With the recent entry of small wireless service providers, dealers have emerged as key differentiators for incumbent mobile carriers.
But a recent survey by analyst firm IDC Canada, indicates that there’s widespread dissatisfaction among dealers regarding their relationship with the country’s top tier carriers.
In a nutshell, a majority of dealers perceive they are not getting enough support from the carriers, according to the report titled: Wireless dealers rate carrier value.
The study looked into the dealer/carrier relationship using a dealer program framework that tests the importance and value of carrier support across four key components: marketing resources; sales resources; technology resources; and financial resources.
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The study also queried respondents on the attributes of these components such as: tools; training; discounts; and commissions.
Wireless carriers get failing grade
Majority of the dealers (75 per cent) had no more than one or two locations. The carriers involved in the study were Bell Mobility, Rogers Communications, Telus and MTS Allstream.
Overall, as much as 52 per cent of the dealers feel their relationship with carriers has “deteriorated over the past three years”, according to Paul Edwards, director of SMB and channel research for IDC Canada.
Only 11 per cent of the dealers felt their carriers were meeting their needs and 38 per cent of dealers considered their wireless carrier relationship to be a business priority in 2010, he said.
“Clearly carriers are missing the mark when in comes to providing for their dealers’ needs,” Edwards said during a Webcast on Wednesday.
For instance the survey showed that:
- Only 23 per cent of dealers said their carriers were quick to respond
- About 22 per cent or respondents said carriers provided adequate support
- As low as 20 per cent indicated that their carriers were easy to deal with
Bad time to ignore dealers
This is the worst time for the carriers to ignore or let their dealers down.
Smaller mobile service providers such as Wind Mobile, Mobilicity, and Public Mobile have began snapping at the edges of the incumbents’ market with enticing cheap, no-fuss, no contracts, and unlimited voice and text plans.
“Dealers are becoming market differentiators for carriers, especially with the increase in new competition and carrier revenue sources leaning more to wireless services,” Edwards said.
His said the study results and current market realities “reinforces the need for monitoring dealer relationships for continued improvement and market growth”.
Dissatisfaction with the incumbents is very strong among Canadian mobile users, according to independent technology analyst Carmi Levy.
High service fees, inflexible packages, spotty reception and customer service quality are common gripes among users, he said.
“This by itself isn’t sufficient to catapult the new wireless firms to success,” Levy said “but new entrants are developing the ability to carve out a niche in the market segments not served by the incumbents”.
What carriers should do to keep dealers happy
Despite the dire numbers, there was a bright spot for carriers in the IDC study.
The majority of dealers (82 per cent) still see carriers as a source of quality products and services. Edwards said carriers can build on this focus on areas that are crucial to dealers.
Some of the areas that carriers should concentrate on are:
- Marketing
- Sales and financial resources
- Marketing development programs and co-op funding
- Pre-sales marketing
The top three tasks for carriers seeking to patch up relationships with their dealers are:
- Setting up a formalized process of analyzing relation strengths and weaknesses. A standardized process of routinely measuring success and failures should be in place to enable carriers to determine which programs need to be kept and which ones need to be revamped or replaced. This includes getting feedback from dealers on regular intervals.
- Act on results. Once feed back and results of studies have been received, carriers should come up with a game plan of dealing with the issues and then carry it out as soon as possible.
- Develop a communications strategy. Set up a mechanism for maintaining effective communication with dealers. Consult with dealers on appropriate action plans. Communicate any relevant changes or results of actions to dealers.