Device buyback/sell back/trade-in programs continue to create intrigue and show increased demand in the mobile marketplace. This week at Bamboo Mobile, we are offering our readers a glimpse of the latest Bamboo Device Buyback Matrix. Here we have compiled information from 22 companies and vendors that provide customers the option to trade-in, trade-up, buyback or recycle their used mobile devices. Information in our matrix includes channel type; incentive options; and the trade in process (including requirements). The matrix also includes analyst notes about program limitations, customer authentication and general observations. Currently, we are only looking at these programs as standalone and from the viewpoint that you do NOT have to buy a new device to participate. (This document does not include details on the new trade-in programs recently announced by AT&T and T-Mobile.) If you are interested in finding out more or purchasing the Bamboo Device Buyback Matrix, please contact Kate Pearce at [email protected]
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by Kate Pearce The wireless industry sometimes shows its tendency to be a bit “discombobulated.” Really, it’s no wonder consumers are so often confused about everything from service plans to coverage maps to all of the technology acronyms. The latest in the mix is the upgrade fury that started last week when T-Mobile launched Jump!, followed by AT&T with Next. This move by AT&T is only a month or so after it changed its upgrade policy from a 20 to 24 month requirement (Verizon did it earlier this year as well). But now, these same mobile operators are switching it up and offering early upgrade plans. This about face has the bloggers, industry pundits and others talking this week about the changing landscape… an un-subsidized, no contract wireless world. Surprisingly, even T-Mobile’s CEO John Legere got involved when he tweeted: "Did AT&T really just start charging full price for devices without discounting their rate plans? OMG. Really? #asktheschoolkids" So, T-Mobile launches Jump! on July 14th, and then a few days later AT&T unveils its Next upgrade plan (to launch July 26th). AT&T’s tag line for Next is: “Technology doesn't wait. Neither should you.” (Funny, AT&T thought in June we should all have to wait an additional 4 months.) However, as many of the industry pundits have pointed out, these new installment programs offer different options for consumers. Here is a comparison: Note: *$10 includes T-Mobile Total Equipment Plan. **AT&T customers may upgrade earlier but will owe the remainder of the installment payments. Matthew Miller from ZDNet was not too impressed with the AT&T option, saying, “It's good to see AT&T offering a no-interest equipment installation plan option with no down payment, but the reason I go with T-Mobile is that they also have lower priced plans to go with their no-contract policy.”
So, yes, AT&T has been criticized for basically giving the customers the option to pay full price for the device (upwards of $650) over time but then also charging them the higher service plan rates that other customers get when the carrier subsidizes the device. While it can be said that AT&T will offer better coverage and more services for the higher monthly rates, this new plan may appeal to those users who want a phone for under a 12-month period. AT&T also has no MRC for Next or a down payment requirement on the phone; Next is offered for tablets as well. (Note: Compass Intelligence primary research shows about 12% of mobile users upgrade every 12 months or less. Specifically, about 10% of users upgrade at around 12 months and 2% said at 6 months or less.) T-Mobile’s plan is slightly different in that you must pay $10 per month and an upfront down payment; however, the carrier includes its Total Equipment Protection plan with Jump! and offers lower monthly rates with no contract. Finally, T-Mobile customers who choose Jump! only have to wait 6 months to be able to upgrade, albeit they also have to turn in the old smartphone in working order. (Note: Customers most prefer lower monthly rates over discounted phones and the flexibility of no contract over discounted phones, according to Compass Intelligence primary research.) Not to be out done, Verizon is rumored to be coming out with its Edge program. Verizon’s program will supposedly allow customers to trade in their phones once they've paid off 50% of the purchase price. Perhaps a new upgrade plan will boost what are rumored to be weak iPhone sales for Verizon as well. Something else to think about is the naivety of the consumer today. They want the newest, brightest toy out there even when their wallets might say “no.” Also, customers will have to pay for that device whether they are paying high MRC fees for the service or finishing out paying the installments for that upgrade equipment plan. Will this be a situation where consumers will face another huge credit problem? The Register offered this biting account of the new plans: “Should you choose to play along, that two-year wait for a new device will be consigned to the dustbin of history, and carriers will have a lot of trade-ins to recondition and offer to smartphone and tablet newbies at more affordable prices, subsidized in part by fanbois and fandroids who want the latest shiny-shiny in their pocket or purse.” Finally, these plans -- while they do require a used phone trade-in and may increase the device recycling rates -- are really not eco-focused or provide any type of incentive to lengthen a device’s life-cycle. What they do set out to accomplish is to ease the subsidy burden on the carrier—the proverbial thorn in their side for many years. And, these programs are great for the fast movers i.e., those customers who need the newest devices at launch; they can acquire them now at a lower penalty. Finally, we’ll have to wait and see if Sprint (newly-acquired by Softbank and who just launched an unlimited plan for life) joins in or does something unique that not only helps the company’s bottom line, but offers consumers a simple, fair value and promotes (what it has long valued) responsible device reuse and recycling. For more information about the wireless industry, device reuse and recycling and services offered by Bamboo Mobile (and Compass Intelligence, please contact Kate at [email protected] At Bamboo Mobile, we continue to track industry trends and dynamics. One key area to investigate is device repair, protection, loss insurance, which may gain traction given the increased cost and value of smartphones. Therefore, most of the mobile providers offer some type of device repair protection, extended warranty or complete insurance coverage and theft protection. While this blog is not intended as a thorough view of this part of the industry, we have jotted down some high-level, basic offerings from the four top carriers. (Note: most of the prices quoted here are for feature phones/smartphones, not tablets.)
Note: All respondents provided an answer for each category of protection plans so %s overlap. Given that many mobile users are more careless than ever with their pricey gadgetry, (especially since smartphones are so highly embedded into our lives, they have a higher chance of getting dropped/spilled on/played with by toddlers/lost/stolen etc.) why do customers balk when thinking about insurance plans? Is it the price point? There are also deductibles (usually around $200) to consider with these plans so they don't always sound so appealing to the consumer. However, these devices-- at over $600 a pop full price--can become expensive to replace or repair if left without some type of coverage. The carriers may be coming around. Just in the last week disruptive pricing plans have been added that may increase adoption. For instance, T-Mobile's Jump! plan includes TEP and AT&T is strongly recommending its protection plan with its new Next trade in program (more on these plans coming soon from Bamboo). And then there are other 3rd party companies like Protectyourbubble.com that offer device insurance and can add creative pricing and messaging strategies to increase adoption rates for insurance plans. Stay tuned as we explore and uncover more information in this area.
For more information about our survey panel or to discuss other research needs, please contact Kate Pearce at [email protected] |
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Kate PearceBamboo, Chief Editor Want more from Us?Archives
October 2015
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