It’s an unstoppable multi-billion-dollar industry and you’ve followed the developments of new licenses around the world. Your analysis shows you that you could make a name for yourself in a burgeoning market.

You’ve got the intel, and the spirit and drive to be successful, but how do you get your idea off the ground quickly?

Ordinarily you’d expect me to say that you should develop a proposition, one that will give a substantial cohort of consumers something different, and compelling, even unexpected. Do the business case and speak to the operators and become an MVNO. It’s a tested model – Deliver a killer go to market strategy and through all means possible drive awareness of your brand and ultimately achieve cut through and customer consideration.

That’s a considerable commitment in time, and cash, even before you’ve started trading. Is it really possible to follow your dream?

Yes, and it can be easier and less costly if you re-evaluate what a brand is. If you set aside the concept of creating a brand, and all the complexities that comes with, but instead focus on the other core elements of running a business then you have a chance.

But a brand is the business I hear you cry. And yes, it is. But you can be a brand without creating your own. Today more and more fledging mobile entrepreneurs are latching on to the merit of licencing a brand.

I bet it’s not something you’ve considered before. It’s an option that has been quietly ticking along in the wings for some time now but came into the spotlight at MVNO World Congress in June, thanks to David Clyde, Brand Director at Lebara.

Lebara is a fascinating MVNO story. It’s now a well-known global MVNO brand, and it stands out because it’s a mobile provider that has proven how it’s possible to adapt a core brand for different markets.

Wherever you travel, the Lebara brand will be recognisable. It’s distinctive logo and uncomplicated offer shine through. Its rapid growth around the world is testament to decisively sticking to its core proposition and knowing its audience.

However, Lebara recognised some time ago that there isn’t a ‘one size fits all’. Brands don’t survive unless they make adjustments for local market conditions, language, and culture.

It’s something that Vodafone have led the way on. The brand team there, understood that a globally recognised and highly valued brand which is usually unwavering in its brand guidelines, needs to flex to accommodate local market nuances without losing the brand essence.

More critically, Vodafone has been highly successful at monetising the brand and what it stood for, by establishing a ‘partner market’ network. With this model, Vodafone allows partner markets to leverage the brand, the propositions, and the insights without technically being an operating company owned by the Vodafone Group. It’s a winning formula – partner without the cost of a network roll out and establish a brand presence in new territories with ‘relative’ ease.

In terms of how you and I experience it, it’s really quite straightforward. When you travel to a Vodafone partner market you may see familiar proposition elements including retail formats that are identical. The brand you trust in the UK is instantly recognisable, and all it stands for comes to mind just being seeing the shop front.

In this case, Vodafone is taking all the best practice, insight and trading experience across retail, proposition, brand, CVM, roaming and so on, and giving partners a way to leverage it all so they can accelerate their own commercial success and what’s more, do it with a standout brand.

It’s with this context in mind, that Lebara’s brand licensing proposition for MVNOs is so interesting. As a budding MVNO you can access a globally recognised brand and customer proposition, with the help of a team who have driven growth for Lebara globally, vastly increasing your chances of success in your chosen market, and probably adding significant credibility for those all so important MNO wholesale discussions.

Is now the time to strike?

Quite possibly.

Lebara has moved quietly and confidently with its strategy, establishing partners in Australia, Switzerland, KSA and Spain. More recently, it announced a partnership in Nigeria with Vas 2 Net, one of the Tier 5 license holders. Vas 2 Net will benefit from an established brand, exec expertise across every discipline and function, and benefit from know-how built from years of hands-on experience. This level of help is undoubtedly invaluable for any new MVNO.

It makes good sense for a start-up MVNO to go this way. As I’ve said, building a brand can be an expensive business both in terms of time and hard financial cost. I know from experience of launching MVNOs in a number of markets. In all cases, we had a trusted brand (Sainsbury’s for instance) and we were simply leveraging the brand values and customer loyalty to move into the mobile space.

For an MVNO starting out with a blank piece of paper and absolutely zero brand awareness or customer consideration, it can’t be overstated how much of a big task it is to make a name for yourself. It takes hefty marketing budgets to gain cut through.

So, why not look at leasing? It’s not just any brand that Lebara is delivering. It’s a well-established and trusted MVNO brand with impeccable smart value credentials, exactly the type of brand that any start up MVNO would aspire to be.

On top of all of that there is the unparalleled knowledge, insight, and experience that MVNOs can tap into, all of which has enormous value.

Of course, it would be naive to think Lebara will work with anyone. Afterall, it has a brand to protect too. Expect it to be highly selective about who it will partner with and steadfast to ensuring every licensee delivers against brand expectations and promises.

Brand licensing won’t be for everyone, in fact start-ups may look at Lebara, Vodafone (and others) and think that they could monetise their efforts with their own licensing strategy. It definitely gives weight to the argument to invest in building brand equity as part of an investment in the future.

With that strategy comes other options too. For instance, you could sell the brand to the MNO to create a sub brand that’s promoted in markets they believe they can grow share in.

