance connection at an initial payment of Rs 501 (nearly one-sixth of what subscribers initially paid for the service in the early days).

The remaining cost of the instrument could be repaid in instalments over 36 months.

With Monsoon Hungama, RIM managed to get 15 lakh subscribers in July 2003 "" 10 times more than what it managed in the early days. "It shook up the market," says Roy.

Reliance also renewed its communication to ads that focused on India's cultural diversity, showing the RIM phone as a uniting factor.

It roped in ad filmmaker, Bharat Bala "" recognised for his pan-Indian videos on national integration.

With a tag-line "Joys of RIM", Reliance is consciously moving away from being seen as a poor man's communication device. The question is whether customers will take the call.