Carphone Warehouse, death by a thousand cuts

I genuinely felt sad when I saw the news that Carphone Warehouse was no more. So many working lives will have been involved in its heady days of growth – from its own teams to the operators, distributors, handset manufacturers, right through to the events and marketing agencies it will have worked. It’s a real emotional loss.

To think Britain no longer has an independent large brand for mobile sales on the high street seems unthinkable. But it’s happened. Once the brand than operators fought so hard to get in with is now lost and forlorn.

The writing has been on the wall for a while. Networks have filed out the door. Branches have had to close, the Irish operation pulled altogether.

My immediate thought was for all the people who now join the job market. And I hope operators, distributors and vendors will see the value they can bring to their operations.

For consumers this is bad news. It’s bleak on the high street. There’s now next to nothing in terms of choice for consumers. The few electronic retailers that there are pose no real threat to the operators. Customers won’t have an easy task of shopping around especially if they are the high percentage of people who still like to touch and feel a real phone before making a decision.

You’ll also have to weigh up the sales pitch – four operators each with different and conflicting sets of advice. Of course we all know CPW wasn’t truly independent given the sales incentives and targets. But in its heyday, it did offer relative impartiality and give consumers space to make a choice.

Looking at the market now, it’s my opinion it won’t be long before Curry’s winds down its mobile category. It’s not really got the right ingredients, environment or brand, to appeal to the more mobile savvy consumers who probably still prefer some specialist assistance. It’s top of mind for the latest Samsung washing machine not the latest mobile.

But as an MVNO expert I have to also turn my attention to what it means for iD Mobile. It was a great business at launch and gathered pace well. But now, it’s likely to face the challenge of dramatically reduced customer acquisition. I expect there’s a frantic look by management going on, assessing how other channels to market, be it online or other retail partnerships, can shore things up. Could it exit altogether? Don’t bet against it. Today’s news is a reminder of how tough things can get and the tough decisions market forces provoke.

And as for Currys? Well sadly it wouldn’t surprise me at all to see it going the way of Rumbelows and Comet. Yes, remember them? It’s a brand I hold a lot of affection for having been a store manager for Currys, Dixons and their CPW competitor The Link – a brand Curry’s exited from about 20 years ago. But it’s going to take a huge amount of effort to salvage.

It’s all a reminder that having a clear brand vision and focus on specific customer segments, as well as innovation in service is absolutely essential to thrive and grow.

If you’re interested in discussing what this means for your company, or need help with segmentation, and/or operational turn around drop me a line…..

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James Gray

Managing Director at Graystone Strategy

James has over 20 years of experience working in the telecoms and retail industries. He is an expert in subscription-based business models, CRM, direct and indirect channel management and major proposition development and launches. He has held a number of Marketing Director and Consumer Director roles.