How Vodacom is changing the way you use the Internet - TechCentral

How Vodacom is changing the way you use the Internet

Vodacom’s Meg Your Day promotion, which offers subscribers up to 1GB of free data to use on specific services/apps, is changing the way we use the mobile Internet. Of course, Vodacom is not giving away free Facebook, Instagram and video data for some altruistic motive. Rather, it is training us to get used to the idea of data bundles for specific applications or services. Here’s how (and why).

Meg Your Day, which runs from mid-June to end-September, offers Vodacom customers with a data balance (and smartphone) free data for specific apps/services on each day of the week. They need to opt into this daily. So, for example, on Mondays subscribers get up to 1GB of Facebook data (these bundles run alongside your “normal” one and balances are available in the app). Video services (sports and YouTube) are reserved for Saturdays and Sundays when its network is generally under far less load.

First, this drives a change in behaviour where customers begin to get used to opening the My Vodacom app every morning. The importance of this cannot be underscored enough. This operator expects this channel to be the primary interface with customers and it is already using this to surface user-specific, personalised offers. These “Just 4 You” voice and data bundles are already being used by nearly 10m customers, with 728m offers sold to end-March (an increase of 150% on the 2016 financial year). Behind the scenes, big data and machine learning is being leveraged to provide real-time, segmented and contextual offers to customers. This change to segmentation and accurate targeting drives spending and consumption.

The free data being offered during the Meg Your Day promotion is a tactical way to get its 20m-plus data customers to get comfortable with app-specific bundles. Of course, this drives additional consumption on days when the data for Facebook, for example, is not free, but this is not the point.

‘It knows’

Vodacom has quietly started promoting app-specific bundles to customers via SMS. So, for example, you might receive a message on a Saturday (because it “knows” you’re mobile and not connected to Wi-Fi, plus it has a handle on your historical usage of free Instagram data during Meg Your Day) offering 250MB of Instagram data for R12. Buying a 250MB bundle outright costs R59, so one can see the appeal here. Offers are accessible via the *634# USSD code.

These are not likely to be huge multi-gigabyte bundles. They’ll be what the operator terms “micro bundles” (think 20MB, 50MB, 100MB, etc) and will generally expire at midnight (that is, on the same day).

In the bandwidth-intensive video space, Vodacom has also launched bundles for video-on-demand (VOD) consumption. So, 1GB of data to use on Showmax, for example, costs R75 (versus R149 for a “standard” 1GB bundle). Expect further iteration to include other services as well as allowing for scheduled (after peak) downloads at vastly reduced prices.

Given that bundles, particularly in the data space, are the cornerstone of Vodacom’s strategy, this innovation is not going to stop. It has been a trailblazer in the bundle environment (think back to the highly successful “Power Hour” and derivative prepaid bundles). Rivals MTN, Cell C and Telkom have a lot of catching up to do… WhatsApp bundles are not going to cut it. It is going to be especially interesting to see what strategies MTN implements from its other markets (where there tends to be a lot more innovation than in its home operation).

From a consumer point of view, these app-specific bundles mean lower prices. Older customers (“olds” as the millennials call them!) likely won’t fuss with this sort of thing, but the younger generation is savvy. Instagram and Facebook (with their increased focus on video) and YouTube consume a ton of data and this will help force the change in behaviour.

Finally, from a regulatory point of view, this move to app-specific bundles will see a further abstraction of tariffs, namely the prices we pay for data and voice, from those filed with communications regulator Icasa. Already, it is entirely unclear how Icasa could hope to regulate data tariffs on personalised/segmented offers. Trying to do so, or to regulate any app- or service-specific bundle is neither practical nor constructive (or indeed desirable). Let consumers choose.

  • Hilton Tarrant works at immedia. This column was originally published on Moneyweb

8 Comments

  1. Greg Mahlknecht on

    >Behind the scenes, big data and machine learning is being leveraged to provide real-time, segmented and contextual offers to customers.

    This made me laugh. The mobile operators, banks and other places that have been collecting my personal transactions for years are hilariously bad at data mining and showing relevant offers. Sometimes I think the only thing they do with all the data I have, is use it as a seed for their random number generator, which determines what to show me. It’s like Google/Amazon – for all their algorithms and big data analytics, all they ever seem to be able to do is show the last few items i bought online.

    I have a different take on what’s happening – it’s what they’ve always done – and there’s no real change with Meg My Day – Vodacom’s just adding more obscure billing rules so that people get used to doing these things cheaply, and when it becomes habit, they forget or don’t know it’s not a discount period right now, but do the action anyway with expensive data.

  2. This sort of promotion, like most along these lines, sounds like a fantastic deal but in reality is pretty much useless to most users. The similar one is “free internet banking’. When you look at how much data you actually use to do your internet banking on your smart phone it is, yet again a pointless promotion.

    What these ISPs are failing to address is the excessively high data costs, contracts that include things that are useless like SMS by the hundreds when you have data. The age of SMS is long dead but the ISP use them to pad out the cost of contracts. How can a provider charge you R0.85 for an SMS that costs less than R0.0025

  3. 250MB of Instagram data for R12. Buying a 250MB bundle outright costs R59….. Jeezzz, talk about shafting your bum hole!!!! Just how much money do these ISP’s make???

  4. Vodacom are becoming increasingly useless. One cannot get 3G access anymore on a 3G modem, only the slower GPRS, and even then, it disconnects every minute or so – and this is at night (early hours of the morning) so they cannot say that such disconnects are due to too many users online at the same time. As a semi-retired person, I wish there was a decent low-cost alternative.