My point is, MVNOs have more options for growth than they perhaps realised before. Just as they have a range of choices about their technical strategy and their commercial strategy, they now have some interesting choices on brand and marketing strategy too.

The reception David received at the conference, highlighted the appetite for this diversification. And the questions I was asked subsequently, show how much head scratching is already going on. I’m sure this won’t be a strategy confined to a few markets for very long. Not only should we expect to see more Lebara brand licensees in the future, but I’m certain other big MVNO and/or MNO brands will follow suit in the coming years.

If your head is fizzing with ideas after reading this, then our expert team at Graystone Strategy can help you work through the best approach for you. With over 100 years collective telecoms and MVNO experience spanning technology, operations, commercial and marketing we can help you make the right choices for your MVNO.

The post Is the MVNO future all about brand licensing? Lebara certainly thinks so. appeared first on Graystone Strategy.

My bets are a decision will come, and it will be to let it go through to phase 2. It’s a long process, probably running until the Autumn, and will be run by a second independent team, but it’s wholly worthwhile. I see no reason not to do the due diligence.

Phase 2 will get into the nitty gritty. Fundamentally, it will look at the market, the consumer interests and wider national infrastructure issues. Economic prospects will form part of it – jobs are always a thorny issue. I see that as an inevitable part and parcel of the market, and of course this deal, but I don’t think the CMA will say it’s a deal breaker.

Chinese ownership has also been cited as a barrier to merger, and parliament debated this on 14^th December 2023 (you can watch it here). It’s important to note that aspect is out of the hands of the CMA. Its remit is to look at competitive telecoms. The NPSA will have its say, I’m sure and it’s best we await their judgement.

I guess the big question is why now?

If like me, in your early working life you watched Vodafone emerge from above a curry house in Newbury, you’ll find this a fascinating tale of fortunes. How can the trailblazer be in a position to consider merging with the minnow?

Speaking on the record to both parties, the proposed deal is about scale. I have to agree that it is a necessity in the UK. The last few years have given birth to some hefty players. BT/EE and VMO2 are making returns, and Vodafone and Three will feel like they’ve been left in the cold.

For Three, the options are limited since the failed merger with O2. It needs this to work. Vodafone will argue it needs it too. But for different reasons – a merger is a steppingstone to acquisition (let’s not forget the 51.9% share it would have), and the share price needs revival.

A merger would stabilise market dynamics. But most importantly it will give the UK’s 5G infrastructure the capital boost it needs. £11bn is on the table and I’m doubtful consumers will be sold on the 5G dream until they experience it everywhere, every day. They certainly won’t pay any more for it until they realise more of the benefits the government wants for its UK ‘power-house’ credentials.

The real advantages for consumers and businesses will come from continuity of service and connectivity – promises associated to Digital Britain. With combined capital, RAN and spectrum sharing that a merger like this facilitates will give consumers better, faster mobile. That can and will drive market competition and challenges the network leadership of BT/EE. It all adds up to an enticing prospect for the government, which so desperately needs to prove UK ‘power-house’ credentials.

But for the CMA, it’s a case of weighing up whether stabilising the market today would eventually create a market imbalance tomorrow. Currently, VMO2 and BT/EE are benefitting from mobile and fibre bundling. A sticky proposition in a market that needs to retain customers to survive. Of course, these brands achieve it with their own infrastructure.

Sky, on the other hand, is performing extremely well in the market without the network overhead. Many forget this. But not Vodafone. It says Sky’s impressive customer base and market power is a cause for concern.

I’m not sold on this as an argument, but I do agree that Sky has logged some very impressive growth in a relatively short time.

There’s also the buoyant MVNO market, ready to snap at the heels of change. If phase 2 concludes in favour of a merger, then the publicity alone could prompt consumers to rethink their provider and look at the smaller more innovative brands. Add to this the teething problems all brands inevitably go through when they merge and consumers could be persuaded to leave either brand for a better deal, and better service, elsewhere.

That said, there’s also opportunity – I can see the likelihood that a merger would encourage more MVNOs to spring up. Largely, because there will be capacity to fill, and Vodafone will want to put the wounds of losing Virgin behind it and build credibility again. There could be some exciting deals to be done for any MVNO that wants to renegotiate terms or has intentions to start up. That’s another reason for the merger, as it could give rise to more equable MNVO shares across the market.

Overall, I’d say there’s more to rule in favour of the merger than against it. But of course, this is all pie in the sky until phase 2 concludes. And there will be firm warnings to anyone counting their chickens before they hatch. The CMA will follow a strict process and woe betide any party getting ahead of it.

As an outsider looking on, I’m prepared to sit on the fence for now. But if you really pressed me for an outcome, it will be that at the end of phase 2 the CMA waves the merger through.

The post Phase 2 is highly likely in the Three / Vodafone Merger story. The CMA has nothing to lose at this stage. appeared first on Graystone Strategy.

For instance, the prospect of market consolidation in the UK mobile market, represents a seismic shift. MVNOs are already using this as a chance to review their strategy and seek out new opportunities and advantages.

