26 November 2024

Are you on the best mobile plan? We think your telco should tell you

By Nick Gelling

Product Test Writer | Kaituhi Whakamātau Hautaonga

Your mobile service provider knows a lot about you. How long you talk on the phone, how often you’re on the internet, and your busiest months of the year. At a minimum, you should be able to see that information, so you know if you’re getting value for money. But does your telco also have a duty to make sure you’re on the right plan?

We’ve reviewed the three biggest mobile providers – Spark, One NZ and 2degrees – for how well they empower customers to choose the best plan for their needs. It’s the third year we’ve run the review, in partnership with the Commerce Commission.

Transparency and right-planning

We’re always happy to see New Zealanders switching mobile plans, because that indicates a healthier market with better competition and value for consumers.

Ideally, we’d like everyone to review their options with several providers every year to make sure they’re all getting the best deal, but that simply doesn’t happen. Only 8% of consumers switched mobile provider over the past year, more than 6 in 10 have been with the same provider for 5 years or longer, and movement between plans offered by the same provider remains low.

It’s crucial that providers empower consumers to analyse their own data so they can shop around. But, when that doesn’t happen, perhaps the next best thing is for the providers themselves to help where they can.

This year, Spark began regularly and automatically analysing customer data and suggesting to customers that they either stay on the same plan or switch to another that fits better.

In the industry, encouraging customers onto different plans is called “right-planning”. In New Zealand, it’s historically been done in a sporadic and ad-hoc way. It also hasn’t always been in the customer’s best interest.

When we hear from our members about right-planning, it’s usually when they’re being unnecessarily suggested a more expensive plan or poorer service.

However, done well, right-planning can be a great way of looking after customers and saving them money. We think it could be a crucial feature of the mobile service market into the future.

How each provider did

We assessed each telco to see how clearly they presented the information consumers need to make educated decisions about which plan and provider they should choose.

Our criteria were based on the Commerce Commission’s expectations – primarily, 12 months’ worth of history on what customers have spent, and how many megabytes, minutes and texts they’ve used. The history should be available on-demand through a mobile app and also summarised in an email once per year.

Spark

Mobile app: 85%
Annual email summary: 73%
Overall: 80%

Spark has boosted its rating this year in two major ways.

In its app, usage and spend information has become far more accessible. A button on the home page now takes customers straight to the data (previously, it took three clicks and some scrolling). The information has always been (and remains) useful and understandable, but now it’s easy to find too.

According to Spark, this change is a trial to see if customers like the new button and use it more often. We’re strongly advocating for the change to be made permanent and have rated the app on the assumption it will be.

Secondly, Spark has completely revamped its email summaries. The “Made For You Review” summarises usage fairly well, although it only stretches back 6 months and lacks detail on how much you spend.

The real innovation, as mentioned earlier, is that it gives a personalised recommendation. You’ll either be advised to stay on your current plan, or switch to another of Spark’s plans that will better suit your needs. We think it’s a great development. Just remember that the recommendation is algorithmic, so it won’t be spot-on every time.

One NZ

Mobile app: 63%
Annual email summary: 74%
Overall: 67%

The usage information in One NZ’s annual “Your year in review” email is comprehensive and easy to understand, leaving you well-placed to do your own research. Unlike Spark’s summary, it doesn’t include a plan recommendation, with one exception. For users with very low usage patterns, the email suggests a switch to a cheaper prepay plan, which is another right-planning initiative we’re happy to see.

One NZ’s app has also seen an improvement since last year. It’s now easier for customers to find their usage and spend information.

Unfortunately, the information itself is somewhat lacking. Customers can only access 2 to 3 months’ worth, which isn’t long enough to account for seasonal differences – for example, if you use more data during summer when you’re out in the evenings.

2degrees

Mobile app: 92%
Annual email summary: 60%
Overall: 79%

The 2degrees app remains the gold standard for transparency. It clearly demonstrates what you’re using and spending on your contract, and the information is placed front and centre for easy access.

However, the annual email, which hasn’t changed since 2022, is showing its age. If you’re a 2degrees customer, you’re better off simply treating your “Happy Anniversary” email as a reminder to check your usage in the app.

Like One NZ, 2degrees does not provide a personalised plan recommendation either in its email or its app. Any right-planning is a result of manual work by staff.

The state of the market

Since we began conducting these reviews, operators have made efforts to improve their transparency with customers. That’s evidenced by 2degrees, which felt streets ahead in 2022, being overtaken by Spark for the first time.

At the same time, the bar has been raised. The Commerce Commission expects more from providers in 2024, so there are plenty of improvements that can still be made – starting with other operators following Spark’s lead and routinely suggesting better plans for their customers.

“Three years ago, we asked mobile providers to give consumers better usage and spend information, noting that we’d use Consumer NZ to independently measure progress each year. Three years later, we can see that outcomes have steadily improved for consumers over this period, but with scope for further improvement. We’re encouraged to see increasing competitive pressure towards proactive rightsizing that will maximise benefits for consumers,” says Tristan Gilbertson, Telecommunications Commissioner.

Both Consumer and the Commission encourage you to check your average usage at least once a year and shop around for the best deal on your mobile. There’s no point having all this information available to us if we don’t use it.