Customer retention is something every business needs to be good at. If your customer don't come back then you'll very quickly find yourself going out of business.
Visit your local coffee shop these days and you're bound to get a loyalty card. Buy 10 coffee's and get 1 free. Visit Subway and you'll get credit that goes towards buying a sandwich. Fly with an Airline and you'll get frequent flyer points. Buy your groceries at New World or buy your petrol at Shell and you'll get Fly Buys points. I don't need to list any more - I'm sure you get my drift.
Most of these companies all exist in competive marketplaces where customers have many choices when it comes to spending their hear earned money. These companies realise that keeping their customers happy is not just something you pay sparse attention to, it's part of your core business.
Now lets look at the mobile market in NZ. Stastistics tell is that 100% of NZers own a mobile phone so I'll ask a question that everybody should be able to answer. Exactly what are Vodafone or Telecom doing for you to keep you as a happy loyal customer? Do you feel that your mobile carrier really wants your business or are you simply treated as a number? Do you think they really care if you moved away to another carrier?
This poses the question - do these companies care about customer loyalty? Both feature business models based around locking you into long into term contracts and giving you small discounts off overpriced handsets. Imagine if you wanted to buy petrol but could only do this if you entered into a 24 month exclusive contract with the fuel outlet of your choice, a contract that you couldn't break without paying a penalty. In return they would sell you a 1.5l bottle of Coke dicscounted to $3.00 - more than you would pay for this product if you shopped at a supermarket. Would you feel like you were a happy, content loyal customer or would you feel like you were just a number?
New Zealand now has a greater choice when it comes to mobile with TelstraClear launching a virtual mobile network using Telecom's CDMA network and Black+White are about to launch a similair virtual network using Vodafone's network. B+W won't be offering term contracts and instead believe they can compete by offering a package that makes their customers feel like they are receiving value for money which in turn will drive customer loyalty.
So I'll now ask the question - having been a Bellsouth & now Vodafone customer for 13 years do you really value my business? What have you done recently that should make me feel happy about being a customer of yours? How have you rewarded me for my loyalty over the years? You give me significantly less airtime for my $ spend than virtually any other Vodafone Group network. You've put up roaming rates so I now have to pay more to make calls when I visit Australia 3-4 times per year and also charge all incoming roam forward calls by the minute rather than per second. This annoyed me greatly. What else have you done? Nothing. What would I like you to do? Offer me a plan that feels like I'm receiving value for money. Don't lock me into a term contract. Don't make me laugh me by offering me $50 off a $1000 handset that's selling for $200 more than it's true market value. Quite simply don't insult me. I'm happy to pay good money each month for a plan that meets my needs.
Do you really value my business or not? If you do what are you going to do for me?
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