Similarly, in markets issuing new licenses, there’s a chance for the application providers delivering billing or customer service platforms to grow their brand and assert their capability by becoming integral to the go-to-market strategy.

Of course, some brands have cause for concern in times of change. Digital start-ups are eating up market share and

leaving legacy providers in their dust. It’s a case of transform or die.

Yet, for all of these companies, it’s hard to communicate their value in a new world. It’s often not a skill-set they boast, and, as we’ve discovered, not something they have done for a long time. And why would it be if their brand has not experienced the urgency of competing in more dynamic economies, or at such high levels?

Prior to working with us, many have tried to identify the message they need to take to market. But it never gels. Usually because the proposed messaging has come from an internal view of the world. It’s clouded by what people believe to be true, and a mix of opinions that are not always consistent.

It can lead to a short sighted approach with little longevity in terms of how it will support the goals set out in the company strategy. And that’s if there is a strategy that reflects the changing dynamics.

It’s generally at this point that leaders have to accept they won’t arrive at messaging that will cut through, because the strategy is no longer fit for purpose. You can’t lead a company into change if the message you want to convey does not align with what you do and how you do it.

Messaging needs to come from insight. You must know your customers and prospects inside out, and ensure the messaging not only reflects what’s happening today but the direction the market is going. How will you serve those needs? What’s the gap? Can you do it alone? Do you need partners? What will you be famous for?

This makes messaging a cultural exercise as much as anything else. Amazon is clear that if you want to be the largest e-commerce platform in the world, you need people who are willing to take risks, fail, learn and thrive.

Are your people up to the job? Are they capable of meeting the demands of the company’s new strategy? Are they measured on objectives that achieve the strategic goal? Are they supported to become visionary? Are their behaviours a reflection of the company values?

As we start to work with leaders, it becomes clear to them that unless they understand the fabric of their company and how it translates to the market, they can’t address the company message.

That’s a brilliant outcome, albeit for some, unexpected. Having the bravery to accept strategy and messaging are intertwined, allows leaders to take great strides towards realising the ambition.

They can get the right team and skills in place. Focus on partnerships that drive the strategy. Adopt processes that underpin the company ethos and values. Build products and services that meet the customers’ needs and deliver marketing that drives the market demand.

We know, because we’ve got the clients to prove it.

If you find yourself leading a company through crossroads of change, then speak to us about how we can help you devise and deliver your plan.

The post When the market shifts, is repositioning your brand the answer? appeared first on Graystone Strategy.

The NCC’s commissioner Prof Umar Danbatta, has been reported as saying the licences, that each run for a period of ten years, are a crucial part of keeping up to date with industry developments and support ambition to roll out 5G, as well as introduce more competition and opportunity to run telcos in the fixed, M2M, B2B and rural sectors. Wholesale is also seen as a means to help balance the revenue loss that incumbents have experienced as more OTT players take a share of the pie.

As you’d expect with an MVNO model, the new MVNOs will use the networks of the existing operators, namely MTN, Globacom, Airtel and 9mobile.

Challenge brings opportunity

The challenges with such a vast country both in terms of land mass and geography, in particular the challenges of supporting mobile in outlying areas, are significant. The scale of the customer numbers also adds a further dimension.

However, it’s my opinion that there are enormous opportunities too. In fact, we advised numerous potential MVNOs in the run up to the process and submitted a report to the commission summarising the scale of the market opportunities, and the conditions that create a buoyant sector.

Every MVNO will be different addressing these varied challenges, offering services to different segments and regions. Vertical markets will also be targets – oil, tourism, and agriculture all present options for specific propositions. These propositions will include the deployment of private networks at large campus-based operations such as ports through to eSIM for tourists, and IoT / M2M solutions for heavy industry and agriculture.

All the licence applicants had a choice about how they wanted to run their MVNO and the technical investment they were prepared to make. The tiered system of licensing reflects this.

Licence tiers:

The licences are divided into five tiers, each one defined by the services and technology set up of the MVNOs. The specific definitions from the regulator are as follows

Tier 1: An MVNO within this tier leverages on its ability to offer services to its customers without owning any switching or intelligent network infrastructure. They do not control any numbering resources. Responsibilities lie with the host Licensee to provide wholesale capacity to the V.O for delivery of its products and services.

Tier 2: An MVNO within this tier assumes more control of the value chain which allows it to significantly differentiate itself from its host. The VO does not have Core Switching and Interconnect capabilities but can set up its own Intelligent network (IN) to provide their own IN services to the customer. It can own more of the customer segment than Tier-1 operators with the capacity of establishing its own Home Subscriber Register or Authentication centre, Equipment Identity Register, and Home Location Register, if it desires to.

Tier 3: Within this tier, an operator relies on its technical and commercial prowess to launch and operate a full core network with switching and interconnect capabilities. The VO relies totally on its host to provide Radio Access capacity at wholesale to deliver its products and services to its customers. The MVNOO can engage in interconnect agreements with other network providers. Revenue generation stems from both outbound and inbound calls which gives it full control over its tariff structure.

