Segmentation - Cellphone

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Expanding Possibilities

Marketing 363

Isaiah Beauchamp

Justin Jones

Hailey Rishoi

Table of Contents

A Sub-Segment of a Retail Market        

Competitive Environments of the Cell Phone Industries        

Verizon        

The Best Quality        

Pricing and Plans        

CRM Strategy        

Store Layout        

AT&T        

Pricing        

Ahead of the Competition        

The “AT&T Girl”        

Sprint        

Ranked Third Behind Verizon and AT&T        

Challenges Sprint Faces with Other Competitors        

Sprint “New Plan” To Attack the Market        

Pricing Strategy        

Conclusion        

Works Cited        

 A Sub-Segment of a Retail Market

What is Sub-segment of a retail market you ask? A sub-segment of the retail market- as part of their debates, people have designated that sub-markets were likely to have products with unique characteristics, distinct customers, distinct pricing, and even specialized retailers. A smaller and more defined sector of an overall market, which has a number of differing marketing and structural features, which may include distinct distribution channels, price elasticity, competitive sets, and effective promotional methods. A section of a retail market we chose was the cellular phone market. The three competitors on of this sub-segment are Sprint, Verizon, and AT&T.  Our group will discuss the competitive environment of the cell phone industries, which cell phone company leads the market, and the company’s shares of sales in the market, what are some of the challenges they face, how this company communicates to customers with advertising, sales promotions, public relations and personal selling.

Competitive Environments of the Cell Phone Industries

         According to Sinha, in his article, he explain,“Did you know the cell phone industry is among those that experienced the fastest growths in the communication industry? The other element of this very broad industry is the Internet. Since 1994, cell phones have become increasingly popular. Its prevalence in usage increased exponentially from 24 million at its early onset to a whopping 182 million. However, that figures, 182 million, merely accounts for wireless phone devices in the U.S. There is another 162 million, which accounts for all mobile phone users in the U.S. These figures are just for the U.S. population; can you imagine the global statistics?

Today’s ever-changing modernizations and countless emerging innovations have resulted in vast improvements in cell phone technology. We are living in a world where everyone wants to keep up with the latest, most advanced gadgets and new technology. As a result, the cell phone industry keeps on growing since this gadget has become an indispensable everyday tool for every Joe and Jane in the world. Even parents want their children to have cell phones. Due to the convenience and ease of communication, cell phones have become a necessity between parent and child in order to facilitate communication, especially in case of an emergency. In addition, with new features offered by wireless carriers under existing telecommunication plans, adding a child as a new user to a parent’s plan has been made easy. With the inclusion of teens and children to their parent’s plans, this has resulted in the increase in the number of cell phone users.

With industry growth also comes an increase in the intensity of competitive rivalry. As a result of many offerings for more affordable cell phone units and similar devices, the cell phone industry has also grown significantly within the last three years. Many cell phone and telecommunication companies are vying for the top spot in their respective fields in the broad communication industry. Since they are basically offering the same product or service, this makes for a very tight competition. These companies are looking for ways to attract customers to their fold. Among their enticements, include offering low price rates, more service features, better products, more freebies, etc.

        Nevertheless, competition among these companies is good for us, consumers. With their goal to provide the best products or services, we have more choices and better options. Consumers are afforded with better products and services at more affordable prices. There are also more services being offered among these companies in an effort to gain an advantage over the competition. Everything is much better for us, consumers, in this competitive environment among these companies.” (Sinha, 2012-2015)

Verizon

The Best Quality

Verizon is the best wireless retailer for many reasons. The most obvious to our group is the proven past performance they had with their customers. Verizon utilizes the high end/ high quality market for wireless carriers. They are typically more expensive, but you get what you pay for. By focusing on coverage and quality it allows Verizon to capture a greater market share.  Positioning themselves as a premium brand, they market themselves as much and their advertising. Verizon offers many services to fit each customer’s needs. Verizon have new pricing and packages. The era of 2 year contracts is starting to dwindle away.

Pricing and Plans

Verizon offers the “Edge” plan now to give the customer a choice. There is the grandfathered in 2 year contract, or the “Edge”.  Not only does the Edge offer a discount for going with the Edge program, but it lowers your up font costs for the phone as well.  Verizon gives $10 off each smart phone on the edge plan and allows free foreign texting. Customers who chose the Edge plan make monthly payments on the phone to spread out the cost over a normal two year window. Additionally, the program allows for flexibility with the customers phone choice. After just 30 days the customer can switch phones by just paying off 60% of the current phone and then the monthly payments would start over again with the next phone choice. The traditional two year contract is still available but the problem is if you’re not grand fathered in so to speak it’s more of a pain in the butt than anything. You can still get the rebate for the new phones but there are stipulations and Verizon goes out of their way to make it more enticing to join the Edge program.