In a market with nine operators, connecting with would-be mobile users in the Kingdom is a costly process that has pushed firms to become ever more creative in attempting to sell SIMs
POP stars don’t generally enjoy a reputation for rising early, but at 9am on Friday morning, a group of Cambodian chart toppers – including Meas Sok Sophea, Preap Sovath and Keo Vasna – sat in the VIP Lounge of Smart Mobile’s flagship Monivong Boulevard showroom, wide awake and ready for the cameras.
Within the hour they were delivering speeches on the importance of positive role models in keeping the Kingdom’s young people away from drugs.
The occasion was a press conference announcing a series of free, anti-drugs themed concerts in Phnom Penh over the three days of the coming Water Festival, sponsored by Smart Mobile.
Speaking at the event, the firm’s CEO, Thomas Hundt, said the concerts reflected a “commitment to being a company with a highly positive attentiveness to, and contribution to, Cambodian society”.
Moments later, Hundt added that “Smart Mobile is looking forward to welcoming visitors to Phnom Penh [for the Water Festival], especially the huge crowd of youth Smart Mobile serves in the provinces”.
The promise of this crowd – not only the teenage consumers entering the mobile market, but every one of the increasingly well-employed, well-educated participants in the new, “young”, up-and-coming Cambodia – has already drawn nine mobile-phone companies into fierce competition over what remains a narrow market.
This saturation has spurred a marketing frenzy among operators.
Among the top 10 advertisers in print media for the first eight months of the year, seven were mobile-phone companies, according to data from Indochina Research. In 2008, mobile-service providers occupied the top four positions, and up to the end of August this year, the sector claimed six of the top 10 positions in terms of spending on television advertising.
Moscow-based Beeline has also co-opted tuk-tuk drivers in its brand development by paying drivers to repaint their vehicles in its familiar yellow and black stripes. The firm’s managing director, Gael Campan, was not available for comment on its marketing strategy.
And although Cambodian media advertising costs only a fraction of that in the developed world, Hello’s brand manager, Gary Foo, said it’s not always good value for money.
“Given the quality of services provided, media [advertising] is expensive,” he said.
Part of the high cost of advertising comes from the size of the audience reached by any given ad in a country where the spread of mobile phones has far outpaced the spread of television, newspapers and certainly the Internet. But another part is the raw size of the existing mobile-phone market itself.
Foo estimated that out of a total population of 14 million, the size of the mobile-phone market was 5 million.
“Split evenly, that’s less than 500,000 subscribers” per operator, Foo said. “This is one of, if not the most, competitive, market in the world.”
Recent months have seen telcos going head to head in an aggressive pricing war. But as the tariff bar edges closer to the zero-cents-per-minute mark (Beeline’s “Super Zero” plan offers in-network calls free for the second to 15th minute), mobile firms have begun looking for a new edge by investing heavily in brand development.
Through TV spots, socially conscious programme sponsorship and new showrooms, each firm is hoping to make its brand synonymous with a new Cambodian lifestyle ideal.
Discussing the kinds of people who appear in Smart Mobile’s most recent TV spot, Chief Marketing Officer Kirill Mankovsky said: “They are young, passionate, good workers. They have friends, just married, good jobs: These are future and current Cambodians who have achieved something.”
Smart Mobile also runs a road safety “drive smart, drive safe” campaign (which includes road-safety seminars with the same name at around a dozen universities), and has sponsored an Angkor temple cleanup in association with the Royal University of Law and Economics.
But the face of Smart Mobile that far more of its customers see is the main showroom in Phnom Penh: a large, brightly lit consumer space over two floors. On the upper mezzanine, youngsters crowd around free Internet consoles and a row of Playstation 2s hooked up to big-screen TVs, while a T&C coffee shop outlet aims at a slightly older crowd.
Mobitel appears to be building a series of branded stores on Sihanouk Boulevard in the capital as it finishes building a third space on the same strip.
Kay Lot, Mobitel’s chief operating officer, said he was not authorised to comment on the company’s marketing strategy in the absence of CEO Jeffrey Noble, who was out of the country.
But physical presence has not always connected with consumers.
Mankovsky admitted that at first “many Cambodians considered the store too upscale. They were afraid they couldn’t afford our services, but our prices are quite competitive…. At the beginning, there were not so many people, but eventually it became really crowded, with so many more customers.”
Hello, which has existed in its current brand form for two years and is operated by Malaysia’s Axiata, has pursued a more fundamentals-based form of lifestyle marketing. Though the company is similar to Smart in its social engagement and event sponsorship – street-football tournaments, Siem Reap flood relief, free concert series – Hello has attempted to distinguish itself from the rest of the market in technology and pricing.
In particular, Hello is the only mobile operator in Cambodia to support Research in Motion’s Blackberry services – including push email – and voice SMS. Hello also offers a song-sharing app called music2gether and real-time chat application, Foo says.
He added that although many Cambodians still use their mobiles for basic calling and texting, “a lot of people are making a quantum leap into the mobile phone market”.
Hello is attempting to balance its upper-market vanguard position with an old-fashioned appeal to convenience and value. Foo said that on the whole, “people here are very cost-conscious”, one symptom of which is a tendency to switch out SIM cards or borrow phones in order to get the best rates.
Hello’s bid to counter this effect is the “Hello Laor” plan, which offers a flat US$0.07-per-minute rate for all calls, within or across network, a tariff it hopes is clearer than those of its competitors.
And that’s part of the problem, as Smart has found out.
After the recent launch of Smart’s “Wow” tariff, Thai-based Mfone followed this month with a tariff and accompanying advertising blitz using the same “Wow” moniker.
In Cambodia’s mobile market, branding out from the crowd is not always straightforward.