Tier 4: The operator within this tier is responsible for aggregating and/or Enabling MVNO services within the market. It relies on a model in which it stands as a middleman between the MNO and multiple MVNOs. The aggregator is responsible for purchasing bulk capacity from a licensed network operator, and reselling it to multiple MVNOs, therefore streamlining the process of negotiating capacity agreements with said network operators. The aggregator is permitted to choose what level of the value chain it desires to aggregate.

Tier 5: Unified Virtual Operator. In the simplest terms, an MVNO within this tier can decide the level of service it desires to offer ranging from Tier – 1 to Tier – 4. This gives the MVNO freedom of choice to deploy its services the way it deems fit if it still has a valid license. They can engage in “Shared Rural Coverage Agreement” within underserved and unserved regions.

𝗧𝗵𝗲 𝗰𝗼𝗺𝗽𝗮𝗻𝗶𝗲𝘀 𝗮𝘄𝗮𝗿𝗱𝗲𝗱 𝗠𝗩𝗡𝗢 𝗹𝗶𝗰𝗲𝗻𝘀𝗲 𝗶𝗻 𝗡𝗶𝗴𝗲𝗿𝗶𝗮

Tier 1

• Topit Virtual solutions Ltd

Tier 2 (Nine Companies)

• Routelink Integrated Systems Ltd
• Hazon Technologies Limited
• Asel Telecom Nigeria Limited
• Briclinks Africa Plc
• Pisi Mobile Services Limited
• Univasa Nigeria Limited
• Imose Technologies Limited
• Infratel Limited
• Telconix Networks Limited

Tier 3 (Seven companies)

• Amics Technologies Limited
• Zegtel Limited
• Telewyz Limited
• Siu Telecommunications Network
• Abrindex Nigeria Limited
• Metropolitan Consortium Nigeria Ltd
• IPNX Nigeria Limited

Tier 4 (Four companies)

• Imbil Telecoms Solutions Nig. Ltd
• Environmental Expressions Limited
• DMK Telecommunication Nig. Ltd
• Holla Tags Limited

Tier 5 (Ten companies)

• Systegra Technologies Limited
• Choffan Communications Limited
• Mab Consultant and Associates Ltd
• H & Y Business Global Limited
• Taima Technologies Ltd
• Global Communication Extension Services Ltd
• USK (S) Ventures International Ltd
• Paribas Communication Limited
• Fourth Industrial Skills Consult Limited
• Mobilise Communication Ltd

It’s very interesting to see that the majority of licensees have opted for the flexibility of the Tier 5 licence, or the opportunity afforded by a Tier 4 MVNA licence. With only four host networks and over 30 MVNOs to enable, it’s likely that those with an MVNA licence will be in strong position to enable on behalf of network operators keen to outsource the complexity of running multiple MVNO relationships.

It’s an extremely exciting time for this market, and there will be opportunities not just for the MVNOs, but also for parallel industries, including data insight, billing, marketing, and mobile application providers.

If you are one of the MVNOs licensees that wants to out compete the market from day one, or you’d like to understand how your application business can get in on the act, then get in touch to find out how Graystone Strategy’s MVNO launch expertise can help you achieve success. Our blog on “The five MUST DO actions Nigeria’s new MVNO licensees should take for a successful launch” must do to deliver a successful go to market launch is useful further reading.

The post Nigeria’s newest mobile licensees have a big opportunity to change the telecoms market appeared first on Graystone Strategy.

Rather than second guess the market, the CMO commissions a large-scale quantitative study to help understand how core personas in a variety of target segments take decisions at key stages of the buyer process.

It might be the only time in the annual planning cycle that the CMO gets the chance to take the pulse of market sentiment, so they are keen to maximise the value the company can get from the research.

Having agreed the research objectives, audience and methodology, the next step is to agree the questionnaire. And it’s here that for some CMOs the wheels can start to fall off, all be it often unwittingly.

MISTAKE #1 – TELLING THE RESEARCHER WHAT QUESTIONS TO ASK

It’s surprising how many times clients approach researchers with a list of fully fleshed questions they want to put to their market.

Quite often they do it with a sincere wish to be helpful, or to save time but it can often be counterproductive.

Think of it like this; you wouldn’t hire an expert ad agency to run an ad on TV that you’d filmed yourself, would you?

How to avoid mistake #1

Provide the researcher with the business context in which you are commissioning the research.

Don’t pre-judge what questions you think you should be asking. Tell the researcher what it is you want to find out, from whom, why, and what you will do with the information when the results come in.

Be clear about what you need to find out but leave the writing of the actual questions to the researcher.

A good researcher well-versed in your business context should be able to craft a succinct questionnaire that intelligently draws out the themes you wish to explore and give you the answers you need.

They will structure it logically, phrase questions in a way that maintains the respondents’ engagement and avoid asking questions that lead to respondent bias.

