Tackling the Dual-SIM Threat

With mobile customers constantly roaming around the global village, it is tempting to think that operators around the world are all facing the exact same challenges in terms of retaining customers, as the prepaid market is notorious for high-churn rates. However, our customer base tells a very different story, as mobile operators worldwide face challenges unique to their own markets.

Mobile phone users no longer need to carry around more than one mobile phone, since mobile manufacturers have created ingenious phones that are able to handle more than one SIM at any given time. For example, Samsung has recently announced a multi-SIM phone, in which case both SIMs are active simultaneously. This means that if a user is talking to someone on the first SIM and gets a call on the second SIM, they will be able to see who is calling and can accept the call on the second SIM.

New headaches
This, of course, presents new headaches for mobile operators, as the challenge now is to retain customers on a ‘full time’ basis. The customers are not necessarily going away, and thus churning in the real sense of the word, but they become dormant for periods of time when they are utilising a competitive mobile network.

One of the markets in which we have seen the popularity of dual-SIM phones rise is Russia, which boasts the largest mobile market in Central and Eastern Europe, and is still growing fast. In May 2009, the total number of subscribers in Russia reached 194.7m, with customers being wooed by the three major service providers – MTS, VimpelCom and MegaFon. Meanwhile, the competition is intensifying, with the increasing number of multiple-SIM ownerships.

The legal framework in Russia has created a market where there are more pre-paid customers than those on contract. Further, most users have dual-SIM handsets, where both SIMs are live and users decide before each call which one to use. As the majority of handsets are not bought through the operators, but from independent stores, Russian mobile operators are not able to lock handsets to their networks, and as a result, customers are able to benefit from switching between different operators’ SIMs on a daily basis.

The power thus lies with the subscriber, making it extremely difficult for the mobile operators to lock in customer loyalty, as customers receive multiple offers from different mobile operators and are able to choose which offer to use. This practice is intensifying the fierce competition between providers, as they are forced to offer attractive call rates in order to discourage users from switching to the second SIM for roaming or domestic calls.

According to InternetWorldStats, mobile SIM card penetration in Russia has surpassed 100 per cent, while actual mobile user penetration is lower. For example, at the end of May 2009 SIM cards in use in St. Petersburg showed 174 per 100 inhabitants, while in Moscow there were as many as 195 per 100 inhabitants. 

Tackling dual-SIM usage
The key element in tackling dual-SIM usage is the ability to perform advanced analysis of customer behaviour to identify where a user may hold another SIM for specific types of calls. For example, usage of a SIM for limited phone numbers might indicate that the user has a SIM for personal use, and another SIM for work purposes. Other indicators could be destination changes, such as off-net and on-net usage patterns, silent periods during the day, or balance rates.

With Pontis’s marketing knowhow and expert analysis, mobile operators can identify real-time usage patterns and balance rates based on personal behavioural attributes. Once a baseline analysis process is established, the aim is to track the purchase of a secondary SIM as soon as possible with the ‘Secondary SIM Tracker’.

This is done by identifying the monthly average calls distribution and variance for each customer; measuring the distribution of calls on a weekly basis and tracking changes. If you see a high incidence, and consistent increase of on-net calls, plus a decrease in total calls, this might indicate a secondary SIM purchase.
Using this data, Pontis enables service providers to offer real-time personalised and contextual price and product offers. The solution enables providers to win back a dual-SIM holder’s share of wallet by “blurring” their price perception. This can be done in two ways. Firstly, by offering long-term, flat rate tariff plans, or short-term incentives such as discounts on off-net calls when making X minutes of on-net calls.

As all operators provide similar plans, it is important to encourage customers to stay active by providing a relevant and personalised offer which incentivises them to move to a relevant price plan and as a result prevent “temporal churn”. These offers are fulfilled automatically by our platform, which allows a quick follow-up with attractive offers and, consequently, achieves higher response rates.
Using the above process, our platform allows mobile operators to follow the behaviour of their entire customer base on an individual basis, while constantly verifying the response rates in order to fine-tune personal offers and ensure customer satisfaction. With the trend towards dual-SIM ownership spreading, the need for this type of solution is only going to increase.

Michal Samuels is marketing manager at Pontis