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Smartphone users more loyal to their network

By Peter Clark, Marketing Factbook

 

As more and more mobile telecoms customers switch to smartphones, many retailers are having to adjust their 'sales experience' to address the specific needs of these tech-savvy customers, according to a report by J.D. Power and Associates.

The study, entitled '2010 US Wireless Retail Sales Satisfaction Study', examined evaluations from customers who recently made an in-store mobile telecoms retail purchase, and found that overall customer satisfaction with major wireless carrier-branded stores is based on four factors:

  1. Sales staff (49%);
  2. Price and promotion (27%);
  3. Store facility (14%);
  4. Display (10%).

Nearly 40% of the customers who had visited a wireless retail store during the previous six months to either replace or upgrade a mobile phone from a previous carrier, to switch carriers, or to sign up for a new service now own a smartphone.

Satisfaction with the retail experience among smartphone owners averaged 11 index points higher (on a 1,000-point scale) than for traditional wireless handset owners (727 compared to 716 respectively), despite the fact that smartphones usually require additional service subscriptions and are more complex to operate. In fact, smartphone owners tended to be more satisfied than traditional handset owners for all four factors, particularly with regard to sales staff.

"The recent increase in smartphone sales will have a long-term impact on how carriers handle their customers' needs," explained Kirk Parsons, senior director of wireless services for J.D. Power and Associates. "These phones do require retailers to adapt by constantly training sales staff to keep pace with new features and offerings, but carrying out simple tasks, such as explaining the phone's operation, provides salespeople with a great opportunity to improve the customer experience and fosters greater loyalty to both the carrier and store."

The study also found that owners of smartphones are 27% more likely to visit their carrier's retail store to enquire about problems with their phone than those with traditional handsets. In addition, smartphone users are 18% more likely to go back to their carrier's store when a phone needs to be repaired, compared with owners of traditional mobile phones.

Smartphone owners spend an average of more than one hour in the store during the sales process, which is four minutes longer than owners of traditional phones, perhaps due to the fact that smartphones require retailers to spend significantly more time carrying out tasks such as activating the phone. Sales representatives also spend about one minute longer carrying out value-adding tasks with smartphone owners (such as showing them how to operate the phone) than they do for owners of traditional handsets.

Among customers who said they were highly satisfied with the knowledge of a salesperson (i.e. those giving a score of 8 or more on a 10-point scale), 92% said that they planned to revisit the retail store, compared with only 70% of those who were less satisfied. Similarly, 91% of highly satisfied customers said they would recommend the store while only 62% of less satisfied customers said the same.

The study also found that:

  • Displaying basic courtesies, such as acting in a straightforward and honest manner, remain critical for sales representatives. Satisfaction was 204 index points higher when representatives were perceived as straightforward and honest than when they were not;
  • Nearly half (46%) of wireless customers said they visit their carrier's store to upgrade or replace a phone. However, satisfaction is highest when such visits are to add or subtract a family member (732) or to renew or change a service plan (727).

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Sources: J D Power; Associates
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