Popularity is very inconsistent. Even more so when it comes to a telco provider in Malaysia. With the recent furore over Maxis Malaysia’s plans, Maxis finally released their new plans and prices. But are their pricing just right and will they gain more customers?
Read on after the break to learn why we feel that perhaps Maxis Malaysia got their pricing wrong.
Maxis Pricing Wrong : An Introduction
I think Maxis is a great company. Having graduated with a degree in Telecommunications Engineering, Maxis, DiGi and Celcom were the dream jobs back then for me and my friends. Some who are working in Maxis. Thus,Â do understand that this article isn’t something against Maxis, but rather on why Maxis might have gotten their pricing wrong.
Pricing is subjective. AndÂ if a price war prolongs, it will be a battle to the bottom of the barrel, which will then affect the quality of service. As such, we applaud Maxis for being prudent and not stirring the hornet’s nest. But are their new plans something that will gain them customers?
With Maxis losing a million customers in 12 months1, the stakes are high against the once leading telco in Malaysia. Over this period of time, its competitors have gained some ground on them, with DiGi snapping up 450k subscribers with their interesting plans.
So we know that Maxis was slow to respond, but are their response good enough? Why do they price their plans in an interesting manner?
Maxis Pricing Wrong : The Analysis
A look at Maxis’ new prices tells us that their focus is on recruiting families. This is a brilliant idea as they need to make up for their lost subscriber base. However, there are weaknesses with their new prices which might ultimately cause them to continue bleeding subscribers.
In order to further understand Maxis’ prices compared to their main competitors, DiGi and Celcom, we have came up with a chart. As you can see, Maxis is really pricey if you start with the MaxisOne Plan 98. Compared to similarly priced DiGi and Celcom (both at RM 8/GB), Maxis tops up at a massive RM 19.60 per GB!
“But with shared lines it will be cheaper..”
Unfortunately not. Even at maximum shared lines, Maxis goes down to RM 9.50 per GB, while costing you a whopping RM 380 per month. That doesn’t help with the slowing economy and the fact that many people have lost their jobs within the past year or so.
Maxis Pricing Wrong :Â The Science Of Pricing
Imagine if I were to sell you three health wearables. Their pricing are as below
- Wearable 1 : USD 700
- Wearable 2: USD 300
- Wearable 3: USD 20
You see, if there was only Wearable 1 in the market, you might purchase it as you will be purchasing in a vacuum. But as I begin to unveil Wearable 2 and Wearable 3 to you, all the sudden Wearable 1 becomes expensive and less attractive than before. So what would make you purchase Wearable 1 if the prices remained equal?
In such cases, Wearable 1 can continue to sell well if the benefits outweigh the cost. If Wearable 1 could do things like help me in my workouts at the CrossFit gym, or perhaps tell me the calories of the food I’m eating, I might just pay more for it.
However, the weakness of a mobile postpaid plan is intangibility. Other than coverage and perhaps some add ons like Netflix, iFlix, Deezer, Spotify and such, there aren’t that much of a difference between plans. With DiGi expanding their coverage of East Malaysia, Maxis does not have that much of an advantage compared to their rivals.
Maxis Pricing Wrong : The Problem With Shared Lines
So the shared lines and data pool idea seemed brilliant, until we took a deeper look at it. Firstly, not all of your shared line members would be keen on 5GB of data only. Perhaps you have someone who likes streaming Youtube in your house and he/she ends up burning through your data pool within days? Or perhaps you have your parents who don’t use much data and a smaller plan would suffice.
Or perhaps you have some shared line members who spend most of their time in some WiFi enabled place like some hip cafe down the road or being stuck in the office due to some peak period. In such cases, it is better to consider the mobile postpaid plans by other telcos.
Perhaps the best way for Maxis to gain more subscribers is by offering similar plans upfront or have some substantial add-ons that will help add value to their plans. As of now, we would recommend both Celcom and DiGi over Maxis due to their upfront ringgit per GB differences.