Vodafone Hutchison Australia is launching heavily discounted mobile products in an effort to make $1 billion per year from small businesses by 2019 while getting corporate customers onto its mobile network.
Vodafone Australia's new enterprise business executive general manager, Stuart Kelly, told Fairfax Media that the carrier wants to increase its share of the $4.5 billion small-business market from the 6 per cent where it currently stands to 18 per cent by 2019. However, this includes technology products that Vodafone does not sell.
"That's an aggressive number to go after in the market," he said. "I think the value of the Australian [small business] market will continue to grow ... and it will surpass the $5 billion mark [within four years]."
Vodafone Australia is fighting hard to grow its revenue and market share after investing $3 billion over the past three years in its mobile network. The result has been increased competition that has threatened the profits at rivals Telstra and Singtel-Optus.
As part of this push it poached Mr Kelly, who was previously Optus vice-president of Mid-Market Business and UECOMM. He was tasked with creating a four-year plan to make Vodafone Australia a key player in the corporate telecommunications market.
"The amount of people who have stayed loyal with Vodafone over the years is enormous – it's hundreds of thousands of people," he said. "What we need to do is to serve them as they need to be serviced with world-class care to reward them.
"This year we're investing in our products, services and people and next year a lot of that will come to life and we'll really accelerate that." Ready Business plans
Vodafone Australia on Wednesday will announce "Ready Business" plans aimed at small to medium businesses. The telco has also set aside 100 dedicated staff to provide SMB customers more personalised care.
Companies getting between five and nine mobile subscriptions worth $70 or more each month will get a 25 per cent discount over the life of their contracts. If a business has over 10 accounts, this discount will rise to 50 per cent.
This means that a small business with 20 users on $70 per month contracts would save $16,800 over two years. All plans come with unlimited phone calls and the ability to share data.
The push is clearly aimed at winning customers away from Telstra and Optus, both of which sell a range of products for small to medium businesses. But unlike its main rivals, Vodafone Australia cannot offer anything more than a mobile service.
Where a $70 Red Business Grow plan comes with 3 gigabytes of data, the average Australian household consumes 58GB per month. This is thanks to the rise of new services like video-on-demand, video conferencing and cloud computing.
Mr Kelly insisted, however, that most Australian businesses would not need more than the download caps provided by Vodafone Australia's mobile plans. Phone call services also remained the key requirement for SMB customers, he added.
"I'm firmly don't believe so ... and the caps we have are suitable for their needs," he said. "When you're looking at SMB, it's a very unique marketplace of customers where mobile is critical to what they do and a lot are road warriors.
"They all have different needs and services but one thing we know is they're heavy voice [call] users – it's an absolute priority for everything they do."
He also said Vodafone Australia's decision to build call centres in Tasmania meant that customers could get Australian staff to fix problems.
"We deal with the four C's, coverage, cost, capability and the biggest C that sits in there, which is care," he said. "We have 100 people dedicated to that team and they're excellent – these people have been here a good period of time and they probably know more about Vodafone than most of the executive team."
Vodafone Australia's push comes after Telstra unsuccessfully attempted to stop it from using the "Ready Business" trademark in the Australian market. Telstra chief executive Andy Penn last week said he would ramp up investments in the mobile network in an effort to maintain the telco giant's dominance of the market.
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