In return, you should get genuine insights that help to drive your business forward, rather than a set of numbers that simply confirm existing prejudices within your business.

MISTAKE #2 – ASKING TOO MANY QUESTIONS

As we’ve said, the research being commissioned will likely be the only opportunity the CMO gets to gain a window on their customers’ world. This is true in B2B, where research budgets can be much more restrictive than in the B2C world.

This brings with it a huge temptation to ask as many questions as possible to wring every last drop of value from the project.

Paradoxically, this too can be counterproductive (though for some reason not all agencies seem to be keen for their clients to understand why.)

The reason is to do with the mechanics of quantitative research.

Sad to say, but a fact nonetheless, most respondents taking part in a quantitative survey are far less interested in the outcome than the marketers that commission the research, even if the respondents are incentivised.

This means that researchers and their clients can’t expect participants to commit to giving their undivided attention and full consideration to every question.

You only have to listen to a respondent being taken though a lengthy, directionless questionnaire to sense the increasing frustration at how long the process is taking. The disinterest in their voice rises as their concentration diminishes, and the thought they give to answering each question consequently declines with each passing minute. The value that could be gained from asking the questions simply slides away.

It can get even worse with questionnaires that are completed online. Within a remarkably short time, respondents can get bored and start to click on random answers just to get to the end.

Expert researchers can generally spot the point at which this starts happening as the  response data starts to get flatter and flatter. But what they can’t do is filter out the respondents that were genuinely paying attention versus the ones that got bored.

As a result, the client is left with results to multiple questions that are inconsequential or, worse still, unreliable, contradictory or misleading.

How to avoid mistake #2

In B2B research, a good researcher, given a solid brief, should be able to construct a meaningful quantitative survey of 15 questions that gets to the nub of the client’s core issues and takes no more than 15 minutes to complete.

(To be clear, a question that gives six statements and asks a respondent to review each in turn and indicate to what extent they agree or disagree with each would count as a single question.)

Choosing your questions wisely and keeping your questions crisp has the added advantage of speeding the rate of data collection. That’s because the longer the questionnaire, the greater the drop off in completion rates. Therefore, the more respondents the researcher approaches to complete the questionnaire, the longer it takes to get a quorate number of responses. (It’s for this reason that shorter questionnaires tend to cost less to put into field, by the way).

This is particularly important in B2B research if the personas you wish to survey are relatively niche. High respondent drop-off is less of an issue if you are researching UK households who buy mayonnaise, for example. If some respondents drop out, there’s probably another 20 million households you could go out to.

But if you need to survey Procurement Directors in the UK telco infrastructure supply chain, there may only be a respondent universe of a few hundred people qualified to answer your questions. It’s therefore imperative they remain engaged throughout the process.

MISTAKE #3 – EXPECTING THE RESPONDENT TO DO ALL THE THINKING

When devising multi-answer questions, it’s always tempting to add a catch all “Other (please write in)” response option.

The thinking is straightforward enough: “We may have missed something important – the respondents will tell us if this is the case”.

However, most clients are disappointed in how few respondents bother to complete the “Other” box.

As we’ve already explained, respondents’ commitment to completing the questionnaire can fall frustratingly short of the client’s commitment to uncovering the answers they need. So questions that ask respondents to think and type for themselves tend to be given less thought than questions where the answer range has already been thought through for the respondent to consider.

Not only that, having a question with an open answer field option creates a challenge in accurately interpreting the answers. That’s because this kind of question ends up blending prompted and unprompted answer sets in the same question. Consider it this way; had any relevant “please write in” answer been included in the original answer set, would more respondents have chosen that option as an answer?

How to avoid mistake #3

The best way to mitigate this outcome is to do some qualitative interviews with your core audience prior to constructing the quantitative questionnaire. A skilled interviewer can then use the insight to tease out what the most likely answer set will be for a quant questionnaire.

The second-best way to approach the problem is to pilot the questionnaire with a relatively small sample of respondents prior to rolling out the full survey. This is good practice in any case as it can help show up unanticipated flaws in the questionnaire logic or help reveal where an unintentionally ambiguously worded question is throwing up some bizarre answers.

By reviewing where pilot respondents have completed any “Please write in” answers, the client and researcher can decide whether these extra answers are sufficiently insightful to be included in the prompted answer set when the questionnaire is rolled out.

Though it’s worth noting that even doing this can distort the validity of the final data. That is unless the pilot respondents’ answers are disregarded and then replaced with an equivalent cohort of additional respondents, ie all final respondents see the same answer set.

In summary, if you are thinking of commissioning market research:

• The best research briefs inform the researcher what the client needs to find out, not what questions need to be asked.
• The best questionnaires are crisp and engaging. Remember that over a certain boredom threshold, the more questions asked, the less reliable the answers will be to the later questions, and the more contradictory the data.
• It’s always wise to do some qual research prior to running the quant, even if it’s only amongst four or five subject matter experts. It’ll tease out angles that neither the client nor the researcher have anticipated and ultimately lead to better insights.

If you need help shaping your research strategy, we can help just contact us.

