In Monday's Globe and Mail, technology reporter Simon Avery profiled a recently released report which predicts the impact of new entrants into Canada’s wireless market. The report concluded that increased competition will lead to lower prices, resulting in 8 million new wireless subscribers over the next 5 years. Subsequently wireless penetration rates are expected to rise to 92.5% by 2014.
Price is a major theme of Avery’s article; he quotes the report’s author who believes that new players, including WIND, are going to have to undercut Bell, TELUS and Rogers in order to gain subscribers.
I wanted to flip around Avery’s article and look at things from the consumer’s perspective. I disagree with the assumption that “price wars” are the only way for the new entrants to compete. A year from now I’m fairly certain that I will be happily blogging about the latest statistics on lower wireless prices in Canada, but price is not the only issue. Based on feedback from Canadians, it has become clear that price isn’t the only indicator of customer satisfaction.
Phone choice, customer service, and contract length are all part of the ‘intangible’ aspects of wireless where Canadians are demanding change.
For example, the system access fee was one of the most talked about issues on Wireless Soapbox and continues to be a common suggestion in the WIND community. While certainly the system access fee is in part a cost issue, I believe the consumer distaste towards the SAF represents a deep unease amongst customers concerned about how they are treated for services they are willing to pay a fair price for.
The challenge for WIND Mobile and for other new incumbents will be the difficulty of measuring satisfaction. How do you develop a program that actually measures real change and real satisfaction? At WIND, the answer we're relying on is conversations, the conversations our customers are having, and conversations we’re having with our customers.
As always, I look forward to having another conversation with you!
How will you be judging the new wireless companies when we launch?
Will it all be price, or are you going to evaluate your options based on the intangibles like customer service and contract length?
Cheers,
Tony
I think you are absolutely right. The issue is not just price, but the overall sense that I am being ripped off and taken advantage of.
The fact that I have to pay for call display, that they tack on the ridiculous system access fee, the usury data (and voice and SMS) roaming charges, that evenings start at 9pm, and the ridiculous packages (WhoCalled? WTF?!) just make me feel totally gouged.
I would probably be willing to pay the same rates as now in total, if I felt like i was getting a fair exchange of service for my dollar.
Bottom line, is that I don't mind spending money but I want to feel good about the money I spend and feel that I am getting what I pay for.
While price is important, I agree that other factors will greatly influence my future mobile phone decision; price alone, would not be enough.
It would not matter what priced plans or phones Bell offered, I will not go back to them. The customer "service", and I intentionally put that in quotations, was absolutely atrocious. It seems to be corporate culture there, as I experienced the same depths of disdain for me as a customer when dealing with home phone and Sympatico. I'm happy to say, I am totally Bell free and will remain that way.
For me, the main thing I look for in everything is fairness and to feel appreciated as a customer. I don't need rock bottom prices that puts the company in jeopardy of going under, but I also don't want to put up with bogus fees and charges that are designed for no other reason than to pad profits. The SAF started out as a government fee but was dropped by the government just a couple of years after implementation... so why is it still being charged?
Hi Tony:
Price isn't the sole indicator of which wireless service provider I'd give my business to. There are other providers who provide cheaper plans than the provider I'm with, but I choose to be with my current provider because 1. it's GSM (= large phone selection), 2. (iPhone), and 3. a solid network. Upto now, I've put up with poor customer service and price gauging just so I can take advantage of the above. However, now with real choice and competition coming soon to the Canada, the reasons for me staying with my current carrier become less of a reason.
Going forward, the following will be important to win me over as a customer:
Great handset selection: I have a few devices, but my primary device is an iPhone. I've been using it since 2007 when it was first released in the US on AT&T. I used it unlocked until the 3G was released, and subsequently moved on to the 3GS after it came out earlier this summer. I'm not an Apple fan-boy but Apple has me hooked on this device. I know you won't carry it because it won't run on the frequencies you'll be operating on, but please make it a priority to secure this device after Apple upgrades it's hardware to operate on a greater range of frequencies.
Strong network: My current network is solid. For the most part, it has me covered and moreso than other people I know using a CDMA-based wireless carrier. Please build a strong network because at the end of the day, everything can be perfect, but if a call can't be made when it's required, nothing else matters at that point. Please don't become the Fido-of-old: It was seen as a great value but its network wasn't deemed good-enough for business use. And certainly don't become the new AT&T Wireless. Wind doesn't need to have the reputation of either.
Reasonable contract lengths: Please don't take customers for granted by locking them into lengthy 36-month contract (which should be illegal BTW). I bought my current iPhone 3GS for the full non-subsidized price at the Apple Store because I'm no longer willing to sign a 36-month jail term with my current provider. In fact, I'm waiting for my contract to expire. I don't think contracts should be longer than 18 months.
Hardware upgrades and customer service: If I'm spending a lot of money per month, then I shouldn't be restricted to a hardware upgrade every 24 months. That's ridiculous. Don't treat me as a second-class customer because you'd rather focus on new activations. As an existing customer, make me WANT to do business with you. Put more emphasis on being retention-drive, versus sales-driven.
