 "Rajeev Sethi")
Relatively new in the sector, the Indian arm of the Norway-based Uninor is in a happy place. The company recently broke even in two circles – UP West and Bihar-Jharkhand. With this, the company has achieved break-even in a total of five out of its six circles. Despite its commitment to break even within three years of its operations, the company has some of the most value-for-money plans in the market today. Rajeev Sethi, Chief Marketing Officer, Uninor, on how the company has achieved this. Edited excerpts from an interview.
In as competitive a market as Indian telecom, it can't be easy to make a mark for yourself, especially if you are a new entrant. What has held Uninor in good stead in terms of marketing initiatives?
For us, it’s all about focus. It’s about making choices on what we will do and more importantly, what we won’t. Uninor chose to be a mass market operator – to focus on basic services and only pre-paid subscribers. This meant no 3G or 4G or complicated value-added services.
We took this strategy to market with a three-pronged approach -- to be the best in basic services, to be the best in mass market distribution and to be the best in low cost operations. Towards customers, we offer one simple and unambiguous commitment – Uninor will be the most affordable in tariffs. We call this “Sabse Sasta”. This strategy and a focus on who our customer is and what she really wants have helped us take a good position in the market.
What about the network? With a lot of emphasis on wireless network, what are some of the steps the company is taking to stay in the game?
Uninor is about continuous improvement. This means we aim to be better each week and month – in our retail presence and our network coverage. We are continuously expanding our network footprint and, in fact, are now going into smaller towns and villages with a population of less than 5,000 with our “Sabse Sasta” services.
You are credited with establishing Uninor as the most affordable mobile operator. How did you manage to pull that off, while also keeping an eye on the balance sheet?
While we have made a commitment to be the most affordable operator – sometimes upto 50 per cent cheaper than any other, we have also made a commitment to our shareholders and the financial stakeholders of a record EBITDA break-even within three years of operations.
This means that Uninor needs to have an ability to be as much lower in its cost as it is in its tariffs. In our estimate, our cost per minute is now as much as 30 per cent lower than that of incumbents. The proof of this lies in the results. While offering the cheapest tariffs, focusing only on basic services for the mass market and operating in non-metro circles, Uninor has achieved its break-even in five of the six circles it operates in.
As one of the challengers in the telecom sector, where do you see the company in terms of market penetration in the next couple of years?
There is still a long way to go in terms of basic penetration. Considering that almost half the market is on dual SIM phones, the real tele-density in India is much lower than what it appears to be. Now and for the foreseeable future, basic services such as voice, SMS and basic internet will continue to be the mainstay.
The point of sales for the company has extended beyond brick-and-mortar stores to milkmen, auto drivers and so on. How has this helped the company? Was this step taken after some study or research?
Such initiatives again result from the choice we make at the top – of being a mass market operator. Once we do so, we take initiatives that bring us closer to the mass market consumer than other operators. If a mass market mobile user commutes by auto-rickshaws, we see no reason why a recharge or a new connection should not be available to her right there. The same approach is reflected in enlisting milkmen or newspaper vendors to take Uninor and its products into households.
We have been able to conduct significant business through these channels and in the process, taken the Uninor brand and its Sabse Sasta promise right into the everyday lives of our customers.
Despite being one of the fastest-growing telecom markets in the world, there is a lot of catching up we need to do when it comes to technological advances. Do you agree? What are some of the newer technologies you wish came to India soon?
There is no doubt that data will be a strong phenomenon in the years to come. Here again, however, we aim to bust a prevalent myth that data means 3G. We believe in the mass market philosophy. The bulk of the market consuming data today does so to access social networking sites, browse the internet, check mails and chat with friends. None of this needs 3G and all of this needs more affordable tariffs. This is where Uninor focuses – taking mass market data to our mass market pre-paid consumers with the most affordable tariffs.
