Telecoms Services consists of on-going airtime revenues, facilities management business and our MVNO (Mobile Virtual network Operator – see below). Its function is to influence European retail presence, hopefully resulting in growth in its on-going airtime revenues. In addition to this, it was instigated to help enlarge its management business model across Europe. Similar to the distribution segment, the telecoms service business observed a remarkable 268% upsurge in revenue from £11.5m in 2000, to £42.3m in 2001. Additionally, they are now seeing organic growth; the Carphone Warehouse telecom services now manage in excess of 915,000 customers.
The Carphone Warehouse data services embrace all their mobile services and products. Its main job is to stay up-to-date with technology, for example, WAP services (mobile access to the internet), and GPRS services. Again, this segment has observed an increase in revenue, from £0.4m in 2000, to £0.9m in 2001. As shown above, by the Carphone Warehouse dividing their company into three, manageable areas, it has enabled them to grow and develop with staggering and very advantageous results.
For the Carphone Warehouse to gain, and then maintain competitive advantage, it must have a strict but realistic set of aims. Logically, they have created their own ‘philosophy’. In this they state that they must “exceed our customer’s expectations by providing an innovative approach to service”. For this to happen, they constantly need to be updating and creating new services and ideas. Therefore, they need to ensure that their employees are motivated and stimulated, as they are key players in delivering the standard of service wanted.
To enable this philosophy to be effective, the Carphone Warehouse invests much of their time and money in extensive training programs, especially for sales consultants, as these are arguably the most influential figure for every customer. They go on a two week training program where they are shown how to recognise what package is most suited to each individual customer, and taught the importance of impartiality towards other networks (otherwise this could be off-putting for customers if they are ‘forced’ to go with the preference of the sale consultant). Throughout employment, they are constantly being trained and assessed, to ensure that they are up to date with new offers and technological advancements. To ensure that they maintain the standard of service required by the company, the Carphone Warehouse has set up 5 regulations that must be adhered to (see appendix): 1. if we don't look after the customer, someone else will
2. Nothing is gained by winning an argument, but losing a customer
3. Always deliver what we promise; if in doubt, under promise and over deliver
4. Always treat customers as we ourselves would like to be treated
5. The reputation of the whole company is in the hands of every individual
The Carphone Warehouse was named the Retail Employer of the Year by Retail Week magazine in both 1999 and 2001. Additionally, its employee turnover (in the UK) is about 20% per annum, whereas, other UK key retailers manage an average of between 32%-37%. This proves that their training, strategies and general employee ethos is productive and rewarding.
A further method used by the Carphone Warehouse to maintain such a high standard of customer service is its innovative approach to new ideas and developments. If offers a multitude of unique services only available to its customers, that help them to stand out and be positively noticed as a mobile retailer. A prime example of this is the Express Repair service, where by, if the phone breaks down a ‘loan phone’ will be leant out while the other is fixed, or, alternatively, you can chose an express in-store repair service. The latter has proved to more popular, as 60% of ‘broken’ phones are repaired using this service. The second service covers a number of smaller ones, but collectively they are known as Customer Guarantees. They include the Price Promise where by they will match the price offered somewhere else for the same handset; the Ultimate Price Promise, meaning that If the price paid for the handset is higher than the price listed in company’s following month's Buyer's Guide, they will give you a credit voucher for the difference; the "No Lemons" Guarantee, the Extended Warranty, and 14-Day Exchange. A third service is the Airtime Revenue. The company generates income due to their relationships with other European mobile network operators: the Carphone Warehouse receives shares of air-time revenue that comes from new customers that they introduce to these foreign operators. Facilities Management is the final service, where by the company can provide the customer with such things as billing, complete revenue management (for example credit control), call and messaging services and the after-sales care. All of these are available because the Carphone Warehouse purchased Cellcom (in the UK), and more recently the French telecoms services business of CMC.
Customer satisfaction plays a major role in the continued development and growth of the Carphone Warehouse, so they go to great lengths to monitor their customer’s views and opinions of their service. Within a week of a customer purchasing a mobile phone, they will receive a questionnaire through the post asking them how satisfied they are with the actual store that they purchases their mobile through, and if they are pleased with the different strategies used by the company. All of this information allows the management of the company to assess how well their ideas work in reality. Approximately 20% of questionnaires are returned, quite a substantial number for a survey of this nature. They show that 96% of customers that returned the questionnaire would recommend The Carphone warehouse to a friend, thus showing that they are meeting their standards, and consequently gaining competitive advantage over other retailers.
The Carphone Warehouse does not only dedicate themselves to the needs of their customers, but also actively support charity work. Any contributions made to the company and usually contributed o these charities: Get Connected, Macmillan Cancer Relief, Prince's Trust and Capital Radio's Help a London Child. If customers see that The Carphone Warehouse not only openly commit their time to them, but to disadvantaged people, then it helps to establish a caring, devoted reputation for the company.
As already mentioned, The Carphone Warehouse feel that for them to continue being the market leader, they must resume trying out new and innovative ideas that will fill a possible gap in the market. So in December 1999 they launched Fresh, a Mobile Virtual Network Operator business (MVNO), linked to One2One (another mobile retailer). Fresh became one of the first active MVNO’s in Europe and copies existing tariff packages already obtainable by other mobile operators. It boasts low monthly rental; no contracts, credit checks or paper billing; monthly customer billing by SMS; air-time top-up notification by SMS; and air-time top-up capability via a call centre or in-store.
