How Mobile Network Operators Can Use Mobile Apps To Boost ARPU

I’ve used 3G in the UK several years ago but it was only recently that I “onboarded” on to this high-speed mobile network in India. I took baby steps by first signing up for the entry-level plan offered by my Mobile Network Operator (MNO). This came with 200 MB upload / download and cost INR 100 (~US$ 2). Twenty days later, Onavo told me that I was running periliously close – as in 94% – to exhausting my monthly quota of free data usage. For excess usage, my MNO quoted 2 paise per 10 KB, which had sounded innocuous when I’d first heard it. Kudos to my MNO’s marketing department for packaging this tariff in such an obfuscatory manner, but I thankfully realized that it translated to INR 2,000 per GB (~US$ 40 / GB). I shuddered at this exorbitant rate – around 8-10X of landline based broadband plans – and quickly decided to upgrade to the next higher plan which offered 500 MB for INR 200 i.e. INR 400 / GB.

Having used my new smartphone for so many things that I have previously done on a PC or telephone, I explored the possibility of doing the aforementioned upgrade transaction via my smartphone. Unfortunately, I couldn’t, since my MNO had no mobile app. What was worse was that its INR 200 / month plan was launched recently and it wasn’t possible to activate it even via SMS (which is how I’d activated the first plan before). The only way forward for me was to call the MNO’s Customer Care.

In general, I’ve never liked call centers, what with their phone trees, endless amount of waiting and listening to hold music. But, after my glorious experience with mobile apps during the previous month, an encounter with call center almost seemed like torture. I procrastinated for several days. But, eventually I went ahead and made the call because the alternative – incurring huge charges for busting my data plan – was even more unpleasant.

This experience got me thinking about whether I’m ever likely to buy additional products and services if my MNO forced me to use the phone or, worse still, told me to visit its physical store to place the order. Unlikely, especially for simple and discretionary items. On the other hand, if I got the opportunity to browse its Value Added Services (VAS) at my leisure using a smartphone, the chances of my ordering something or the other would go up dramatically.

If personal experience is anything to go by, MNOs and TELCOs have a tremendous opportunity to boost their ARPU (Average Revenue Per User) by launching mobile apps and letting their customers manage their accounts and order value added services through them. This is even more true in the case of 3G and other high ARPU customer segments. Such apps don’t even have to be enabled for (micro)payments, which could be a major source of friction for the relatively small amounts applicable for many VAS items: I noticed that, when these purchases happen over the phone, the MNO simply adds the charges to the monthly bill and presumably uses the recording of the telephone call as proof of order. For an order placed via mobile apps, clickstreams – or, are they called ‘tapstreams’ on smartphones? – should provide even more unequivocal proof.