Catch Group, who run the ecommerce site Catch.com.au, are partnering with Optus to start Catch Connect – a new MVNO offering cheap phone services over Optus’s 4G network. The collaboration with Optus is one of a number of changes made recently by Catch Group that includes the acquisition of the Pumpkin Patch brand, shuffling of assets with the Lux group, and the creation of an online marketplace for the popular parenting website Mamamia.
Optus have also been busy with other collaborations, launching an Ethernet over NBN service and an NBN voice service over Ethernet. Similar collaborations have proven to be successful in the past. Vodaphone and Kogan have demonstrated a comparable partnership since 2015, showcasing the combination of a major telco and an online retailer providing cheap phone services. Other notable examples include supermarket MVNOs such as Aldi mobile, which use their wider brand to market and sell cheap phone plans using the infrastructure of a major telco.
How Do MVNOs Work?
Mobile Virtual Network Operators use the infrastructure of a bigger telco company to provide mobile phone service at a cheaper price. Catch Connect will have the functionality of the Optus 4G network to provide services to its new customers, while providing a different range of plans than Optus which will reach a different market of consumer.
MVNOs are able to provide services at a cheap price because they can target a market, drastically reduce overhead costs by only providing a limited number of services, and avoid expensive fees relating to creating and maintaining infrastructure. Most MVNOs don’t have physical shops, relying on online and phone support only. The reduced personnel required for this type of business also lowers operating costs.
MVNOs have more freedom to tailor their packages to a niche audience and trial new ideas for phone plan inclusions. Catch Connect’s 90 day prepaid plan is a fairly unique offering that many customers looking for a low-budget, low-commitment plan will find attractive. Pairing it with shopping vouchers allows Catch Group to simultaneously strengthen both areas of their business, encouraging customers to spend money on their websites and continue with the longer-term prepaid plans.
Catch Connect’s Advantage
One of the downsides to operating an MVNO is that marketing becomes more difficult – the budget for advertising is not anywhere near as large as that of a major telco. While there might be an amazing product on offer, it will be harder to attract customers. A similar drawback is the lack of brand recognition – many people will not be inclined to trust a company they have never heard of.
Catch Connect should largely avoid these issues by having their phone company working with their established online brand to help recognition, and act as a built-in advertising platform for their phone company. Customer service is another common issue that many MVNOs face, as they struggle to match the support the major telcos offer with a limited number of staff. As a company with a larger backing, Catch may find these issues easier to manage as well.
Catch Connect Offers
Catch announced their plans to offer prepaid plans to customers, with either 30 or 90 day plans available, or a 30 day prepaid data service. As a SIM only service, customers will need to bring their own device. As an offer to new customers, Catch Connect offered vouchers for discounts on purchases made on Catch.com.au.
All Catch Connect plans offer unlimited national talk and text, with data and the expiry being the only difference. Using the Optus 4G network, the company has a coverage map available. The plans are very cheap, and offer competitive amounts of data when compared to other similar companies. International calls and roaming can be purchased as an additional credit if desired.
Their 30 day plans start at $15 for 2 GB, and the 90 day plans start from $39 for 6 GB. Catch Connect also offer a “Catchback” deal with their 90 day options, giving customers a voucher to spend on the Catch.com.au site. Customers are offered one voucher per month over the 3 months, with a minimum spend required. Pre-paid credit is set to auto-recharge, but this feature can be disabled if desired.
The Catch Group and Optus collaboration should offer customers another low-cost option with good coverage. It should also prove lucrative for the two companies that form the partnership.