John Linton The second month of the new calendar year is now halfway through and both Telstra and Optus have published their half year results though neither provided understandable figures concerning the extent of their successes or failures in the ADSL marketplaces. Telstra's claim of gaining 1,000,000 new customers was a very clear indication that their 'customer win back' strategy spending had produced some sort of result but they were surprisingly 'coy' in not providing any, at least that I could see, specific breakdown of the product gain by type of service - it all seemed to be, from what was published, "mobile and mobile broadband" but with some significant ADSL gains - unspecified.
A major problem we continually face is that all the carriers we deal with are always happy to talk about 'promotions' to increase sales numbers in any given month but always, because the way they are measured, base these promotions on net new customers (i.e. new customers signed up to the carrier's service minus customers who transfer to another service during that month). This is a more than reasonable attitude/basis but it constantly 'annoys' current customers who see 'new' customers getting 'better deals' than they do. In the past we have dealt with this 'restriction' by taking the financial accommodations offered and spreading them over the whole of the customer base for that service which results in significantly diluting the benefits to new customers and falsely lowering the price to 'old' customers which, over time, creates a major cost problem.
Over the past two years this situation has been massively exacerbated by Telstra Retail's "win back" promotions where not only are they able to offer plan prices lower than the wholesale pricing to Exetel but they offer $200 plus 'cash backs' as well as zero churn costs. So if Exetel offers a 'promotional' price for a plan to 'new' customers but cannot offer that to 'old' customers and then some back packer knocks on the door of the Exetel customer offering a better monthly price and a 'fistful of dollars' from Telstra to move away it is unsurprising that many thousands of Exetel customers decided Telstra was a better provider than we were. That's business life and all that can be done is accept that small companies can never rely on anything staying the same and try and constantly innovate and move in directions that large companies can't duplicate....a very draining way of spending day after day after day.
So we have yet to find a way of using the latest round of 'carrier promotional bonuses' that are based on net adds of new customers in ways that achieve some sort of positive results for Exetel, meet the carrier requirements and do not annoy our current customers. This is proving impossible to do so far and we are not getting anywhere in framing these possible new promotions in any way that will meet even two out of three of these requirements. We will tentatively try out a new Telstra ADSL2 plan (TCV200) which is priced at $50 a month with no peak/off peak but with 200 gb of included downloads (uploads remain uncharged). This can only be done because of the promotional assistance offered if we sign our lives away to producing very difficult sign up numbers - which I have serious doubts about. Such pricing will also undoubtedly annoy our current Telstra ADSL2 customers but there is nothing we can do about that at the moment. Such pricing is also not available to 'regional' customers as it is restricted to what Telstra define as "Region One".
We could get that ADSL2 price down to $40.00 or even $35.00 if a customer also signed up for an Exetel/Optus mobile capped plan service. Then again a wireless broadband user can get a 5 gbps service for free or even for $5.00 cash back if they also buy the new Exetel/Optus wireless broadband plan or ditch their PSTN line....now that makes for an interesting piece of marketing.
So, damned if you do/damned if you don't, if business life was meant to be any other way for smaller businesses then there would be far fewer larger businesses.
Copyright © Exetel Pty Ltd 2011
ABN 350 979 865 46
PS: More indications of the problems wireless broadband will cause for the Labor Government:
http://www.itwire.com/your-it-news/mobility/45132-telstra-to-launch-lte-by-end-2011
http://www.commsday.com/commsday/?p=2328