Ken Jongsma <73115.1041@compuserve.com> (05/03/91)
The current {Business Week} has an interesting article on the state of
Cellular Service today. Apparently, there has been a substantial
slowdown in the growth of cellular and the cellular companies are
having to start paying attention to "Service." (What a concept!) Some
details:
1) Revenue growth dropped from 71% to 36% in one year.
2) PacTel Cellular average monthly revenue dropped from $104/month
to $91/month in one year.
3) Bell Atlantic transfers you to a "Save Team" when you try to
drop them as a carrier. BA thinks it keeps 25% of those trying
to drop. (High Pressure Tactics? "You drop - We know where your
car is.")
4) Industry churn rate is 36% per year, up from 24%.
5) Voice Mail causes customers to spend 15-20 minutes more per
month on the phone. (And they generally charge extra for this!)
6) Industry averages $600-$900 spent in marketing for each new customer.
Save Teams are nothing new. Try dropping your American Express card.
You'll get transfered to someone who'll try to talk you into keeping
it, even offering to give you a credit towards the annual fee.
Ken Jongsma ken@wybbs.mi.org
Smiths Industries 15.1041@compuserve.com
Grand Rapids, Michigan jongsma@benzie.si.com
[Moderator's Note: I've had the same feeling about the cellular market
ever since the greatly discounted (and sometimes free!) cell phones
started appearing on the market tied to specific carriers. When
Fretters offers cell phones for $29 in connection with one year
service commitments to Ameritech, you know someone is starting to feel
a pinch! PAT]