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‘Consumers are at the Losing End of Promotions Ban’

18 Jan 2013

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 Sola Salako

 
As a consumer advocate and President of the Consumer Advocacy Foundation of Nigeria (CAFON), Sola Salako, has consistently canvassed for consumer rights over the years and  she has earned a front seat row in the struggle.

She spoke to Raheem Akingbolu on the recent ban on consumer promotions imposed on the telecoms service providers by the Nigerian Communications Commission (NCC). Excerpts:
 
Given the poor quality of service experienced on all the networks, isn’t the ban on consumer promotions and lotteries justified?

It will only be justified if there is proof that consumer promotions and lotteries are the reasons for the poor quality of service in the telecoms sector. NCC has not been able to establish that connection yet because two months into the ban, service is worse than what it was before the ban.


Therefore, until NCC is able to establish that there is a direct correlation between the consumer promotions and lotteries on the networks and the quality of service, the ban will be considered unjustified.


If there is that empirical data, that might be a good way of getting the service providers to do what they need to do, which is to improve on their service but NCC hasn’t shown us that promotions are the reasons why services on the network are poor. So the ban is unjustified.
 
What does the consumer really want? Is it consumer promotions or value for money?

Primarily, every consumer wants value for his money in any transaction; that is the primary reason why you engage in a transaction; that is the context under which a sale contract is sealed. But, when you are in business, there is a relationship. Businesses have come to understand that to remain in business you need customer loyalty and to have that loyalty you need to give benefits over and above values. That is what promotions are used for. They are used as tools to give benefits over and above value but they don’t replace value.

It is only in a strange environment like ours that consumers would have to depend on promotions in order to at least say: “I am getting some kind of value for what I have paid for”, because the basic contract itself has been broken.


Consumer promotions therefore give the consumer something back for the value he has lost. That is a lopsided situation, but that is what we are operating in Nigeria right now. But basically, the consumer wants value first before you can start thinking of benefits in terms of promotions and other things.

In the real sense of it, there may be no need for promotions in an environment where I’ve already had adequate value for my money. If you then give me all those bonuses and discounts they become added value and can be regarded as a promotion to encourage me to remain loyal to your brand in a competitive environment.

But in Nigeria, we don’t get value for the money we pay. Promotions have therefore become part of the contract for us. Because when a part of the contract has broken down, this is another part of it that can help to at least meet the basic expectation of one major aspect of the contract, which is value for my money. All those sales discount, etc., I don’t see them as discount because we are not actually getting value anyway from the very basic transaction that we have contracted. So, it not added value for me.

Do you think that consumers are sufficiently concerned about the ban on promotions?

Consumers will be concerned as soon as they start seeing how hard it is hitting their pockets. The bottom line is that right now, from my own experience since the ban, I have been spending more money on recharge cards than I was two months ago when there were streams of bonuses and loyalty free airtime. These are no longer available. So, for everything I do on the network, I have to pay; not only that I pay for service that is bad, I pay for calls not completed, I pay for text messages not delivered. In fact, there was a particular network that charged me N20 for text messages.

The minute I sent a message, N10 would be deducted and another N10 would also be deducted when the message is delivered. That’s not a front end issue but a back end problem. Obviously, something is faulty with that network’s billing platform but since it is benefitting from the malfunctioning, the service provider can ignore the problem until a regulator calls it to order. We need to feel NCC’s impact more on such issues and less on what freebies the networks are offering.
 
Isn’t consumer promotion the same thing as lottery?

A promotion is different from a lottery. If you ask me what I think they need to ban, it is the lottery because a promotion is benefit derived in the course of the transaction while lottery is chance soliciting by reason of inducements. Really, the fact that people have been turned into millionaires does not justify how the platform was being abused.


My primary argument for saying NCC should review this issue is because there are legitimate and deserving opportunities on the table for the consumer that they have taken away. I am talking about the promotion that says if you spend N500 on my network, I will give you four times of what you have used. Those are the legitimate benefits that I don’t think the NCC should take out of the game because they just want to ban everybody. I don’t think these bonuses are the ones stretching the capacity of the networks but the one that says “if you do it five times today, you may have a chance to win N1 million.”

NCC needs to put those bonuses back for the consumer because the he is suffering at both ends; we are not getting this service, the quality of service is as poor as when the ban was placed, and the little benefits that would have ensured we are not wasting money is taken off. NCC, by taking this blanket decision, is making us lose more money. We are loading cards and making calls that are not connecting and are being charged them. That is unfair. It is like being made to pay continuously for someone else’s mistakes.
 
