DALLAS-While admitting the growth of wireless communications is unbridled, challenges still lie ahead for the industry, particularly when it comes to marketing.
Speaking at the recent Wireless Marketing Summit, co-sponsored by RCR Publications Inc., Lynn Upshaw, principal of Upshaw & Associates, listed some of the hurdles carriers will have to overcome in the age of competition to succeed, including: funding; technical obstacles like siting, handset design and security; bad publicity, which affects consumers who prefer an industry with smoother sailing; market saturation; psychological barriers that keep some people from trying new technology; and consumer and retailer confusion over all the “technobabble” surrounding such things as coverage and transmission quality.
To overcome some of these marketing problems, Upshaw, who is a 25-year veteran of marketing counseling, stressed that, rather than act as adversaries, wireless carriers should work together at some point to make sure everyone succeeds. “There are many winners, but few leaders,” he said. “You should concentrate on creating niches; on working on margin and not market share; and on learning to read the marketplace. Every business is unique, but every business has common patterns.”
Branding is one way wireless carriers can use to get their names out into the competitive marketplace. “A brand is a promise kept,” Upshaw said. “Names, logos and graphics are symbols of the brand. Brand building is the most profitable way to build a business.”
Robert Dotson, vice president of marketing for Western Wireless Inc., came to that company from PepsiCo. During his tenure there, consumer surveys showed that Coca Cola was the number-one soft drink in the country, with Pepsi Cola and RC Cola following behind. However, in blind taste preferences, RC Cola came out on top, with Pepsi and Coke trailing behind. “A great product alone may not be enough to meaningfully differentiate your product,” he said.
Wireless companies need to concentrate more on the benefits of their products, not the attributes, Dotson added. Emotional and functional benefits rank ahead of the technical value of personal communications services, caller ID and general services for mobile access technology.
Pricing may not even be the bottom-line issue, he said. Again citing his experience in the cola wars, Dotson said, “A price-based competitor could not sustain a long-term position, even in an expanding market.” One discount soda manufacturer, America’s Choice, could not make a dent in the Coke and Pepsi market, even though its prices were 30 percent lower. Major players will narrow the price gap and still keep the market.
Wireless buying and usage patterns are changing, and marketers need to take note. According to a soon-to-be-released Yankee Group survey, 28 percent of U.S. households own a cellular phone, up 5 percent from last year. Fourteen percent own a pager. According to Mark Lowenstein, vice president of wireless mobile communications, 4 percent of the 2,500 households surveyed said they were “definitely planning” to buy some kind of wireless device; and 12 percent said they were “seriously considering” a buy. Of those surveyed who already owned a cellular phone, 14 percent had multiple phones, and 25 percent to 30 percent said they would still use a cellular phone if they purchased a PCS phone just because of the coverage and power.
Disputing somewhat what Upshaw and Dotson presented earlier, Lowenstein said that-out of a top factor of four-price ranked 3.7, coverage ranked 2 and brand ranked 2 when it came to a person’s reasons for choosing a wireless carrier. Satisfaction with a carrier ranged from “very satisfied,” 48 percent (down from 58 percent last year); to “somewhat satisfied,” 33 percent; to “not very satisfied,” 4 percent; to “not satisfied at all,” 4 percent.
Many of the households surveyed by The Yankee Group said that wireless phones were not the status symbol that they were in the past. Phone numbers also are given out judiciously because of the absence of calling party pays in most areas.
Out of the many things a carrier could offer customers, fraud protection and nationwide coverage were what those surveyed really wanted. “There are no killer enhanced services being offered yet,” Lowenstein said. Some carriers have begun to blur the distinction between cellular and PCS, with many waiving a set contract and others increasing service areas. The migration to digital also has been accelerated.
The most remembered statement that attendees took away from the conference was one made by Western Wireless’ Dotson: “Any fool can give it away. It takes a marketer to sell it.”
