Orange dumps on its customers again...

[Killahurts]

Dealers puzzle over £50 Orange upgrade charge

Dealers are perplexed by Orange's decision to reinstate its £50 upgrade charge for its low-spending customers whose initial 12-month contract has elapsed.

Orange is charging customers an extra £50 upgrade fee to customers who spend less than £30 per month, and have been on a contract for between 12 and 18 months.
Ian Robinson of MoCo said:

"Even if a customer is a month out of contract you'd think Orange would want to sign them on to a new contract.

"Is Orange saying that the other networks are welcome to their low-spending customers? If it doesn't apply to Orange's own sales routes or, especially, the likes of The Carphone Warehouse, independent dealers will be very upset. Customers are clever. If the service is comparable between retailers, they are going to make their decision based on price".

Andrew Culverhouse, of Time2Talk in Potter's Bar, said:

"They are charging the customer to extend their contract. This is unfair. It would appear Orange is trying to impose an 18-month contract. It seems that Orange is saying, 'If your contract's up, you are a low-spending customer and you want an upgrade, then go elsewhere.'

"We try and upgrade a customer and find out that they have to pay £50. In one respect it could benefit us switching them to another network".

A spokesman for Orange said:

"It applies to all Orange customers and all retail routes across the board. It's actually a reintroduction of an old clause. It existed before. We are going back to what we did before".

Source: Mobile News

[Gunner]

That's really strange :\

I've never understood why networks don't give decent deals to upgraders anyway - to add an extra £50 charge is going to be a nightmare for the retention team!

Christ... you can get a Nokia on Three for a whole year for that much money :|

I hope they know what they're doing...

[Killahurts]

We agree for the first time today!

It just shocks me that the one network losing significant numbers of customers at the mo is deciding to penalise a significant number of its customers with an extra £50 - on top of any normal upgrade charge they may have to pay.

Make absolutely no sense and is only going to turn dealers (as well as customers) against them

[hotphil]

Looks like I'm off to another network in two weeks then

[Killahurts]

I'm sure you wont be alone mate - this policy is madness.

Out of interest what network are you likely to switch to?

[Gunner]

I'm still trying to work out why Orange have done this in the face of the competition. Could they really be trying to craft a high-spend userbase and maybe drop a mil or two users?

I'm further confused by their Premier package - basically, if I remember, with a £50pm contract you get priority customer support and a bit of free data.

It just seems a bit niave to me. Surely they have room for both markets? They've got a massive network, and I know you'll disagree with me from your experiences Killahurts, but they're not the worst of the bunch.

:confused:

[Killahurts]

Maybe you're right - maybe they just dont care about the average punter.

But with their ARPU lagging well behind 3s I can only assume they are gonna have to dump more that 10-15% of their customers to play catch up.

Its just a bad move - and worse still is the fact that you can bet your live Voda will be watchin to see what effect it has.

If they think they can squeeze a few extra quid out of their already overpriced customer base my bet is that they will...

[haveagoade]

There are no if and buts about it. :mad:

Orange dont want your custom if you dont meet their spend targets.

I'm a low spend customer and the CS rep had the bare faced cheek to tell me at the end of my contract they didn't really need custom like myself.

They dont OVP anymore if it dont suit them. So where is the value and where is the promise? :rolleyes:

I'll say it again ORANGE is now run by a load of dull accountants and people with no guts and innovation. They all left when Hutchinson sold orange to France telecom.

Bring on the competition.

[A1c]

Every company has its own strategy to make money and it's pretty likely that all of the mobile operators will have to reposition themselves in light of the falling prices and increased range of services becoming available.

I don't think its at all good that anyone who has been a customer should be told that their business is unwanted, very cheeky.

That said one cant judge a company on its target market. After all not everyone can afford a Porshe but you cant hold their marketing strategy against them because they specialise in producing cars for one particular market segment.

The big shake-up continues apace and its clear that things wont settle much before the end of 2005. There are just so many variables right now with new MVNO's, new networks, new services and new products all competing to gain share. Orange may loose some ground in the intrim but market confidence seems to suggest that overall their long term strategy looks a safe bet for customers and the investors, the latter being the ones all companies need to satisfy to survive. (Of course they can only manage to do that if they invest in the customers that offer them the best prospects for a return on their capital).

[new2three]

I have to agree with the last comment. There are many people who only use their phone for emergencies, and there are many customers who do not spend a great deal of money topping up or have low off peak tarrifs.

Orange have mad a bad decision if they are turning customers away who want to upgrade, plus the additional £50.00 upgrade fee is in my opinion daylight robbery.

What is the logic behind their decision!!!!!!!!!!!!!


Everone has a right to own and use a mobile phone the way they wont.

Mobile phone operators who use this tactic deserve to loose customers hand over fist to a network that appreciates all customers whether they spend £15.00 - £100

[haveagoade]

Yes thats all very well to say that the market has faith in orange thats all that matters.

