With 1997 drawing to a close, the paging industry is readying itself to go out with a bang.
Whether the achievement of the carrier, reseller or distributor, fourth-quarter sales traditionally count for an average of about 40 percent of the paging industry’s annual revenue, in no small part due to holiday shopping. As such, consumers can expect a number of promotions and new services to vie for their attention, from various sources.
If money talks, then advertising spending speaks volumes to the importance of fourth-quarter sales. According to an advertising tracking study conducted by Competitive Media Reporting in New York, the paging industry on average spent more on advertising in the months of November and December last year than it did during other months.
For instance, Mobile Telecommunication Technologies Inc. spent an average of $625,000 a month from January to October last year advertising its SkyTel service. But in November and December, the company spent close to $2 million a month.
In the same time period, Paging Network Inc. averaged $333,000 a month in advertising spending, which jumped to $1 million in November and December. American Paging Inc. spent all $900,000 of its advertising budget during the last two months of the year.
Despite these figures, some industry analysts believe the major holiday promotional push for paging will come from retailers, not carriers.
“I would expect more marketing at the retailer-distributor level,” said John Zahurancik, analyst at The Strategis Group. “Paging hasn’t really been a holiday-oriented product. It’s not necessarily been promoted as a gift item,” by the carriers. According to Zahurancik, 10 percent of paging users say they received their pagers as some form of gift, be it holiday-oriented or otherwise. If anything, paging products and services have been promoted more as a summertime fashion item than a holiday gift, he said.
But that may be changing due to the increased focus on retail distribution and the growing clout of the consumer market, he said. According to a Strategis Group study called “PageTrac ’97: Consumer Trends in Paging,” the consumer market has overtaken the business market as the biggest portion of the paging-user pie.
In the past five years, the personal user market jumped from 23 percent of total paging users in 1993 to 46 percent in 1997, from 4 million users to 21 million. In contrast, the business-user market grew from 9.3 million to 12.5 million in the same time period. With 70 percent of new paging users saying they signed up for personal reasons, according to the study, the consumer market could continue to overshadow business users in the future.
These figures, Zahurancik said, may foretell a shift in marketing strategy. “I wouldn’t be surprised if we began to see more seasonality in their marketing,” he said. “I just haven’t seen anybody doing it yet.”
Besides the target of the promotions, the nature of promotions also is expected to change. Jeanine Oburchay at Bear, Stearns & Co. said in past years, paging promotions have been based on price, offering lower service prices or lower activation fees, something she expects to change as the industry moves away from price-based competition and more toward value-added services.
“There’s going be a difference this year than in years’ past,” she said. “I don’t think you’re going to see as many promotions based on pricing this year.”
Predictions aside, several new developments in the paging industry this last month have added to the spate of potential gifts. Conxus Communications Inc. launched its Pocketalk voice paging service in mid-November. The company is the second paging provider to employ Motorola Inc.’s InFLEXion voice paging protocol and is currently offering the service in the Washington D.C./Baltimore area and in the south Florida cities of Miami, Fort Lauderdale and West Palm Beach. It uses the Motorola Tenor voice pager.
Also making an appearance is the MTV Network, aimed at the young adult consumer market by partners Nationwide Network Services Inc., MTV: Music Television and Motorola. Motorola designed a special line of pagers with the MTV logo that hit select retail outlets and music stores nationwide earlier in November. Airtime for the nationwide network is being provided by Paging Network, resold by Nationwide Network Services.
Promotions for the network include a chance to win a trip for two to Los Angeles to attend the movie premiere of Scream II. Other promotional prizes include a tour of the MTV studios in New York, a Beavis & Butt-head snowboard, free CDs and a free paging service for a year.
Apart from network launches, some carriers have created holiday-oriented promotions themselves. Metrocall Inc. is advertising a gift promotion to its current customers in billing statements, enticing them to sign up a friend for the same service.
AirTouch Paging is offering free prepaid calling cards good for 15 minutes of free airtime as a gift for every pager order received through participating J.C. Penny stores. The company also is offering West Coast customers a month of free voice mail and a free paging accessory for new subscribers purchasing service before Dec. 25.
