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Wireless Dealers Facing Tough Slog: Survey

9/21/2010 03:07:32 PM Eastern

Atlanta - Wireless dealers
are not immune to the harsh retail environment, a new survey suggests.

The poll of 95 wireless
retailers, conducted last month by cell phone insurance and replacement firm eSecuritel,
suggests that mobile dealers are clearly feeling the effects of a dour economy despite
recent upbeat outlooks from Best Buy Mobile and RadioShack.

Indeed, more than a third
of respondents said the biggest challenge to their business is the fact that consumers
have less disposable income due to the difficult economic environment.

As a result, wireless users
are spending less after their initial handset and accessory purchases, 30
percent of the respondents indicated.

eSecuritel said the
findings jibe with research from CTIA-The Wireless Association, which showed a
decline in monthly revenue per subscriber of 3.8 percent last year over 2008.

Making matters tougher, customers
tend to shop around more and don't make a purchase decision as quickly, 40
percent of survey respondents observed.

An equal number of retailers
said they are combating softer sales by placing an emphasis on their expertise
as a local business with community ties, which has helped position them as
retailers of choice for handset sales and service. Indeed, fully 41 percent reported
that community activities were among the most popular efforts for driving
customer traffic to their store, while another 28 percent said the delivery of value-added services has
helped differentiate them in their local markets.

Wireless retailers are also boosting sales through online advertising
including local search (39.4 percent), as well as through traditional
advertising including newspapers, TV, radio and billboards (35.1 percent). In
addition, more than half (51 percent) are engaging existing and potential
customers through the use of Facebook and other social media, the survey showed.

eSecuritel said another
opportunity for revenue generation exists in extended coverage programs, as more
than 60 percent of wireless retailers do not offer their own handset protection
program or a third-party program in addition to what is available through the
carrier. Dealers also cited the increased customer satisfaction, peace of mind
and customer loyalty that extended coverage programs offer, eSecuritel said.