The following is a project I worked on in university and describes what a customer might go through in the research and decision making process to purchase a phone plan with a mobile carrier. It is insightful learning how competitive advantage can make a huge difference in winning customers, and also how products are created (or SHOULD be created) to cater to a specific target market, with specific needs and wants.
All events and persons are fictional, though the comparisons of companies, services and products were accurate in 2007.
The case:
Need for a mobile handset fitting for a high-priced communication consultant based in London, U.K. Nonnegotiable specifications include tri-band frequency and SMS ability. Long battery life is also important. Price plan must include plenty of talk time and fair amount of text messages per month. Coverage in remote areas, as well as major cities around the world is essential. Most calling will be done within the U.K., followed by the rest of Europe and occasionally North America and Asia.
The method:
The CarphoneWarehouse.com Web site in the U.K. was visited to obtain pricing and handset information for various carriers. This site provides excellent comparative charts to determine which carrier will best match a client’s needs. Dealing with this company often allows for extra perks, such as free gifts, which can make the phone purchase more profitable, and fun. As well, the Vodafone.co.uk Web site was visited since The Carphone Warehouse does not appear to retail this major worldwide carrier. To determine coverage and roaming possibilities in other countries gsmworld.com was used, being the most informative, one-stop coverage detailer. This site also provides an interactive roaming-charge comparison tool, which came in handy when deciding which network carrier would be most cost efficient while making and receiving calls abroad. In addition, a visit to a mobile phone store called Optie1 was made. This retailer offers handsets and plans from various networks, however, lack of a common language made communication difficult, and thus not very productive. A coverage map to compare different networks within Europe was asked for, but out of stock at the time of the visit. However, the salesman’s advice for best coverage across Europe was to opt for the Vodafone network. Though this advice was taken into consideration during research, online sources were most heavily relied on.
The options:
Options were endless. However, the decision was narrowed down to a few that seemed to best meet the needs of this case at reasonable costs (Please see Appendix A). It was concluded that almost any handset would do, since the only specifications necessary are now commonly available with all manufacturers. Main considerations of ‘extras’ depended on what functions were most useful for the type of employment involved (such as an FM radio for listening to translated meetings in foreign countries), and which functions could be activated at a later time, though currently chosen to be left dormant (such as Internet). Choice of carrier came down to best coverage. All carriers, being on GSM, could be assumed to be reliable in major cities and even suburbs (GSM Association & Europa Technologies, 2007). Also, because GSM is used worldwide, sufficient roaming partners were found with all carriers (GSM Association, 2007). However, to ensure adequate coverage, carriers that operated in both the 900 and 1800 frequency bands in the UK were seen as best options; that left O2 and Vodafone to choose from (GSM Association, 2007).
The choice:
O2 was chosen for the following reasons:
1) The price, being only 1 pound more than the Vodafone plan, included the same number of talk minutes, plus the International Traveler Service and 512 kb of complimentary Internet usage, not to mention free voicemail and free calls to check voicemail, assets to an employee that must be always reachable but naturally not always available to take calls (Carphone Warehouse Group, 2007a).
2) Although O2 is a U.K. based company operating in only a few other European countries and Vodafone is a worldwide company operating in many countries, O2 still has access to several roaming partners and fees do not necessarily decrease when roaming on Vodafone’s networks in other countries. Therefore, Vodafone’s worldwide reach was not seen as an advantage warranting a changeover of decision (GSM Association, 2007).
3) In a comparison with Vodafone and O2 roaming rates in The Netherlands, it was found that, although Vodafone charges less to receive calls when abroad, all of it’s other charges are more expensive than O2. With O2’s International Travel Service, initiating connections abroad cost 70p/min for voice calls and 25p per SMS (versus Vodafone’s rate of 76p/min and 35p, plus domestic tariffs, per SMS. However, a Vodafone Passport may be used to reduce long-distance charges when calls are long). Receiving calls will cost 56p/min (versus Vodafone’s 38p). Incoming text messages are free on both networks (GSM Europe, 2007).
4) The battery performance of O2’s Sony Ericsson fared much better than Vodafone’s Motorola RAZR, allowing up to five more hours of talk time and 40 more hours of standby time (Carphone Warehouse Group, 2007a, Vodafone Group, 2007a).
5) The O2 Sony Ericsson is a Smartphone with FM radio for the same price (both are free on an 18 month contract) of Vodafone’s Motorola RAZR, which does not include these features (Carphone Warehouse Group, 2007a, Vodafone Group, 2007a).
The only drawbacks that could be found with the O2 option were, for the handset, a lack of the following features: video/photo editing, voice dialing, WCDMA, WAP. However, these are not necessary and the advantages of the Sony Ericsson being a Smartphone with FM radio and longer battery life far outweighed the disadvantages (Carphone Warehouse Group, 2007a, Vodafone Group, 2007a). The price plan disadvantages are only that O2 offers half as many text messages as Vodafone and does not have the off-peak Stop the Clock option (Carphone Warehouse Group, 2007a, Vodafone Group, 2007b). However, 500 text messages should be sufficient as most usage will be voice calls. Also, since the Stop the Clock option is only valid during off-peak hours, it may not prove to be extremely useful since most calls are expected during business, thus peak, hours.
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Works Cited
Carphone Warehouse Group. (2007a). Pay Monthly. Sony Ericsson P1i silver O2. Retrieved October 4, 2007 from http://shop.carphonewarehouse.com/pay-monthly/sony-ericsson/p1i-silver/o2/
Carphone Warehouse Group. (2007b). Mobile phone shop. Pay Monthly. All. Retrieved October 4, 2007 from http://shop.carphonewarehouse.com/pay-monthly/all/
Carphone Warehouse Group. (2007c). Pay Monthly. Sony Ericsson K810i ivory with free Nintendo Wii Orange. Retrieved October 4, 2007 from http://shop.carphonewarehouse.com/pay-monthly/sony-ericsson/k810i-ivory-with-free-nintendo-wii/orange/
GSM Association. (2007). GSM Roaming. GSM Coverage Maps. United Kingdom. Retrieved October 4, 2007 from http://www.gsmworld.com/roaming/gsminfo/cou_gb.shtml
GSM Association and Europa Technologies. (2007). GSM World Coverage (map). Retrieved October 4, 2007 from http://www.coveragemaps.com/gsmposter_world.htm
GSM Europe. (2007). Best roaming fares around Europe. Retrieved October 4, 2007 from http://www.roaming.gsmeurope.org/
Motorola Inc. (2007). Show All Phones. Motorazr Maxx. Retrieved October 4, 2007 from http://www.motorola.com/consumer/v/index.jsp?vgnextoid=f6c8188dc6f20110VgnVCM1000008206b00aRCRD&prodGroup=All+Phones&show=fullSpecification
Vodafone Group. (2007a). Business. Phones. Motorola RAZR Maxx V6. Retrieved October 4, 2007 from http://www.vodafonebusinessshop.co.uk/Details-Phone-Motorola-RAZR-Maxx-V6-2883.html
Vodafone Group. (2007b). Business. Price Plans. Retrieved October 4, 2007 from http://www.vodafonebusinessshop.co.uk/AnytimePricePlans.html
Works Consulted
GSM Association and Europa Technologies. (2007). GSM European Coverage 2007 (map). Retrieved October 4, 2007 from http://www.coveragemaps.com/gsmposter_europe.htm