Tuesday, May 5. 2009No Time To Make 'Yesterday's' Decisions.....John Linton ....let alone making today's decsisions. I think that the only thing worse than being responsible for various aspects of running a small Australian communications company in difficult financial times is running a small Australian communications company in times that are not particularly difficult but might become so. In uncertain times it seems to me that you actually can't make any decision without continually reconsidering (I suppose I really mean worrying) about whether you've done the right thing/made the right decision. As there are always new things that need to be considered/worried about it doesn't take long for what remains of your mind to be fully occupied with decisions that have already been made rather than leaving the requisite time for decisions that have yet to be made and often meaning those decisions don't get made within the required time frames. ...and I'm not referring to routine decisions such as the recent decision on which IP provider will we use or what pricing we will set for our various products and services and the other day to day decisions that can have easily understood criteria applied to the decision making process. One thing that has been 'under consideration' for almost six months is what, if any, sort of advertising/promotion Exetel should do for the HSPA services which we believe are important to our future. Though as things tend to do in this industry, even the assumption that HSPA is important to Exetel in Australia is increasingly being re-thought - but that makes everything far too complicated so we'll take it that HSPA is important - at least for the time being. We believe that HSPA is important because we can add more value to that service than any other. By adding value I mean that we can source the USB modems at a lower price than our wholesaler is selling them to other wholesale customers and we can source Yagi aerials (for those customers who need them) at much lower prices than are available anywhere else in Australia. One day we will be able to source the 'magic box' at a very low price as well. So our thinking has been that HSPA in regional/rural Australia is not something that is best sold by Dodo's/Virgins/Optus Retail/Vodafone Retail/BigPonds saturation advertising but really requires a local presence (in our case an Exetel agent) who can sell the 'easy' customers via a shopfront or his/her usual methods but can also make very good profits by selling the hardware (aerials, modems. ATAs) at high margins (courtesy of Exetel's "buying power") but still at end user costs below those offered by anyone else.....and of course they can sell their installation services where those are applicable. Plus - we will pay for their advertising which will promote their business generally. It seemed like a great combination when we 'dreamed it up'. Now, one issue that has played a major part in the uncertainty has been the likely pricing by the various carriers. It seems that all of the carriers (with the exception of '3') have exhausted their "I can offer more for less than you can" promotional phases - at least for the time being, and are 'content' to sell at their current price points at the moment. While that is of no help to Exetel (all the carriers plans to end users are at lower costs than we can buy at wholesale) it is at least some sort of 'stability' compared to the whole of 2008 and the first 6 weeks of 2009. Perhaps that will not turn out to be true but even if it doesn't we believe that the hardware pluses above plus the free 100 VoIP over HSPA calls plus the free faxes and free SMS will make a very powerful regional/rural offering backed by advertising and 'feet on the ground'....that's the theory. We originally (back in October 2008) planned on spending some $350,000 over three months to promote HSPA in regional/rural areas of Australia. As we have shlly shallied about what we would exactly do we have realised that we actually don't know how to most effectively spend that money and having talked to a number of "experts" have been advised that we need to spend closer to $A2 million over 6 - 9 months to achieve the aims we believe are the minimum we need to achieve.....to me that is a seriously scary number and if I was ever going to spend $A2 million of my own money it wouldn't be on promoting HSPA (or anything else for that matter) it would be on a small house in the South of France or the Caribbean or something of personal comfort and ongoing value. It doesn't help that Exetel has never spent any money on promotion/advertising and that no-one in our small company has any experience at all in that sort of activity. However, we need to do something along the lines of country advertising and promotion and also need to put in place the processes that are required to deal with the results of those activities and, right now, I haven't got a clue how to do this. I will talk to another 'expert' later this morning and then will have to make a decision on what we will do and, far more importantly, the time frame in which it is possible to do it. We will run a small sample test by putting a quarter page ad in 5 or 6 local newspapers over the next 2 - 3 weeks in conjunction with some of our regional agents and one test advertisement with our own contact number on it to attempt to gauge the level and types of responses - and that's as daring as we have screwed up our courage to become at the moment. There are three other similarly difficult issues, of a similar financial impact, that we need to address at this time but they also keep getting deferred as we wait for some indication of what is really going to happen in Australia financially and economically. They look like having to wait an extra six months for go/no go consideration just as the HSPA promotion has. Trackbacks
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If you need a house boy to work in that dream house (I don't mind, the Caribbean or the South of France would be great), I would be happy to be of assistance.
There is nothing like hijacking someone else's fantasy!!!! Comments (2)
Some years ago I was helping a client with their business plan.
They made a product used in regional areas - an agricultural product. They found their best marketing results came from advertisements and "human interest" stories in "agricultural" magazines. Rural newspapers gave a very poor response. Regards, Harry. Comments (5)
Thank you for the suggestion.
Would you happen to remember the names of those magazines? Comments (11)
ACP Trader Magazines publish Blues Country monthly.
http://www.pubserv.com.au/pdf/BCM%20Media%20kit%20WEB.pdf Comment (1)
I cannot remember the names - but I'll find out for you.
I can remember directing them to magazines which their "existing" customers subscribed to..... the old maxim being "advertise in places your prospective customers frequent". I can remember (in their case) they even tried newsletter of different industry associations (e.g sugar industry, livestock industry, hobby farm association, small wineries). Do you have a profile of your existing customers? Maybe one of them could provide your "human interest" article. Regards, Harry. Comments (5)
Right now we have no HSPA 'user profiles'.
