March 14th, 2013
Selling new concepts to consumers is often problematic. Many home owners faced with door-to-door electricity salesmen in the late nineteenth century probably argued that their gas lights worked fine, and they were worried about the potential disruption and cost of installing electric cabling. It was the same switching customers from dial-up to DSL broadband in the 2000s, though a decade later few would argue against the benefits of broadband.
Now early Ultra-Fast Broadband retail service providers (RSPs) are battling similar perceptions from their residential customers, industry figures say.
Terry Coles, founder and Managing Director of Tauranga-based EOL, says one of the biggest barriers facing RSPs all over the country is the mistaken belief from residential customers that getting UFB will cost a lot and changing over will be difficult and disruptive.
“There are a lot of misconceptions about UFB – and they are deeply-embedded. For example, people think installation will be expensive and there will be on-going costs. Actually it’s free to the gate and we are offering free connection and free routers. And most people find the cost per month is less than they are paying at the moment.”
EOL recently sponsored the UFB connection for the city’s new entrepreneur hub, Ignition, as part of its campaign to change locals’ perceptions. And the company’s website features a broadband calculator encouraging potential customers to “find out what [ultra-fast] internet with EOL could save you”.
The language used to sell UFB to consumers over in coming months could be crucial in residential UFB uptake, according to a major research study commissioned recently by Chorus.
The study found that promoting UFB around the concepts of “speed” and “reliability” was potentially problematic, says one of the study’s authors, Colmar Brunton National Qualitative Director Spencer Willis.
“If you talk about ‘reliability’, that implies there is a problem with their existing provider. If customers don’t see a problem, why do they need to switch? And ‘speed’ doesn’t mean much to consumers. If it’s ‘more of the same, but a bit faster’ there’s no interest.”
Instead, Spencer uses the example of a busy mother. It’s 5pm, she’s home from work and preparing dinner in a hurry. She gives her two kids (aged five and seven) their internet screen time to keep them out of the kitchen. The problem is that the internet gets busy in the early evening. So instead of uninterrupted cooking, she is often involved in sorting glitches (buffering problems, the connection dropping out, a computer go-slow). And there are nightly arguments over who got more time. (“The game loaded quicker for her, so I should get an extra five minutes” etc.)
For this mother “speed” isn’t the problem – she wants “consistency”; a service that works properly – always. In the same way that she can pretty much guarantee that the stove will light when she turns the dial, she wants an internet connection that just goes.
“That mum will pay money to make her problems go away. What she wants is when the kids sit down to play at 5pm, the internet always works,” says Spencer.
At Northpower Fibre, the Crown Fibre Holdings partner for Northland, Public Relations Manager Steve Macmillan agrees that the test for residential UFB in 2013 will be how to sell the benefits.
“The big challenge is getting people to recognise it’s easy and the pricing points are compatible with copper. A lot of people think it’s expensive, and a hassle and inconvenient. The attitude is: ‘It’s just flashy copper, why should I bother?’”
By the end of 2012, Northpower had passed 11,000 Whangarei properties, had 8000 ready for connection. It is expecting to have laid fibre outside 18,000 homes and businesses by the end of 2013. Steve says that although the company has done plenty of strategic work around its rollout marketing and communications strategy, its initial marketing push in 2013 is probably going to involve being “somewhat simplistic”. The message: it’s not expensive, it’s not difficult, it’s not inconvenient.”
The other marketing priority for this year, Steve says, is to make the move to UFB easy for customers. Until now, one of the problems for potential users has been not knowing how to get a connection. Local residents see the cabling going down their street, but their existing internet provider may or may not be able to offer UFB, and it’s hard to know what the other options are.
“As partners we need to take that hassle away from them – make it easy. Nationwide it’s going to be a struggle to get uptake unless we get people to understand it’s quite an easy ride.”
While local fibre companies have an obligation not to favour one RSP over another, Steve says the practice of fibre companies listing all the RSPs that have signed up to potentially provide UFB is just frustrating customers. Instead the companies laying the fibre need to only point customers towards providers that are actually connecting houses up.
“We don’t want to waste the time of potential customers by having them ring and email companies that can’t help them yet, so it is important through our 0800 number and our website to let them know which RSPs are live. We have to be a facilitator, a leader and increasingly have a public voice and lead the chat.”
So far Northpower’s messaging has been principally around the progress of the UFB build. But that will change in 2013, Steve says, with a big push through advertising, social media and newspaper reports around key values of UFB.
“We need to get a common messaging out there:
- You don’t know what you were missing until you have experienced something else…
- Fibre is faster than copper
- Fibre gives you more options than copper
- Fibre is just as affordable and potentially cheaper – you get more from your dollars.”