What role should the Consumer Protection Council play in the logjam between the NCC and the service providers who are pushing for the lifting of the ban?

The CPC has actually been inundated with bitter complaints from consumers about the poor quality of service they are getting, which the council engaged NCC about. And I think it was on that basis that NCC acted on this ban on promotions and lotteries. Of course, the service provider went overboard with their promotions. It was becoming ridiculous. This was supposed to be serious business but they turned it into something ridiculous. That was taking advantage of the poverty mentality around here; to say people want to be ‘big men’ overnight, which can make them to do all kinds of stuff.

The Consumer Protection Council is doing its best with the resources it has, but they need to work closer with NCC on this issue to identify the promotions that benefit the consumer and separate them from the many lotteries that exploit him. CPC should ensure that NCC does not throw the baby out with the bathwater in this situation. They must look to protect the consumer’s interest in this issue.

But also, for advocates like us who have taken on the responsibility to speak on behalf of the consumers, what we should be doing is what we are doing now, pointing out to the service regulator what it is yet to do, also commending the agency when necessary and helping it to see why it should see certain issues differently, because the goal is not for anyone to score a point, the goal is for the consumer to have value for the money. We should also help the consumer to understand his own rights, where he has been short-changed and how to seek redress.
 
What is your advice for the NCC?

I can only ask the NCC to go back to the drawing table and review its decision again with all the options that I have put on the table. Is it giving us the result that we expected? If it is not, NCC should be magnanimous enough to go back to the table and say, let’s review this, let’s adjust this and that. That’s what I expect. As for the businesses, what can they do? They can’t force NCC. They can only pray, which is the only thing we have in abundance in Nigeria.

But really, I think NCC has to go back and review the impact of its decision. Having imposed the ban for two months, they should give us a report that shows that services have improved or otherwise because when you make a decision you must be able to evaluate its impact with empirical data. Let us know if this is going to be forever and there would never be any promotion in this sector again, or when is the ban supposed to be lifted? What are the conditions to lift this ban? We don’t know. At least if we know, we can be shouting at the service providers: “Please meet these conditions so that we can get back our benefits.” NCC still has a lot more to do which they are not doing yet.

What should the industry regulator and the players do to ensure that the consumer derives value for money?

One, work with them to develop capacity on their platforms. If their capacity is expanded to handle the number of subscribers, we would not be talking about poor quality of service. Two, put the structure in place to make sure they use the platform for communications and not to run lotteries. But if you want to run lotteries on the networks, give the consumers the option to choose to join the lottery or not. It should be: “To join the lottery, text your number to a particular number or sort code”; and not “if you don’t want to be a part of this, send a text to say No.” That is already signing me up for what I didn’t sign for in the first instance. The regulator must define what is acceptable or not acceptable on the platforms.


They also need to work with the service operators to have active, vibrant and accessible customer service call centres. All their call centres have failed and that is an indication that they don’t have capacity even in the call centres. How many call centres should a network that has 10 million subscribers have? How do you determine the number of call centres that is adequate for your subscriber base? The service providers don’t have customer care standards because nobody is setting it for them. So they can do anything they like.

How can a customer who wants to reach you be on the line for 30 minutes and he can’t reach you? Every operator should be penalised for that. There is need to push them to build capacity in their call centres by setting minimum standards acceptable before they can increase subscriber base. Then they will start working towards that. That’s how you will be able to ensure that by the time they meet up with the standards you set for them, the customers on the street would know you have been doing your work because once you dial, you’ll be able to reach your desired number.

As a regulator, NCC cannot afford to take emotional decisions. A regulator has to be clinical, very objective and empirical, even when it looks as if you are not acting as fast as desired. You can’t just say because somebody is shouting you want to go in that direction. If you are going in that direction, you must go with your head in place, you must think deep and take the necessary steps to protect all interests.


As a regulator, you are supposed to be very objective so that when you take a decision, you know that it is sustainable. NCC should ask: “If I take this off the table, how many people would lose?” How many people will become millionaires compared to the hundreds of millions on the networks? I don’t think that one million Nigerians have benefitted from any of those lotteries they run. But the promotions and discounts affect probably maybe 30 to 40 per cent of subscribers on the networks. You don’t throw that away. You have to work to preserve the benefits while eliminating the challenges. That is the duty of an effective and efficient regulator.

Tags: Business, Nigeria, Featured, sola-salako, NCC

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