Yesterday I wrote about my recent experience with Sprint. You can read it here. After reading John's comment on that post, I had a few additional thoughts:
Today Sprint announced its quarterly profits, $195 million. That makes the roughly $30,000 they will not get from me over the next 40+ years seem small in comparison. In reality it's not. If just 6,500 customers switch from Sprint to a competitor, Sprint loses $195 million in potential revenue over the next 40 years. I'll bet my lunch Sprint loses that many customers a week.
So what could Sprint do to keep its customers? Consider the whole cell phone experience. It's lousy. Rather than spending millions on acquisitions, they could spend a bit of the marketing budget in ways that reinforce a customer's decision to use Sprint. Here are a few ideas (Sprint, are you listening?):
Sprint gives a free or significantly discounted phone to every new customer. But their existing (and best) customers get nothing. Why not offer customers in good standing the opportunity to upgrade their phones free every year (without extending a service agreement)? How about free ring-tones, wall paper, or accessories on a customer's birthday? How about a free month of service for every year as a customer? What if they refunded a portion of the monthly bill to customers who habitually use fewer minutes than they pay for? This would tell me they are looking out for my best interests, not theirs. Or what if they provided free sports scores, stock info, or new briefs to customers who continue to use Sprint even after their contracts expire?
I don't know much about Sprint's acquisition costs, but the costs of any of these perks would pale in comparison. And if they added even a few months of service to existing users, wouldn't they be worth it?
Sprint's customer base is like a leaky bucket. In any given month, thousands of old customers leak out and thousands of new customers are poured in. There are two ways to keep the bucket full. You can add more and more customers. Or you can plug the leaks and keep the customers you already have. Most marketing programs (and virtually all advertising programs) are designed to pour customers in. Which is too bad because you gain more by plugging the leaks and thrilling your customers.
Thanks John for your comment. I'll look forward to hearing about your experience.