As Michael says in his subsequent reply - basically people on the fringes of country towns or ten or so kilometers off the major highways. Comments (11)
One of my customers runs a stock market trading and software development-like company plus a traditional farm on one of these outer sites. He might be a contender for such a story. Email if you want more info.
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Doesn't Steve have one of his family members with an extended antenna connected in WA somewhere that he did during his connectivity road-trip?
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Yes he does.
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I have been "a voice from the past" - to my old client......
....they tell me their best results come from: Blues Country Qld County Life (They operate mainly in Qld). Regards, Harry. Comments (5)
Thank you.
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As you know I've done trials up to 32KM from town with HSPA and Yagi antennas. Many of those people are surprised when it works as they assume they're too far away.
Once a steady supply of antennae is available I'm really looking forward to advertising this service with you - surely in every smaller town there must be a huge opportunity for those people living between 7km and 30km from town and we just need to reach out and get their attention somehow. One unusual strategy that might also work is simply for an agent to grab a yagi, stick it on the back of the ute, and drive down the country roads in spare time; dropping off a flyer in each mailbox along with a signal strength and optionally a speed test result from their mailbox location to stick in their mailbox. It's a lot of work for a few days but it's pretty well targeted. Inverters are cheap these days too, so an agent could easily run an inkjet printer and laptop from the vehicle to print the results. At the moment, the only thing stopping me from doing anything like that or from perusing any other form of advertising is that the requisite antennae are not yet available in sufficient numbers. I suspect papers like "The Land" are what you might also be looking for. One thing to consider is that these papers go out to a large area, so it might be nice for us agents if you could include the agent lookup page somewhere in such an ad. I have a number of contacts in farming and land-care related areas, so if you like I can also check with them what publications they think would be effective. I'm not too worried about the lack of a magic box yet - the NetComm N3G for $145 wholesale is close enough and still lets the customer take the modem away with them if needed. The only issue thus far is VoIP - I can't get it to work with the $20 ZyXel boxes, but it works fine with the more expensive Sipura gear. Still, that's a secondary use and with some of the mobile deals around these days has lost some of it's appeal. Cheers, Mike. Comments (2)
Good suggestions Michael - you should cut and paste your reply into the advertising thread in the Agent Forum.
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I would be looking hard for any type of test advertising possible such as what you mentioned.
A couple that come to mind are community radio stations and letter box drop by RSD posties. Comments (2)
John,
Sorry to put a downer on everything - but is country HSPA really a winner. What sort of volumes of customers would you need -- times profitably to Exetel on each connection offered to make the whole thing worthwhile endeveavour. I just feel that this will be just a small sideline to Exetel - and I would be wary putting too much money into it -- the other telcos are going to remain paralyzed forever. cheers bill Comment (1)
There is nothing more important for me personally in terms of providing communications services than giving people who run businesses in 'rural/regional' Australia and, particularly those people's children decent broadband access.
Can we make any money out of it? No more than we make at the moment out of providing services to city dwellers - which is very little. You might as well ask why we provide 'services' to a pitifully few of Australia's endangered species rather than keeping the money ourselves. We aren't like other ISPs and the people who run them Comments (11)
If school children are a focus, you could contact some rural schools and provide/arrange for some free "test" units for a selection of their "remote" students to try out (for a fortnight or month or so).
Word of mouth would work very quickly from there. Those "remote" children would number in the thousands.... H. Comments (5)
With regards to HSPA...
You've talked about people on the land.... ... what about fishermen? Would they be able to trig up an aerial and use HSPA too? .... now that could be another reasonably big market. H. Comments (5)
Yagi antennae need fine alignment - my personal experiences indicate this would not be possible on a boat.
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I'm sure what you need at the moment is more unsolicited advice on how to spend your advertising budget, but this is a blog after all
Forget carpet bombing TV, Newspaper, Radio or whatever else your ad agency people had in mind - You should know full well that that's Dinosaur thinking of the sort Exetel has almost never engaged in. The fact that you've grown your business to 75,000+ customers (or whatever it currently stands at) should tell you that they don't know what they're doing and you do. So here's my idea: Forget the advertising. Spend the money on improving your affiliate/agent program - Increase the margins if that's what prospective agents are asking about, improve the process every way you can for them. Use your advertising budget to recruit more agents, and with any luck they'll do the customer-acquiring for you. On a personal note - Really enjoy the blog when you're talking about the biz stuff, but could we put the policy/politics rants on a separate feed? Comment (1)
Our current idea is to only spend money advertising in conjunction with rural/regional agents so that would achieve your suggestions - I would think.
In terms of politics being separate to communications - in case you hadn't noticed the NBN1 nonsense followed by the even greater NBN2 nonsense together with the CP Filtering nonsense has made it unavoidable to comment on Labor's malign influences on this industry and, by extrapolation, every other aspect of Australian life. Comments (11)
How about trying a few general stores or news agents in country towns as introduction points if not agents for hspa. You could do a deal for their connection and they get a commission for signing people up though they might refer them to an agent for further setup help if they or the customer are unable to manage that part.
The service could be demonstrated then and their. People could be shown the yagi on the roof and informed on where it's pointing to, what landmarks are nearby etc. to help them with their own setup. If it worked it could come to the point where they had a stock of modems and antennas available and ready to go. Comments (2)
Are the Yagi antennae ready for sale yet? I have two friends living on semi-remote properties near Kiama (just south of Wollongong) who are ready to sign up with your HSPA service as they cant get ADSL1. A Yagi antenna would make it a perfect solution right now.
I cant see anywhere on the ordering page to specify buying one along with the wireless service. Comments (2)
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