SPECIAL REPORT: Phonecards - countering the mobile threat

8/8/2019 SPECIAL REPORT: Phonecards - countering the mobile threat

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Marketing Magazine

SPECIAL REPORT: PHONECARDS - COUNTERING THE MOBILE THREAT.

Despite the widespread adoption of the mobile and the doubling of callbox charges,phonecards are holding their own by RALPH ADAM, 09 October 2000, 12:00am

SPECIAL REPORT: PHONECARDS -

COUNTERING THE MOBILE THREAT.

Despite the widespread adoption of the

mobile and the doubling of callbox charges,

phonecards are holding their own

At the end of August, British Telecom announced the doubling of charges from call boxes.

According to Malcolm Newing, BT Payphones director, the hike came as result of increasing

competition, particularly from pre-pay mobiles, and was intended to safeguard the payphone

service's future.

'The mobile phone has completely changed the way people communicate away from home or

office, and now payphones are used for only six per cent of those calls,' said Newing. It's

obvious - and natural - that BT perceives the mobile telephone market as a threat, yet thesemisgivings are colouring promoters' perceptions of the promotional phonecard as an effective

mechanic.

The contention centres partly on fears that the phenomenal take-up of mobiles over the past

few years will make telephone-booth cards an irrelevance.

And, as mobiles carry an increasing range of functions such as voice-mail, internet access and

e-commerce capability, they are beginning to be perceived as a 'must-have', spanning all

generations.

Yet there is no evidence that the days of the phonecard are numbered; on the contrary, a 1999survey by the telecoms regulator, Oftel, into customer perceptions of competition in the

international calling market, found 64 per cent awareness of phonecards. While mobile

phones are seen as sexy, cards have become an everyday essential. The two can and do co-

exist, meeting different needs, and the general consensus is that phonecards provide

convenience, and a perception of value.

According to John Hart, sales manager at phonecard manufacturer Nitecrest: 'The phonecard

market is going from strength to strength, not just here but also in the US, where volume is

rising all the time.'
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Factors behind this increase in volume are largely practical - phonecards can eliminate the

need for coins when abroad, overcome expensive hotel phone rates and they can even be used

as an alternative to 'roaming' charges for mobiles.

Important marketing tool

And according to Fred Parker, chief executive of Telecard UK, BT's new charges are more

than likely to backfire and will make phonecards even better value as a promotional tool.

Certainly they have been an important marketing tool since the first promotional card, which

advertised a Paris hotel, appeared in 1978. Since then, both the technology and design have

improved greatly. There is now a wide range of added-value features which can be

incorporated into phonecards, and shape and visuals are limited only by the imagination.

And, unlike many promotional items, a phonecard has a long life - the number of telephone

minutes offered may be small (though too few minutes may not be a sufficient incentive), butthe card itself is often collected and retained. If the branding is right, the card won't be thrown

away and it will continue working for years after its issue.

Within this strong collector's market, thematic images becoming increasingly important. A

copy of the aforementioned French card was recently auctioned for a four-figure sum, but this

was based on its rarity and the idea of it being a 'first'.

In general, collectors prefer strong images and some themes seem to have unlimited interest:

anything with a mention of Coca-Cola, for example.

Other brands, such as Shell, also attract a lot of interest, as do pictures of planes, trains or

birds of prey. Well-known licensed characters, such as those from Disney films, are also a

major draw - one which BT was quick to capitalise on.

And their use has become more innovative. Parker says Telecard UK has commissioned an

artist to create special sets of phonecards with the theme Visions of Africa - one of the sets is

a promotional souvenir for SPIN. Telecard UK has also created several cards that promote

more intimate forms of communication, such as cards for Labatt's Ice Beer which has

messages such as 'Please phone me, I may need warming up!' with space for the user to write

his or her phone number before handing it over. And a similar card was produced as a give-

away for the film Cruel Intentions.

Another company which has managed to merge the promotional, retail and collectors'

markets is Excel Impact. The BBC has granted the company its first-ever phonecard licence

after signing a multi-year, pan-European agreement. The company plans to bring out a series

of six collectable cards featuring images from the BBC series Walking with Dinosaurs. Excel

Impact has also created a promotion for Blockbuster and pizza-flavoured Pringles - which

reinforces the link between snacks and movies.


