Public opinion research commissioned by the Office of Electronic Communications in 2006-2007 showed a high level of brand recognition for the Polish mobile operators Era – 90.2%, Plus – 88%, Orange – 87.1%, Play – 54% in 2007).
This high consumer awareness is connected with the significant spending of mobile operators on marketing activities, including on advertisement (16% of the telecoms sector as a whole and 13% of the mobile telephony segment alone, in the total sales volume of the outdoor advertising sector in Poland in Q1 2008). Suffice it to say that three most recognisable mobile operators made it to the top five of brands with the highest spending on outdoor advertisement in July 1008. These activities are justified, even more so given that the vast majority of Poles (83.3% in 2007) gains information on offers of mobile operators in the radio and TV.
As at 1 August 2008, the following operators operated in the Polish mobile telephony market:
The battle for a consumer is a necessity given the high market saturation on the demand side (penetration of 108.6% at the end of 2007), where the quantitative disproportion in network user profiles is still observed. According to the consumer survey, 51.9% of customers used post-paid services and 43.4% of consumers used pre-paid services in 2007, but these results do not reflect the actual structure of the customer base of mobile operators, where the number of card users was higher than the number of post-paid customers – 26.7 million vs. 14.8 million in 2007, respectively.
This disproportion is attributable both to operators and consumers. In the past several years, mobile operators focused on how to gain and maintain pre-paid customers, who tend to be less loyal as they do not sign any long-term agreements. In addition, consumers (both pre-paid and post-paid) were not willing to switch operators; in 2007, 83.5% of respondents claimed they did not consider changing their operators, and 87.5% did not plan to buy a different or additional mobile phone. According to forecasts, this disproportion may continue even until 2012, unless operators start an active battle for their current post-paid consumers.
Please note that in 2006-2007, the number of customers who used the number portability service nearly tripled, and although only 1% of users now decide to port their number, given the dynamic increase of interest in this service and the shortening of number portability procedure (planned by the Office for Electronic Communications), more consumers may port their numbers in the future. As a result, competition on the supply side may become even more intensive, also for post-paid consumers, who are less numerous, but they spend much more on mobile telephony than pre-paid users (PLN 90.7 vs. PLN 50.6 in 2007).
Cost of mobile phone use is still the decisive factor when selecting a mobile operator (in 2007, 67.5% of respondents claimed that price is an important factor, and 63.5% paid attention to attractive promotions and rebates). Therefore, the main tool used by operators competing for network customers is likely to be the price of the most popular services – i.e. voice calls (used most frequently by 73.3% of respondents in 2007) and SMSs (29.6%), which still remained much higher in Q1 2008 than expected by respondents in 2007, for instance in roaming offers of the EU and EEA operators.
The price battle may also include niche services such as MMSs (only 0.2 billion MMSs sent in 2007 vs. 38.8 billion SMSs), as well as WAP/Internet (only 0.3% of respondents in 2007 claimed that it is the most frequently used service). Therefore, stakes in the price battle are still high, especially that, according to forecasts, monthly spending of active network users will increase from about PLN 43 in 2007 to nearly PLN 48 in 2012, and the total retail spending of all network customers on mobile telephony services will rise from about PLN 19 billion to about PLN 26 billion.
In the nearest future, operators may also focus on consumers who do not use a mobile phone at all – this segment has been decreasing steadily, but it still exists. Although as many as 45% of respondents who did not have a mobile phone in 2007 declared that it was sufficient for them to have a fixed telephone, and 32.1% of respondents declared that they use these services occasionally only, as many as 26.3% explained that high costs were the reason for not having a mobile phone. This group may change their minds if operators keep reducing their service prices, especially that the majority of respondents – 54.7% in 2007 – find it very important to have a mobile phone, which proves that mobile telephony services gained widespread social acceptance in Poland, and (partially) that the information society is developing in Poland.
The full version of the report - please see attached file.