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Opinions Mixed On Dealer Promotion Of LNP

Retailers generally agree that wireless LNP is an opportunity, but they don’t agree on whether to aggressively promote the option to consumers ?or how soon.

Among multicarrier retailers, the issues include potential breaches of carrier contracts, a desire to maintain strong carrier relationships, and a potential conflict in their position as offering unbiased advice.

At least one major chain said it hasn’t even considered the issue because it’s concentrating first on preparing itself operationally to offer LNP and to answer the questions of confused consumers.

“Customers wanted this for a long time,” said Shelly Fuller, wireless director for the Seattle-based Car Toys chains. “I believe we will promote it.” Strategy Analytics analyst Chris Ambrosio said some retailers “might promote it as a centerpiece in their ads if they offer multiple carriers.”

Retailers will have to choose their words carefully, however. “Once we sell an activation to a customer, we can’t ever approach them to get them to switch,” said the buyer for one regional chain. “It would be a breach of contract, though the consumer can approach you, and you can give them options.” As a result, any LNP promotion would probably have to be a “generic call to action,” not a specific exhortation to switch from one specific carrier to another, the dealer said.

Wireless Retail marketing VP Chris Cagle expects to take a less aggressive approach to promoting LNP. In its 1,000+stores and kiosks, the company “positions itself as offering choice and unbiased advice,” precluding it from using LNP “as a selling tool on principle,” he said.

“Basing a sales model on the churn approach is shirt-sighted” if a dealer wants to maintain good carrier relations, he added.

“A certain percentage of switching is good for business for all retailers because it generates more consumer activity and drives people to stores, where they might buy other products,” he continued. “But [switching] it will be driven by consumers themselves and by MVNOs that are not dependent on carrier relationships as an integral part of their business model, not proactively be retailers.”

Landline replacement carriers such as Leap Wireless will also heavily promote LNP, analysts and Leap added.

At least one major multicarrier chain is focusing on making the LNP introduction go smoothly at the point of sale, not on promoting the new consumer right. The chain is still waiting to see how its carriers “will develop their processes,” he said. In addition, the chain must prepare itself to answer numerous questions that consumers will raise, some of which haven’t yet been clarified by the industry or by the FCC, he said. One unresolved issue is whether the FCC will accept a landline carrier proposal that would sharply limit the number of consumers eligible to port their landline number to a wireless phone.

In the early days of LNP, the dealer warned, retailers who promote number portability run the risk of raising consumer expectations too high, in part because of these uncertainties and in part because some carriers will miss likely the Nov. 24 porting deadline.

“As it evolves, we’ll determine our strategy regarding the visibility of LNP,” but for now, “being overly aggressive at this stage is not in the consumer’s best interest.”