The harmonious relationship between wireless technology and the Internet is making monumental advances in communication, but the rate at which consumers are taking advantage of both is lagging a little behind.
To accelerate the current e-commerce frenzy and entice customers into buying more, more often, wireless carriers and online retailers are beefing up their Web sites and testing the limits of one of the most appealing and effective marketing tools to date.
“Our strategy is that we want to provide consumers … with the freedom of choice and a place where they can make a purchase. We offer to our consumers the most popular pricing plans and handsets online,” said Peters Suh, vice president of information services for AirTouch Communications Inc. in San Francisco.
AirTouch launched its Web site two years ago and now “the online store is the equivalent to 15 to 20 of our retail stores in terms of sales,” said Suh.
“The site started out with a prepaid or phone-in-the-box, but we quickly learned you have to offer the complete suite of products and services.”
AirTouch’s discovery in the mostly uncharted waters of Internet wireless product marketing is an important one for both carriers and the bevy of newly created online dealers such as decide.com and Telstreet.com, according to Elliott Hamilton, senior vice president and director of global wireless at the Washington, D.C.-based research firm, The Strategis Group.
“The real key to success is they have to make the site as valuable as they can to the consumer. They have to have pricing, coverage and really be a one-stop source for information,” Hamilton said.
Wireless product Web sites have to compete with wireless phone stores and electronics stores-the most popular points of purchase-for business. In both cases, consumers are able to hold and use the phone before purchasing it, which can be reassuring for an intimidated first-time buyer.
A survey conducted last year by The Strategis Group on potential wireless users found 78 percent said they would buy their wireless products from a specialty wireless store, while only 16 percent said they would make purchases through the Internet.
When The Strategis Group looked at where people actually bought their wireless phones, it found 29 percent made their purchases at a specialty wireless store, while only 2 percent went online.
“Some Internet sites will direct you to stores. A lot of the time you will enter your zip code and then … Motorola (Inc.) tells you about the stores near you,” Hamilton said. “Many people are using the Internet for information and then walking into a store.”
Other points of purchase noted in the survey included carriers, car dealerships and the workplace-all preferred over the Internet.
At least eight companies-all launched within the past year-offer comparison information on more than 1,000 rate plans from carriers across the nation, as well as handsets from popular manufacturers like Motorola and Nokia Corp.
One company, decide.com, is trying to make strides to improve wireless shopping on the Web. Launched in October, decide.com helps consumers compare and contrast the essential elements of a wireless package, including the cost of the plan, the coverage/quality of service and the handset, said Krishman Natarajan, vice president of content for decide.com.
Among other features, decide.com offers a 3-D view and full-size printout of the available handsets so users can see the actual size of the phone. The site also allows users to listen to the call quality of each carrier in the users’ home calling area.
The holidays provided an ideal testing ground for all online merchants, and Natarajan said carriers and dealers experienced few problems, but inventory shortages-especially of the more popular handsets-have occurred.
While consumers adjust to the idea of purchasing products online, online merchants need to focus on “developing relationships with new customers and securing long-term relationships,” said Ken Cassas, analyst with Jupiter Communications Inc.’s Digital Commerce Strategies research practice, which conducted a consumer satisfaction survey of online holiday shopping.
The boom of companies such as decide.com mirrors the boom in wireless sales, and speaks to an audience of eager buyers.
“There’s no need for demand creation, the market is there,” said Natarajan. “We’re just trying to provide a more information-rich medium.”
Natarajan’s belief that there is a high amount of overlap between people who have cellular phones and those who use the Internet also is helping online sales of wireless products, but buying over the Internet is an “acquired behavior,” he said. “Online retailing for wireless products and services is still very much in the early market. It’s not mainstream yet.”
