Is Sprint [S] finally becoming customer-oriented?
The Problems
Since Dan Hesse came into power at Sprint, there seemed to be a lot of restructuring of plans to grab more wealth from hapless customers. It seemed to most analysts and pundits that Sprint was somehow repositioning itself as a “luxury” carrier, in a market that cannot afford to present itself as “luxury” services, particularly given the long history of excessive profit-driven fees and stiff penalties against loyal long-time customers and new customers alike. Of course, that tactic just does not work, and both new and existing customers have demonstrated their strong dislike of Sprint’s poor customer service and product offerings by fleeing the carrier for greener pastures.
Even I had an extremely rough customer experience with Sprint during my transition to the Centro smartphone (Part 1, Part 2, and Part 3 of the first saga).
And on the topic of mobile devices: Sprint has not been able to easily attract first-tier manufacturers to launch their latest and greatest products under their banner. Some of it is due to technological mismatches, but some of it is due to preference on the part of the manufacturers… This is Not A Good Thing.
Turning the Corner?
So what is a carrier with declining revenues and market share, a less-than-stellar product catalog, and poor customer service supposed to do to avoid bankruptcy and/or getting splintered into separate bits of fishbait for the other carriers?
Yesterday, Dan announced that they will be eventually upgrading their customer service software to allow for pro-rating of the early termination fees (ETF’s) charged to customers who struggle to leave the carrier. While other carriers have been pro-rating the ETF’s for quite some time, Sprint arbitrarily charges a fee in excess of $200, regardless of how loyal a customer has been. Of course, charging such inordinately high ETF’s by alleging that the cost is justified because of the subsidy offered by Sprint for the devices that customers have is a specious argument: many customers actually bring their own devices into a plan or have already approached the end of their agreements, so the devices have already been completely paid off by the customers.
Couple this announcement with the training being given to customer service reps to attempt to improve how customers are treated, and perhaps Dan will be able to stop the hemorrhaging of valuable customers and the revenues that they command.
A Fair Management Decision
By updating their customer service software to pro-rate the ETF’s is a good idea. It is a concept that should make customers feel comfortable with giving their business to Sprint, with the perception that they will finally get a fair deal.
In turn, manufacturers may finally determine that Sprint will become a worthy carrier to do business with. With Sprint’s attempts to roll out its WiMAX offering, more enterprising manufacturers with higher capacity devices will become interested in hooking on, but no salient bets are taken just yet on this topic.
In addition to dealing fairly with customers, this about-face on Sprint’s part should also hopefully ease lawsuits and fines by the government regulatory bodies.
The next steps that Dan must act upon, in order to be successful:
- Implement the next wave of customer service improvements;
- Reformulate the cellphone plans to be value propositions instead of “luxury” items;
- Partner with more technology companies and manufacturers to gather a more attractive product catalog, particularly with convergence devices;
- Partner with other market providers/vendors to extend Sprint’s reach and visibility (via Wi-Fi, or public terminal services);
- Rethink a lot of the add-on “services” to wireless customers, and bundle the more utilitarian ones with value plans and larger packages;
- Rollout WiMAX to the public en masse.
N.B.
Other Reading
- “Sprint to join rivals in cutting termination fees” (Yahoo! Tech/AP)