The post The 3 key mistakes marketers make when commissioning quantitative research – and how to avoid them appeared first on Graystone Strategy.

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…..

The post Carphone Warehouse, death by a thousand cuts appeared first on Graystone Strategy.

The answer is reasonably clear cut in my mind – quite simply, mature mobile markets are a problem for operators, especially when the economy has been battered and this strategy helps to overcome the associated problems.

There is always going to be a limit to the number of customers you can attract from segments outside of the core customer profile if you haven’t got the right brand appeal. And right now, though consumers value telecoms and app, they are still keen to save money making for tougher competitive dynamics than normal.

Getting back to the question then, ‘why bother launching a sub brand now?’, you have to look at what’s going on irrespective of the current pressures. Rewind a couple of years and Vodafone launched Voxi in the UK to appeal to a market that its own brand couldn’t reach.

Indeed, Voxi is designed to solve a very specific problem –  how to get your arms around a youth segment that usually considers the Vodafone brand as irrelevant. Voxi is the answer providing a vehicle to address the audience without diluting the value of its master brand.

Remember that in the UK, Voxi is not the only sub brand that Vodafone has access to. Vodafone also has Talk Mobile, a former MVNO that it acquired from Carphone Warehouse, which allows it to access additional market segments.

But in Ireland, where the overall market subscription size is 5milllion and there are fewer MVNOs compared to other markets, Vodafone’s had to take a very different approach and launch Clear Mobile.

Clear Mobile offers calls, texts and unlimited data for €12.99 per month without a contract. This deal works out at less than half the price of Vodafone’s own similar monthly tariffs and is bound to spark what the press refers to as a ‘price war’ on the lower end of the market.

But as is so often the case, you need to lift the bonnet on the headlines. While Clear Mobile offers unlimited data, it’s been able to discount it to the rate it has because the data speeds are much reduced.

It’s therefore built on a calculated premise – Voxi won’t work in Ireland. Clear Mobile is clearly not one for the kids – as Voxi is – and much more likely to appeal to value conscious “settled seniors”. Vodafone has identified a segment it can compete in, and address the discounting war at the same time. The overall brand strategy is a good example of applying multiple sub brands to deliver the same gains – Voxi aimed at the youth segment, while Clear is aimed at the opposite end.

And at the moment I’d say it’s more important than ever to adopt the right model. You need to read the market and ensure the money you invest pays dividends.

Why? Well, let’s get back to basics: economics drive the mobile market. The more customers you have using your network the better the revenues and profits. With a sub brand there are no wholesale costs and every penny of the margin is banked.

What’s more, the parent network can trade on the credibility of it’s brand, control the segments that the sub brand targets and most importantly influence its pricing and offers to ensure it’s not competing head to head.

That’s why the approach Vodafone is taking makes sense. It gives Vodafone more control over the offers it puts into the market and the segments it pursues with those offers.

Of course, parent brands have to put a lot of faith in the power of it’s brand to drive the success of the sub brand. And to be blunt, that’s not enough to attract customers, in fact it could actually detract from its appeal.

Brand awareness is therefore vital to ensure sub brands feature on the list of operators people consider. But that doesn’t come cheap. Millions are spent every month by operators persuading us to switch, stick and/or buy more. Releasing funds to do it for another brand isn’t going to be easy for a CFO and many will be looking to other distribution channels to ease the financial burden.

But even they cost money to set up and maintain. It’s a fine balance and so entering the market with a sub brand is a massive strategic decision.

The outlook for sub brands and MVNOs

There are still brands out there that would make very appealing MVNO partners that would fit a multi-brand strategy. With the right model, there’s much to gain and I expect we will see some high street brands seriously consider mobile as a way to generate a recurring revenue.

That said, I do expect some MVNOs to find it tough in the next few years as Brexit and the long term economic consequences of the pandemic exert real pressure on business models and people’s pockets. Some MVNOs will survive, some will merge, some will fold.

Operators will feel this, and those that have MVNO brands that are grossly affected will have to ensure the hole in their finances is plugged. Sub brands are likely to be the answer but they have to be built on a proposition that will appeal to a specific target segment. It’s too big a gamble not to, plus if they fail to do their homework then they ultimately fail their customers and their shareholders.

The post Are sub brands the way to go as operators grapple with changes to consumer behaviour? appeared first on Graystone Strategy.

So, as you can imagine I found the Mobile News’ headline ‘Three CEO Robert Finnegan: ‘The UK market is dysfunctional’ pretty thought provoking.

Looking back, it’s not the first time Robert has said something like this. Since taking up the helm he has clearly picked up clues that others haven’t and it made me delve under the bonnet.

If we look at this in purely economic terms, the term ‘market’ means the exchange of goods and services that takes place as a result of buyers and sellers being in contact with one another, either directly or through mediating agents or institutions.

This means a dysfunctional market would be devoid of the processes that allows for an exchange of goods.

Clearly that is not the case. We have a wide and disparate market in telecoms with a significant range of sellers, which encourage competition, another attribute of a healthy self-regulating market.

