Rivals share stage, expound strategy

Rivals share stage, expound strategy
The Nation (26 October 2007)

Given their aggressive strategies to win customers, bosses of Advanced Info Service (AIS) and Total Access Communication (DTAC) were expected to launch a sword fight when they faced each other yesterday. Instead, at a special talk hosted by newspaper Prachachart Turakij where the telecom rivals shared the same stage for the first time in history, they shared amusing stories, spoke about their weak points and outlined their plans for the saturation age in the mobile-phone industry. Eventually, they admitted that despite cut-throat competition, they do not intend to kill one another. DTAC admitted that having fewer subscribers forced it to adopt an "underdog strategy". "In the past, we always lost to AIS. Then we kept following what AIS did and announced in newspapers, and we offered the same thing at a price 15 per cent lower," Thana Tienachariya, DTAC's chief commercial officer, said with a big laugh. DTAC now realises that strategy will not work as long as its network coverage is a weak point. That's why 100 executives joined a 10-kilometre run for 90 minutes to prove that it could accomplish any "impossible races" - including a network improvement to please customers. AIS has also been under pressure. Its organisation has been the leader since inception and there is inertia among employees. "Our employees are not as alert to new things as those at DTAC. The inertia could lead to disaster. We need to admit that we're moving so slowly and we need to revive the lost energy. This will take time and some jobs will be cut. Hopefully, DTAC will take care of these employees," AIS president Wichian Mektrakarn quipped. AIS attributes its success partially to having superstars as presenters and, according to chief commercial officer Sanchai Tiewprasertkul, the strategy has worked well in winning over clients across the country. Ketchayong Skowratananont, DTAC's prepaid business division head, admitted that superstars were also once the company's focus but it could never complete against AIS in this regard. Thus, laymen are in its advertising campaign. In a way, this helps differentiate the brand. Both parties agree competition will be fiercer when the mobile-phone market reaches saturation point next year. Operators will need to secure existing customers and woo new ones. While AIS has launched an excellence campaign to please its 25 million subscribers, DTAC's strategy will focus on keeping existing subscribers and acquiring new users. On Wednesday, DTAC announced a rebranding aimed at ensuring it will be the most admired brand next year. Sanchai of AIS was undeterred, saying rebranding was common for old brands. However, he quipped that not all brands need such strategy, like soap products Lux or Tabasco sauce. "AIS has no strategy to change or rebrand because we believe that we are in a strong position," Sanchai said. While fighting against each other, the rivals are also alert of what the third player - True Move - is doing. Both AIS and DTAC agree they are weak in the pre-teen segment, where True Move is active. They realise their brands may be too old for this sector but are trying to capture this market, for these kids are growing up and are their potential clients in the future. "Still, at this hour, the kids are wise to choose the cheapest services and they are not the source of income for telecom operators. Therefore, right now, anyone with a dominant share in this segment tends to lose," Thana laughed. Being number one also draws attention, Wichian admitted. AIS suffered hugely when Temasek Holdings took over its parent company Shin Corp and led many anti-Thaksin Shinawatra customers to drop their subscriptions. DTAC has also suffered from huge debts caused by the baht's devaluation. "Without the debts, DTAC may not have been this strong," Thana said. "We have suffered several crises, mostly when we thought that the market was stable or that we had secured a good place. Now we know that we can't have that kind of thinking. We have to realise that we must go forward, whether we or the market are stable. This leads us to rebranding to motivate employees." Both sides agree that it wouldn't be in anyone's interests if one dies because of aggressive competition or if they are merged. "We need competition. The market will expand if all players are growing," Thana said. Wichian was in agreement. "When we create a brand, it is for different segments. Now we are securing the top and bottom, but we leave a gap for our competitors. Without competition, it's not good."