Paging carriers and industry analysts alike believe one of the biggest struggles facing the industry is that it needs to change its image in the mind of the consumer.
For years, paging carriers marketed themselves as a cheap communications tool. Today, they want to market themselves as value-added information providers.
According to Wayne Stargardt, vice president of marketing at PageMart Wireless Inc., the business user is a fairly easy market to target. “We don’t have to sell this to them,” he said. “They’re waiting for this.”
But the consumer market is a whole different beast.
“Anytime you’re shifting a universal thought on a product, it’s very difficult,” said Steven Kellogg of Steven Kellogg Wireless Marketing in San Marcos, Calif. “It’s like pulling at a train with your teeth.”
Stargardt agreed. “One of our biggest challenges now (is) to communicate to consumer users the added value they will achieve.”
Analysts say an easy trap for carriers to fall into is to become so enamored with the new technology that they lose sight of the market. Bick Truit, president of the marketing consulting firm Technologies Research Group Inc., said this is a common error.
“The mistake most technology companies make is they make a technology evolution path instead of a market segment evolution path,” he said.
Telephone companies, for example, send customers all sorts of information about new services like caller ID and such to customers subscribing to the most basic service plans-essentially overshooting the target, Truit noted.
“As you begin to roll out two or three enhancements, you have to stop and do research to see what new services are being adopted and create a segmentation scheme to determine what to launch next,” he said.
Kellogg, who was director of marketing for a smaller paging carrier when the industry was working to upgrade users from numeric to alphanumeric service, said the best strategy would be to offer free trials of enhanced messaging services like two-way paging or information services.
“We had the same problem when alpha first came out because nobody wanted it and the reason nobody wanted it was because they didn’t know the benefits,” Kellogg commented. “They need to get it used by the consumer. Give them the motivation to actually try it.”
Kellogg said carriers should target a popular market and offer all subscribers free local news or traffic alerts for a month, services for which the carrier intends to charge, and then see who subscribes once the free trial is over. Carriers could do the same with guaranteed messaging and two-way interactive services.
But for free trials to work, carriers must link them to an educational campaign, Kellogg said. “Offering service for free will do nothing unless (the consumer) is fully trained with how to use it at the point of sale … Don’t let them leave without knowing how to use it,” or they won’t.
Carriers also shouldn’t charge too much for new services, Truit said, because asking a customer to switch services in itself can be difficult. “It’s going to be really restrictive on your pricing,” he said. “You have to adopt the baby-step philosophy. The pricing has to be incremental.”
Basically, the whole pricing issue becomes like a poker game-do you raise prices a nickel a month? A quarter? A dollar? With digital cellular and personal communications services offering short message services at lower and lower prices, the margin for error in this gamble grows smaller every day.
In the industry’s favor is that it has a fairly large and tech-savvy target market with younger people, who already use alphanumeric service and know its value. “Customers already acclimated to basic service are far more inclined to add more services on,” Kellogg said.
Despite the challenges, industry insiders almost unanimously agree that this marketing battle will be won. It’s just a matter of time.
Kellogg said he developed a formula to determine how long it will take any industry to affect such a change: Add the time it takes to get a product to market to the time it takes to reach the penetration level desired and double the sum.
Truit simply said he thinks it will take about two years to change the mindset of consumers. “They’ll maintain share and incrementally add more customers,” he said.