They all had faith in the likes of M&S Sainsburys etc etc untill it was realised that succesfull companies need inovation and guts and to lead the market and not run the company with a bunch of accountants sitting in an office counting beans.

You gotta praise 3 for innovation and guts.

and ****** whats telcoms got to do with cars?

Is my conversation on my mobile a Lada

and someone elses conversation a fancy overpriced german car?

[Killahurts]

Thats not just out of order thats disgusting of Orange to say that!

The new £50 fine they are imposing upon people will only speed up their decline and see even more customer leave them in the near future.

[A1c]

There will always be some company who will try and offer low-spenders a service but one simply cant force all companies to abide by the same strategy. As the market matures expect to see more specialisation, more targetting and more diversity.

It'd be impractical for every company to cover all market segments. Its happened up until now with mobiles because of the explosion in terms of take-up. Now that everyone has a phone (Just about - some have more than one!) specialisation will play a much more important role.

Consumers are very brand oriented and attach specific values to things. Good old VW makes a mint out of selling the same chassis in numerous guises satisfying the needs and image ranging from those wanting a plain family hatch (Golf) to a high performance sports coupe (Audi TT). They are very careful to ensure that they are sold through entirely separate networks so that different customers get different experiences.

In time your mobile network provider might just be a clue to your purchacing power just like your supermarket shopping bag. The well off carrying Marks & Spencers, the less wealthy sporting the Lidl bag! Moving to an upmarket position differentiates a product and sometimes (although it seems strange) a higher price produces a percieved higher value - just ask BMW owners why they are happy to shell out 1000's more than they would for a comparable Ford or Nissan.

What Orange appears to be doing is looking to position themselves as a 'premium' brand for higher spenders. That is their privilage and sometimes that can work well. The problem for all of the mobile networks now is trying to avoid the feeding frenzy for cheap deals that are unlikely to make them any profit in the future. I'm unsure as to how things will settle on this point, but I can appreciate what is happening, see the logic and understand why the numbers game is now less important than the quality of customers for the established companies.

[new2three]

You only have to look at companies who have tried to target particular customers. M & S, and Sainsburys are now loosing customers to the likes of Tesco and Asda.

Orange are going the same route. I remember they (orange) tried to impose the £50.00 upgrade fee about four or five years ago. It was discreetly stopped because the Directors at the time realised there mistake. Now there is a new kid on they block.

[A1c]

Only time will tell who has the right approach but one ting is for sure they cant all have the same strategy!

Jury is out on this one, perhaps a good idea to check back in 2006 and see which companies have made the best decisions. Far too difficult to speculate about such a complex and changing market, but that's exactly what the networks and 3rd party providers have to do! Nothing ever stands still eh? Just as well as discussion would dry up!

[haveagoade]

Yeah too true we're not all gullable Snobs.

Its what you SAY and HOW you SAY it on your mobile that distinguishes you not your poxy provider.

[A1c]

'Its what you SAY and HOW you SAY it on your mobile that distinguishes you not your poxy provider'

And thats why all BMW and Merc drivers can be distinguished by constantly using their machines to thier full capacity.... that's why they buy them eh? Nothing to do with the badge and the image? Same goes for tellys.... what you watch says a lot about you but so does what you watch it on! I suspect some networks are now quite keen to establish some image of quality that delivers a premium. Noubt wrong with that really!

[haveagoade]

Now you are being a SNOB

[A1c]

Hardly.... just being a realist. Go study some branding and marketing and you'll get with the program. Unless you aspire to live in some stalinist society (DPRK maybe) its how commerce works. Technology is like everything else and some pay huge premiums for better products (as is their right). You buy an image with everything - get used to it - its called the capitalist system and it has produced the wealth this country was built on. Not perfect for sure but a better alternative has yet to be proven to deliver.

[Killahurts]

Hardly.... just being a realist. Go study some branding and marketing and you'll get with the program.


As someone who works in the PR industry unlike certain others I can talk about branding and marketing with authority.

And what certain people forget to add to their argument is just because you market something as a premium product - it doesnt actually mean its any better than the cheaper product.

Indeed it certainly doesnt mean that the gulf in price is reflected in the gulf in quality.

Was my Orange tariff worth the extra £1000 a year I was paying over 3 - not at all.

I was paying the extra for a service that had worse CS to that 3 provides now, that had slightly better reception and a wider range of phones.

Did I feel any better when I had an Orange phone - no

I feel better with an extra £100 to spend every month.

So to me Orange was a classic example of an established brand that was living on its marketed image and not what it provided me in terms of service or value.

And thats why many established premium brands wither and die - because they fail to move with their customer needs when people realise you can get something just as good for a lot less dosh...

And that could be why Orange are suffering at the hands of 3 now...

[mweb]

Orange are no more a premium brand than BMW. their are more 3 series sold in UK than Ford Mondeos. its the perceived brand image that in reality is non existant ;)