Survey: Carrier Stores Offer Worst Shopping Experience

By Joseph Palenchar -- TWICE, 12/5/2005

PORT WASHINGTON, N.Y. — Only a quarter of cellular buyers are satisfied with their shopping experience, and carrier-owned stores generally rank lower in customer satisfaction than consumer electronics stores or mass merchants, according to a survey of consumers by The NPD Group.

The survey undermines one of the key foundations that carriers cite for operating their own stores: delivering a better sales experience that generates step-up handset and service sales and reduces churn. Carriers also contend that direct sales are less costly than indirect sales.

Despite their reputation, wireless carriers continue to dominate wireless retail sales. A total of 68 percent of all purchases were made at carrier-owned stores, NPD found.

Among indirect retailers, Wal-Mart and RadioShack were ranked at the top. Among carrier stores, Nextel and Cingular ranked highest, and T- Mobile and Sprint ranked lowest.

Overall, only 24 percent of recent mobile phone purchasers said their buying experience was excellent or good. But "mass merchants, electronics stores and wireless specialty stores consistently ranked higher in customer satisfaction than most carrier-owned stores in a variety of areas, including overall satisfaction, knowledge of sales staff, and selection of phones and calling plans," NPD contended.

RadioShack and Wal-Mart were the top two retailers by overall shopping experience, and they also ranked high in such categories as helpful sales staff, variety of wireless products and store layout.

"Carriers are working to improve shopping experience at their stores," said Clint Wheelock, NPD's wireless research VP. "Many new tactics are being implemented, including better educating sales staff, providing self-service computer kiosks, and changing store layout and flow to improve the customer shopping experience."

"While carriers will likely continue to dominate the wireless retail space, opportunities also exist for other types of retailers," Wheelock continued. "Changes in the wireless landscape, such as the emergence of MVNOs and market saturation, could also offer new opportunities for other retail channels."

In other findings:

The majority of consumers surveyed were repeat phone purchasers. Only 14 percent were first-time wireless subscribers.
More consumers purchased their phone to replace their current phone (39 percent) or replace a broken one (15 percent).

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