In fact, for the buyers of telecoms and particularly mobile services, the UK is a very competitive market. OFCOM research shows that the UK is the cheapest when compared to four other markets including France, Spain, Italy and Germany, even though they all have declining costs of ownership.

Over recent years, UK mobile owners have enjoyed a 19% reduction in prices and an average of 146% increase in data use. This has been driven by aggressive consumer pricing and all you can eat bundles, funnily enough spearheaded by Three. (Three customers use about seven times the data of a market average consumer.)

So, what’s dysfunctional about it? Is it this discounting that is the problem?

Certainly, in a saturated market such as the UK, increasing use and decreasing value will drive operators to investigate other sources of revenue. Whether that is bundling in extra premium services such as Netflix, Disney or Spotify, or focussing on higher volume incremental growth such as IoT connections.

I wonder then if for Three the challenge that is really presenting itself is that until very recently it has disproportionately focused on the consumer market making it difficult to secure a foothold in the large and more stable enterprise and business markets.

Though it has to be said that this is changing. Three announced its latest SME tariff offering of 10 business subscriptions for just £20. It’s a move that is going to really shake up pricing in the enterprise market and I can only imagine it will be viewed with a certain amount of disapproval by BT, Vodafone and O2.

There’s no arguing it’s a great deal but I suspect analysts will be asking ‘does Three have the extensive products and services required to really tackle the business market?’.

It’s fair to ask. Three has suffered from disappointing results when it comes to coverage, recently coming last or third on all the metrics from the recent Opensignal report. For business buyers coverage is the number one hygiene factor so it’s a perceived weakness that has to be addressed quickly.

Secondly, even the smallest companies are now looking for flexible, fixed mobile converged products and a trusted all round telecoms and IT partner. Three is just not there yet, though there is most definitely potential to look at some of the recent hires.

There’s also a bit more colour to add to the picture. Mr Finnegan hasn’t shied away from talking about consolidation and for Three that can mean only a few things: 1. a merger to gain economies of scale, and Three has some impressive spectrum assets to make it more appealing to a largely complimentary customer base for a buyer like Vodafone , or 2. an acquisition or merger with an organisation that can accelerate Three’s access to fixed and converged assets and give it increased credibility in the business markets through a broader more appealing offer, especially for more cautious business buyers. You can read more about our thoughts on this here.

It has to be noted that this would in all likelihood diminish competition in the market sense. But it would set up Three to be a full suite competitive challenger brand for all the networks.

And why not? We would do well to recall that Three merged with O2 in Ireland and was able to make that leap from fourth player consumer brand to number two in the market with a strong enterprise proposition, albeit in a much smaller market.

But whether you agree that the market is ‘dysfunctional’, you dispute the notion entirely, or you’re happy to sit on the fence and look at all competitive disruption from Three and MVNOs as a positive, there’s no doubt that it all makes for exciting headlines. And frankly it shows that as we leave this disaster of a year behind us it won’t be long before we have more exciting headlines to debate.

If this has made you question your strategy for the year ahead, then I’d be happy to walk you through my approach to summing up change and anticipating market moves so you can set out on the right course in 2021.

The post Is it right for Three to ‘dis’ the UK telecoms market? appeared first on Graystone Strategy.

TEAM

It’s been said a million times before, engage your team and they will engage your customers. Now like never before this should be your number one focus over the next 100 days of trading. If you are banking on a Christmas windfall then you must start here.

Store teams are on the frontline in these unprecedented times. They are frightened, overawed and confused. They may feel exposed. And the same is true of customers. So how do you ensure that store teams feel supported, engaged and motivated so that they can deliver an extraordinary experience in these extraordinary times? Four things that must be in place. If it’s not your forte get someone in who can help you. It’s a very worthwhile investment.

• Communication – regular, clear and accurate. Get into a rhythm of sharing updates and helping people feel confident and supported, with opportunities to ask questions and get honest answers.
• Establish easy to use help lines. I’ve seen the power of this. Ones that are manned every hour the stores are open provides a sense of ‘we are all in this together, there for one another’.
• Lead from the front. If you can change work from home to work from store some of the time then do. You’ll need to look at the practicalities, but if your teams are prepared to do it, then so must the management team.
• Motivate, excite, engage. Just because this year is different it doesn’t need to be full of dread. Be creative, make retail fun – there are so many brilliant people out there who can help you achieve this. Get it right and it will be infectious, customers will value it.

IN STORE

Understandably there are wide ranging ‘rules’ that have been introduced across all of retail. Some imposed, like masks and 2 metre distancing, some unique to brands, from whether you can or can’t try on/touch something, and whether it would be quarantined afterwards, to the number of people in a store etc etc.

