Sprint PCS, Nextel Lead Online Pack, Study Finds

Posted: 11/2001

E Channel

Sprint PCS, Nextel Lead Online Pack, Study Finds

By Josh Long

Smaller U.S. carriers are doing a better job acquiring customers online and enticing their current subscribers to spend time on their web sites than giants Verizon Corp. and Cingular Wireless
LLC, according to a recently released Jupiter Media Metrix report.

Sprint PCS and Nextel
Communications Inc. convert almost three times as many web-site visitors to pages secure for transactions than the top two wireless carriers, Verizon Wireless and Cingular, the research firm found.

Secure pages indicate either visitors appear ready to make a purchase online or are reviewing their current accounts.

Sprint PCS and Nextel convert 66 percent and 62 percent of their visitors to secure pages, respectively, compared to 23 percent for Verizon Wireless and 12 percent for Cingular, Media Metrix ratings data show.

Verizon Wireless spokesman Brian Wood says the carrier consistently has increased the volume of sales on the web, and that it has improved its web site.

In May the carrier said highlights of the redesigned web site include customer service information, plans and pricing comparisons, an equipment page including 3D phone demonstrations, a price plan map and calling features. The site also features Internet and data information and a text-messaging page, which allows visitors to send a text message from their PC to a Verizon Wireless customer using a digital handset.

After Verizon Wireless upgraded its web site, the carrier realized that its daily online sales run rate almost doubled, and page hits nearly tripled by May, compared to the first quarter, Wood says.

“It is still a growing channel for us,”

he says.

Cingular declined comment on its


According to Jupiter Media Metrix, Sprint and Nextel have been effective in encouraging their customers to access their web sites. Sprint, for instance, tells its customers on a customer service telephone recording that they probably could resolve their questions faster and easier by visiting the carrier online, says Jupiter Media Metrix analyst Dylan Brooks.

However, Brooks cautions that as carriers encourage people to visit their web sites through various distribution channels, including traditional advertising, they must be careful not to alienate people who may not be web savvy or inclined to spend time online.

Brooks says Nextel has carved out a niche among blue-collar workers, especially those working in manufacturing or construction trades, who need to access information remotely, such as inventory, on a wireless device.

Brooks says that on average, wireless carriers generate between 1 percent and 1.5 percent of their total revenue online, but many of them anticipate growth up to 4 percent of revenue online next year.

Analysts say a strong e-commerce strategy is important for consummating sales online, and it can strengthen relationships with customers and draw potential subscribers to outlets in the real world.

For every online sale, 10 transactions are made outside cyberspace as a result of research shoppers conducted on the web, says Brooks.

He also says that carriers should encourage Americans to access the web because it gives them greater visibility regarding data services available on wireless devices. As he puts it, carriers need to let “people know they don’t have to wait for 3G. There is lots they can do with their phones today.”

Large U.S. carriers have not been very successful educating people of even simple data capabilities such as text messaging, a wildly popular service in Europe, which can be accessed over any digital network, according to Brooks.

He says that a billion text messages are sent in the United Kingdom and Germany each month.

Jupiter’s report also found:

  • AT&T Wireless Services Inc., the third largest U.S. wireless carrier, converted 38 percent of its visitors to secure pages, lagging behind Sprint PCS and Nextel.

  • VoiceStream Wireless Corp., the smallest U.S. wireless carrier among those included, converts 53 percent of its visitors.

In related findings, Jupiter says online advertising doesn’t always draw people to a carrier’s web site.

Data from AdRelevance, Jupiter Media Metrix’ online tracking service, reveal:

  • Although AT&T Wireless purchased nearly 500 million ad impressions from February 2001 to April 2001, Sprint PCS has been more effective in drawing customers to its site with about 100 million ad impressions during that same time period. Each carrier averaged 1.5 million unique visitors during the time period.

  • Despite buying about 100 million ad impressions, Cingular has experienced a decline in unique visitors, from 1.4 million in February 2001 to 760,000 in March 2001.

“Sites with high traffic and low secure page rates likely need better design,” says Brooks.

Master Agency Selects Simplexity Wireless Solutions

By Josh Long

U.S. Telebrokers Inc., a national master agency, has signed an agreement with Simplexity Inc. to use its web-based online comparison and ordering engine to facilitate the sales of wireless products and services.

A joint statement by US Telebrokers and Simplexity says US Telebrokers chose Simplexity’s Xact Solution, which will allow agents to offer their customers about 4,000 different wireless products and services. Agents also will be able to view side-by-side comparisons of wireless phones, accessories, calling plans and information on promotions.

Under the agreement US Telebrokers, a subsidiary of Scottsdale, Ariz.-based PlanetOne Communications, and Simplexity will share commissions. Simplexity is charging US Telebrokers, not its agents, fees associated with offering a private-label web site, says Ted Schuman, CEO of PlanetOne Communications.

Nearly 100 agents who responded to a brief survey said they were interested in providing a cellular solution to their clients, according to Schuman.

The agreement with Simplexity allows agents to offer customers wireless services without having to perform the tasks that normally require lots of time and cash, he says.

US Telebrokers, through its network of agents, does not want to directly fulfill orders, program and deliver phones and provide customer service — all burdens Schuman says crippled his company’s successful relationship with Motorola in the early ’90s. US Telebrokers broke off the relationship — whereby agents represented Motorola’s wireless products and services in a traditional direct sales model — with the wireless vendor after about a year, Schuman says.

In contrast, under this new agreement wireless carriers directly provide customer service and other types of support to customers after orders are fulfilled through Simplexity’s online solution. Schuman says agents can compare services and products offered by 31 nationwide carriers.

He says nearly a handful of companies offered some or all of the wireless solutions US Telebrokers was seeking, but Simplexity had the connections in place to close the deal.

Simplexity president and CEO Mike Ferzacca was part of the sales management team at Cable & Wireless, where he negotiated long distance business with US Telebrokers for several years.

Other senior executives at Simplexity also are former Cable & Wireless employees. The previous relationships based on success and trust gave Simplexity a leg up over competitors in the negotiation process, says Schuman.


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