Anyways, those are some of the things beyond price that matter to me.
Cheers!
NP
P.S: SAF = evil, 36-month contracts = criminal and call display should be standard.
I for one have seen my contract expire over the last 4 months and am not so patiently awaiting the arrival of the upstarts. Contracts are a serious concern, 3 years is a ludicrous amount of time most especially when tied to the life span of most devices.
I also agree with Dan, in today's day and age, services such as voicemail, call display and text messaging are staples of a cellular plan. These should be considered part of the plan (and perhaps consider a nominal rebate for that person who feels they don't require it). Seems to me reducing the plan's charge rather than adding to it is a better approach.
With this in mind, price is a factor although not one that is paramount to quality. I too would gladly pay what I'm paying now knowing I'm getting the most bang for my buck.
Hi Tony,
Agreed this is not a price war, and it shouldn't be. If it was, WIND would be at a huge disadvantage because of the size.
But, I agree with Dan, I don't mind paying, as long as I know what I'm paying for and it is understandable. I like to get services that I paid for, and only pay for services that I want. When it comes down to it, if you have a solid, user friendly product, there wouldn't be a need to a huge customer service department (I suggest trying to make things as easy and accessible as possible with a well built website that allows each of us to control our usage and account, but that is another story all together). Although a good customer service experience doesn't hurt, I don't think it will be a huge issue. In terms of contracts, I was really thinking you guys were going away from that. Some of your previous posts suggest that you want customers to stay with WIND because they WANT to stay with WIND, and not because they are forced by a contract. Another of your post tells us that you are not going to have contract altogether.
So in general I agree, it is not a price war. I am willing to come to WIND even if I'm paying the same thing now for the same services. Just make it easy and worry free and I think many people will be on board.
Thanks
R
Tony, bottom line, is phone choice, plain and simple. Sexy sleek phones sell, people will want these phones no matter what the cost is. If you launch with sub-par phones, that will make you appear weak in the marketplace. Example: every time I walk into a Bell Mobility store, I can't even imagine buying any of those phones, just awful awful awful. When I walk into a WIND Mobile store, I want the experience to be like I don't want to leave and keep on playing with the demo devices. I've been to Greece, I've seen what the WIND stores are like and offer, just copy and paste those stores here in Canada.
Now for the deal breaker. Please Tony get the Nokia N900, I've blogged about this phone before, it works on the 1700/2100 frequency. This should be your Flagship phone. Right when you launch you'll hit the ground running, do your research, divert the resources into getting this Computer/mobile device. I understand you have other things going on now with the CRTC stuff etc. The big three are trying to divert your attention. I gaurandamntee if you get this phone you'll be the envy of every cell phone provider. What Iphone did for Rogers, Nokia N900 will do for WIND mobile.
If you need some more advice, just email me, glad to assist you.
It isn't all about price. Being able to get help with an issue, make a call when you need to, and having features like Caller ID and Nationwide Calling included in your plan, instead of being $8 - $30 add-ons to a plan that already costs $60. And the SAF is a crime!
Although price is a relevant issue in the overall customer experience, it will not determine the success or not of the VALUE proposition.
All things considered, there is no reference to determine the value of customer service in the equation. Though there have been attempts to measure customer service satisfaction and it's importance, the wireless marketplace doesn't know better...
I'm thrilled with the upcoming launch of Wind Mobile, where for the first time in Canada a brand is being designed around customer experience.
I will evaluate Wind Mobile based on my experience with the Brand value proposition as a whole (products offering, plans, add-ons, customer service, retail experience, price, etc). Since everything else is average or just a business model, Wind is about to revolutionize how brands relate with customers and how companies do business nowadays!
You're right on the money Tony. It's not all about price (although that is an important factor.)
There are so many factors that go into choosing a wireless provider I don't think you can boil it down to a simple equation. Contract length, customer 'service', high data charges, complex plans that take a PhD to figure out, SAF, network capabilities; they're all part of the overall 'feel' of a provider.
I know personally, my deal with one of the big 3 expires next April and I'm waiting for the stars to align so I can jump ship to Wind shortly after your launch. Although I have no idea what phones you'll have, Wind has shown me that they at least seem to care about their customers (or more acurately, potential customers ; ) just by talking to us. Add that to the potentially cheaper plans and I'm very encouraged by what I'm seeing.
Just throw in a crackberry or two : )
I think you are right Tony.
I'll be looking at the phones, service, website, how fast the network is before looking to switch. I know Wind won't have the IPhone off the bat but a blackberry or android device is possible. Personally, I don't think its fair for a person to have to sign a three year contract for one device to last three years. I think 2 years is nice or anything shorter. I mean if I am signing a three year I'd expect to get an IPhone or BB for free. In UK signing a 18 month contract gets you a free IPhone. I hope Wind has shorter contracts, better features such as being able to see your usage right on your phone and in general a great selection of devices.
Enjoy the weekend!
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