Smart turn to dynamic pricing as inflation pinches Filipino consumers
Smart Communications Inc., the wireless arm of telecommunications giant PLDT Inc., is leaning on hyper-personalized data packages to sustain revenue growth as accelerating inflation threatens to cool consumer spending.
PLDT Chief Operating Officer Menardo Jimenez said the company’s ability to deliver customizable offers would make its wireless business more relevant and responsive to customer needs.
“We used to just be able to offer one package for the whole Philippines. Now, we can pinpoint the specific data requirements of our customers based on analytics, know what kind of package or service our customers need, and offer it to them,” he said.
Jimenez said providing customers with the service they need at the price point they want could mitigate the growth slowdown that is likely to hit Smart.
Based on PLDT’s financial report, the wireless segment generated ₱21 billion in revenues in the first quarter of the year, virtually unchanged from ₱21.3 billion in the same period last year.
PLDT attributed the revenue performance to “selective” consumer spending during the quarter, coinciding with the accelerating inflation rate amid higher costs of essential goods.
The Bangko Sentral ng Pilipinas (BSP) earlier estimated that the inflation rate in May climbed to as high as 7.9 percent, just a month after hitting a three-year high of 7.2 percent.
Last month, Jimenez said the wireless segment is on a “slippery slope” when it comes to rising inflation, as most of its customers subscribe to prepaid offers, making the business vulnerable to shifting consumer behavior.
Smart is looking to respond to this potential setback through hyper-personalized data schemes that would offer dynamic pricing and upsell programs to support higher take-up in the months ahead.
Through its low-cost brand TNT, Smart said it has rolled out “For You Po,” which allows subscribers to find data promos aligned with their individual data, call, and text needs.
“We have been leveraging our hyper-personalization capabilities which enable us to provide our customers the right service at the right price points at the right time,” said Smart co-officer-in-charge Lloyd Manaloto.
Smart is also banking on increased customer adoption of its 5G network to mitigate the pressure from softening demand, with one in every four subscribers already using 5G.
Smart’s total active data users reached 44.1 million in the first quarter, more than a quarter of whom, or 12.2 million, are 5G users.
The company said the wider availability of affordable 5G devices, coupled with investments in network optimization and expansion, would help drive greater 5G adoption this year.
“While we see the challenges, we are not allowed to use these challenges as an excuse. We're required—and that's in our DNA—to be able to look at these challenges and weather this storm,” Jimenez said.