Corporate Eye

No Brand Loyalty for Mobile Phone Users

iphone ipadThere are 6.5 billion mobile phone subscribers in the world, but according to a survey of 1,660 of those mobile subscribers during the second quarter of 2012, only 34% are loyal to their mobile carriers, meaning they’ve stayed with the same mobile service provider for more than five years.

That’s according to the study report by the Chief Marketing Officer (CMO) Council and Ricoh. Not only do mobile phone subscribers lack loyalty to mobile carriers, but they are also extremely willing to complain about poor experiences with their carriers — not just to the company but to everyone they know. Check out the statistics from the study below:

  • 34% of mobile subscribers have been with the same carrier for five years or more.
  • 29% of mobile subscribers consider themselves loyal to their carriers.
  • 41% of mobile subscribers say they are apathetic, on the fence, or just about gone when asked about their relationships with their mobile service providers.
  • 41% of mobile phone subscribers will lodge a complaint about a poor experience.
  • 36% of mobile subscribers will cancel their service after a poor experience.
  • 29% of mobile subscribers will tell everyone they know about a poor experience with a carrier.

Lack of loyalty and a propensity to tell anyone and everyone about negative experiences are huge problems for brands, and mobile carriers should be aggressively trying to turn both problems around. However, mobile carriers continue to ignore the warning signs and have yet to make the necessary changes to attract and retain customers as well as to increase positive word-of-mouth marketing.

When mobile subscribers were asked why they switch mobile carriers, money was the most mentioned factor. In fact, nearly three out of four respondents cited money as the reason they switch mobile carriers (74%). The breakdown of survey responses showed the following:

  • 48% switch due to high service plan costs.
  • 26% switch due to better deals with more all-inclusive options from competitor carriers.
  • 23% switch due to poor quality of service, including dropped calls and bad reception.

The biggest complaints among mobile subscribers according to survey responses are:

  • Hidden fees = 21%
  • Bad service or network speed = 17%
  • High data or text costs = 17%

The study shows that customers want lower fees and more personalized service and they make those demands very clear. However, a separate study by the CMO Council and Ricoh, which surveyed 147 marketers at mobile carrier companies around the world, found that marketers think technology innovation and advancements are what consumers want and what will build brand loyalty. That’s in stark contrast to the findings in the customer survey which reports just 13% of mobile subscribers consider themselves to be technology fiends who anxiously wait for the next big innovation.

Mobile carrier marketers describe their top engagement priorities as:

  • Retaining their most valuable customers and increasing loyalty = 47%
  • Improving the relevance of communications to customers = 40%
  • Developing new points of engagement = 38%
  • Educating customers through relevant content = 33%

One thing is certain, until mobile carriers accept and deliver what mobile subscribers actually want and need, there will continue to be a lot of carrier switching by unhappy consumers. What do you think?

Image: Yutaka Tsutano

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Susan Gunelius is the author of 10 marketing, social media, branding, copywriting, and technology books, and she is President & CEO of KeySplash Creative, Inc., a marketing communications company. She also owns Women on Business, an award-wining blog for business women. She is a featured columnist for Entrepreneur.com and Forbes.com, and her marketing-related articles have appeared on websites such as MSNBC.com, BusinessWeek.com, TodayShow.com, and more. She has over 20 years of experience in the marketing field having spent the first decade of her career directing marketing programs for some of the largest companies in the world, including divisions of AT&T and HSBC. Today, her clients include large and small companies around the world and household brands like Citigroup, Cox Communications, Intuit, and more. Susan is frequently interviewed about marketing and branding by television, radio, print, and online media organizations, and she speaks about these topics at events around the world. You can connect with her on Twitter, Facebook, LinkedIn, or Google+.
 
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