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Interactive voice responseAnother of Excel Impact's licensed cards, a Coca-Cola bottle with an IVR (interactive voice

response) message which reproduces the sound of a can or bottle of Coke being opened, won

this year's Phonecard of the Year award in Miami.

Once a card has reached the collectors' market, it will change hands many times, giving apromotion extra impact. David Teasdale, Excel Impact's chairman says: 'The combination of

phonecards and licensed characters can prove irresistible when effectively deployed. But it

goes without saying that you have to meet the client's promotional aims.'

In some countries, designers have allowed their imagination free rein in creating cards.

Lenticular (moving image) and 3-D designs are now par for the course, and cards with more

than one application - key-rings, fridge magnets and necklaces, for example - are becoming

popular. Perfumed, and even edible, cards are currently under test.

As well as fancy shapes, sounds and smells, there are many technical features such as

interactive voice overs, auto-dial facilities (which give press-button access to a client's

customer services or sales number), interactive games, prize promotions, and other forms of

data capture-led activities. Cards have also been used to activate pre-paid mobiles (giving the

lie to the theory that mobiles will kill off phonecards) and to drive users to specific websites.

For some people, dialling two long numbers is a disincentive. BT's new Phonecard Plus tries

to overcome this problem. It is a remote-memory card with the numbers held on a chip, so it

can either be used in the conventional way from home or the office, or bridge technologies

and be inserted into a BT payphone.

Phonecards have become an everyday product with huge potential and those who see theirvalue as a promotional medium have a highly effective tool for brand-building and

recognition. The last word goes to Nitecrest's Hart: 'Phonecards have an unlimited future: I

can't see an end to it.

PHONECARDS AROUND THE WORLDFrance: Many operators are allowed to use short dialling codes for freephone numbers (four-

digits) to make users' lives easier.

- France Telecom, and its commercial subsidiary Regie-T, have been more aggressive

towards newcomers than BT. Its products include: see-through cards; promotional pre-paid

mobile cards called Mobicarte; cheap remote-memory cards to fight cut-price operators.

- Kertel has made auto-dial cards for retail chain FNAC) giving 200F of calls. Cards are re-

chargeable and are placed over the mouthpiece, and as the user presses a button it dials into

the company. For supermarket chains Monoprix/Uniprix/ Prisunic it has made a remote-

memory card, incorporating a magnetic strip that is validated at POS and can be re-charged

through bank-linked machines in-store. Kertel is also trialling pre-paid internet cards with the

French post office for its Internet cafes.

- Intercall made a champagne bottle-shaped card for Gosset for the millennium, and it has a

well-established collectors' club.

Italy


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Graf3 has produced a range of 3-D cards (images include Star Wars, signs of the Zodiac and

the Pope) for various clients.

Germany Motion Card has produced a lenticular card for Kodak. As you move it, the card

shows 20 scenes showing how orange juice gets from the fruit to the bottle.

Hong Kong: Hong Kong Telecom does cards which incorporate the user's (or any other)

photo in quantities of one and over.

Japan: Clients can order Promo cards as blanks ('white cards') giving the client the freedom

to print them as they wish.

China: 'Puzzle' cards by China Telecom are popular: either four, eight, nine or 16 cards make

up a picture when assembled. This encourages repeat purchase. In true Pokemon-style, some

cards are intentionally made in smaller quantities to maintain interest in collecting the set.

USA: Although a late-comer to phonecards, the US market is showing great innovation.Cards come in all shapes and sizes - even as a wall poster.

Many cards are validated at POS. A popular use for promo phonecards is to produce them for

company sales representatives as their visiting/calling cards.

- GTS produces an Electronic Inventory Distribution Control box that converts any plain card

to a phonecard at POS, including any blank cards that are sent out as part of a promotion.

- Auric makes a card that allows the holder to dial in from anywhere and connect to the

internet.

- GTE Communications produces cards with survey features that collect marketing

information or product registration: the customer is 'rewarded' with phone time; It is also

possible to add phone time as an alternative to points or miles on loyalty cards.

- Siesta Telecom has done a deal with the Vatican for an exclusive set of phonecards

featuring the Pope, with his signature, papal seal and a personal prayer.

Documents

SPECIAL REPORT: Phonecards - countering the mobile threat