It can be confusing for customers and turn them away. So help customers to feel comfortable:

• Keep it simple. Strip back and have as few rules as possible so that customers understand what they have to do.
• Make space. Are there non-essential products and fixtures that could be removed, would signage to say they are available on request be a better alternative so your high margin, high turnover items are always available?
• Windows. They are more important than ever in bringing alive what customers will find in store and a brilliant way to inject some theatre into your brand and stand out.
• Innovative services. Where are your pinch points and where do they overlap with the customer’s concerns? For example, can customers book an appointment with a store member in advance of visiting so they get what they need quickly? What other services can you offer – gift wrap and delivery from store after your purchase. Secret Santa or office parties ‘at home’ kits could be a winner now.

DIGITAL

Gifting is what the next 100 days are all about so do everything you can to be front of mind:

• Transforming your entire digital experience may not be possible right now but there are smaller changes you can make that will have a big impact – is the menu and layout easy to navigate? Is it fast to load pages, do images have ‘wow’ impact, how many clicks do I have to make to get from home to checkout via a purchase? Get these right as soon as possible.
• Is the site optimised for mobile? Such a win-win that I still can’t believe how few retailers have it in place.
• Are you always ‘on’? Web, social media, chat… we have to approach digital as we do stores. When customers come ‘in’ they should be engaged and inspired from the first click. This is going to be a huge area of emphasis. People will browse and possibly never make it to store, converting them is essential.
• Are you translating all of the normal seasonal experiences onto digital? Skinning digital platforms so they have seasonal impact is so important. You need to create that digital winter wonderland. But don’t stop there, what about trick or treat? Ultimately think about how you help people enjoy winter events at home this year.
• How do you ensure customers still browse? Can you use pop ups for suggested ‘add ons’? Could you create a gift market on the home page? Could you design a digital version of the Christmas shop where customers are able to virtually walk through the store and make selections?
• Finally, but most importantly, is the operation robust? From selection to warehousing to delivery it’s absolutely essential you build in the capacity now so you can deliver on a memorable customer experience people will recommend.

The next 100 days will be different, but brands have an unbelievable chance to do something completely new, engaging and exciting for customers. If you need help developing your strategy then speak to us. We’ve developed successful, award winning marketing campaigns for retailers around the world.

The post The next 100 days will be the toughest ever for retailers. How can brands stand up to the test? Peter Scott our head of retail consultancy takes a look appeared first on Graystone Strategy.

I follow Asda closely – like a teacher likes to hear how a pupil succeeds in later life, I like to know how the brands I helped launch grow.

I was aware that Asda was reviewing its options and commercials but considering how poorly the move from Vodafone to EE went some years back, I was, to say the least, surprised by this return.

I’ve already been asked what I think is really going on, and I see a few possibilities here.

Asda has always struggled to grow to a size that befits the size of its retail business. Part of this can be attributed to its prepay only offer, but more recently it’s a symptom of a declining market now representing only 28% of all mobile subscribers. When it originally launched in 2007 it was almost double that.

Asda has also struggled to link Asda Mobile intrinsically to the grocery shopping experience. Sainsburys, which I also launched for Vodafone, did it through the Nectar scheme rewarding mobile customers with double points on their groceries. Tesco has done a similar thing and continues to link the categories it owns.

So why go to Vodafone, what materially changes? Well, what I hope to see is some exciting SIMO post pay propositions coming to market. There were hints of ‘digital experience’ in the announcement, and so we might see some innovative ways of linking the value you give in one category to another. It’s this sort of innovation that makes Vodafone attractive.

However, there is one major hurdle – migration. This can be painful at the best of times. Asda customers will have to do a SIM swap and that’s no mean feat on a prepay MVNO where Asda won’t have all the customer details.

It’s also likely to trigger some sizing up by customers. People are highly likely to re-evaluate the service they get and consider the other options. There are some great deals out there right now and Vodafone’s VOXI will be a big competitor.

Coverage is also likely to be a point of consideration. Customers who have coverage on the EE network won’t necessarily get it on the Vodafone network. That’s just the challenge of mobile coverage. This too will cause churn.The upshot is that if they manage to only lose 20% of the base in the migration they will have done EXTREMELY well.

Of course, an announcement like this doesn’t stand alone. There will be ripples. EE/BT, has so far ‘played 3, lost 2 won 1’. It lost its biggest wholesale customer Virgin to Vodafone, (who is then likely to lose it due to the proposed Virgin merger with O2 , then it won a five year extension of Utility Warehouse, but losing Asda will be a blow. Just goes to show you can’t ever rest in this business.

Overall, it drives a lot of work for EE/BT as it will need to put in place a team to support the mass migration of the two MVNOs. It could definitely be a distraction from winning new ones.

Overall, I expect to see yet more movement in MVNO wholesale deals. There are a few more out there to compete for. The prize that may just be up for grabs is Sky, triggered by the O2 and Virgin JV. It’s not beyond the realms of possibility, so I will be staying glued. And it’s probably enough of a reason for anyone else in mobile to stay tuned too.

If this shakes up your plans and you think renegotiation is likely then get in touch. We can help you understand the games being played and the moves you can make.

The post Asda Mobile goes back to where it all started. What can Vodafone deliver for the brand? appeared first on Graystone Strategy.