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Mobile perks falling flat? Carriers scramble to address backlash over shrinking benefits.

Published: 23 Oct. 2024, 10:03 Updated: 23 Oct. 2024, 10:05

KIM DONG-EUN
[email protected]

Three mobile carriers of Korea are KT, SK Telecom and LG U+. [KT, SKT, LG U+]

The usefulness of membership promotions is a key factor mobile phone users consider when choosing a phone plan.

Korea's three major mobile carriers — SK Telecom, KT and LG U+ — each offers unique membership points systems and monthly events, setting them apart from mobile virtual network operators (MVNO), or altteul phone operators.

However, in recent years, they have faced criticism over reduced discounts and questions about the practicality of their benefits.

On Oct. 8, during a parliamentary audit, representatives from the three carriers were questioned about their plans to address the shrinking benefits.

In response, the companies have expanded partnerships and implemented new marketing strategies, using push alerts and other methods to better inform users of their deals.

KT's October membership promotion plans include ″Lotte Collection,″ which offers discount benefits for purchases from the Lotte Group affiliates. [KT]

KT's monthly "Daldal Benefits" runs from mid to late October, with this month’s promotion taking place from Oct. 15 to 31. KT has partnered with Lotte Group under the "Lotte Collection," offering discounts across Lotte-affiliated businesses, including Lotteria, Krispy Kreme, Lotte Cinema, Lotte Rental Car, Lotte World Adventure, Lotte World Aquarium and Seoul Sky.

Promotions include “Ria's Shrimp Combo” or “Hot Crispy Chicken Burger Combo” with a 45 percent discount from Lotteria, “Original Glazed Dozen” at 40 percent off the original price of 17,000 won ($12.50) from Krispy Kreme and a two-hour free rental service at Lotte Rental Car's car-sharing brand, “G car.”

A screen capture of SK Telecom's monthly membership promotion ″T day″ with its details [SK TELECOM]

SK Telecom designates one week each month and every Wednesday as "T Day." October's promotion dates were from 7 to 11, with additional "T Days" on Oct. 23 and 30. Subscribers can enjoy discounts and bonus offers from franchises like Shake Shack, Pizza Hut, Hollys Coffee, delivery service platforms like Coupang Eats or Yogiyo and theaters CGV and Lotte Cinema.

Upcoming offers for Wednesday include 6,000 won Baedal Minjok discount coupons for Chicken franchise Cheogajip, 30 percent off coupons and a free drink at Shake Shack.

LG U+ runs a monthly promotion event on the dates based on the shape of the calendar on which two plus signs are drawn. [LG U+]

LG U+ runs its "U pl Two pl" monthly promotion from the second Tuesday to the fourth Thursday of the month, alongside select weekdays in between. This month's designated dates are Oct. 8, 10, 14, 18, 22 and 24. This October, discounts are available from partners like Amorepacific and Daiso.

Additionally, every 20th day of the month is "Uth Day," offering special deals for users in their twenties. This month's “Uth Day” includes a free drink from Mega Coffee for the first 20,000 users, convenience store brand CU discounts or 1,000 won coupons depending on the membership level and a free month's use of Naver Plus Student Membership, a subscription service with package benefits for Naver content, shopping and affiliates.

The carriers have also ramped up communications with users.

KT has shifted from weekly to daily notifications, while SK Telecom is leveraging its AI-based commerce platform, T-deal. LG U+ launched "MoneyMe" in July 2023, which detects unused benefits and converts leftover membership points into cash.

According to data from the National Assembly's science, ICT, broadcasting and communications committee, 70.1 billion won worth of membership points expired between 2017 and August 2022. SK Telecom accounted for 35.1 billion won of that total, KT for 11.7 billion won and LG U+ for 23.3 billion won.

This surplus is partly due to daily point usage limits, which restrict users from fully utilizing their discounts.

The rules for using the points have also become stricter over the years. Benefits like free movie tickets are now reserved for VVIP members, a higher threshold than in the past. For KT, VVIP members must subscribe to annual plans worth over two million won, while SKT requires a five-year commitment with an annual plan of at least 900,000 won.

KT CEO Kim Young-shub [KT]

On the questions raised during the parliamentary audit on Oct. 8, KT CEO Kim Young-shub said, "KT will thoroughly revise the issues addressed from the current membership system and work toward coming up with an innovative plan."

"SK Telecom expanded the membership benefit's affiliate pool to 164 companies, and will work to provide substantial user benefits," said Lim Bong-ho, an SK Telecom senior vice president of marketing strategy during the audit.

"The top priority for LG U+ is focusing on the customer experience, and the total sum of membership points has increased compared to last year due to expanded benefits and rewards for long-term customers," said LG U+'s chief of consumer division Chung Sue-hyun who attended the audit.

BY KIM DONG-EUN [[email protected]]