Question

Class - As the latest meeting of the management team of your mobile phone company begins, the marketing team passes out the results of the latest customer survey they performed. There isn’t much in the survey that is surprising, but the one thing that did stand out is that customers want some more information. They want data about the phones’ reception - how well the phones pick up the signal, how well they hang on to the signal, how often they drop calls, or whether they are susceptible to certain kinds of problems. As the marketing team explains, one of the reasons the customers want to know this is because of the iPhone 4, many customers of which noted that the phone dropped calls and lost signals when it was held a certain way. When consumers and journalists criticized Apple for producing a phone with a defect, CEO Steve Jobs claimed that the iPhone’s reception problems were caused by people holding the phone the wrong way and that most other phones from other manufacturers had similar problems. This claim was quickly rebuffed by executives from other mobile phone manufacturers. Jim Balsille and Mike Lazaridis of RIM, Sanjay Jha of Motorola, and Hui-Meng Cheng of HTC all claimed that their equipment performed much better than Apple’s iPhone. The problem was, however, that no one ever provided any data. All customers received were some vague claims that their phones worked great, but no one ever gave them any solid data, research results, or statistics. As your marketing team shows, customers want this data. They’re spending a lot of money to buy phones, and they want to know that it’s money well spent. It’s not as if obtaining or providing this data presents any difficulties. Already, cell phone carriers regularly provide equipment manufactures with dropped-call rates and information about how well specific phones perform on their networks. It’s just that no company makes this data public. So the question facing your management team is how to respond to your customers’ desire for more information. Do you take a radical step, doing what no other company in the industry does, and release information about phone performance to the public? Or do you just follow in the footsteps of everyone else and issue a vague assurance?

Questions 1. What are the advantages and disadvantages of releasing information about the signal reliability of your phones to the public? 2. How could you use this information to gain a competitive advantage over other manufacturers who do not publicize? Please write a 500-to-700 paper in APA Style answering all questions, and include at least 3 reputable sources.

Answer 1

For any cellphone company the marketing of its product depends heavily upon the performance of the mobile and also the features that it offers. To improve sales and add value to a product most companies tend to stress on all the features of the product that will increase its demand. In a highly competitive market no manufacturer wants to undergo the risk associated with publicizing any negative features or drawbacks of their product.

The major advantage of releasing information about the signal reliability of the phones to the public would be one of generating trust among the public that the manufacturer is more transparent. Another advantage would be in the form of customer reviews being more positive and aiding further sales, as any negative reviews due to high Expectations of signal reliability would be reduced. Also the manufacturer could educate the public on how exactly signals work and at many times it is not a defect in the mobile but the availability of the signal and the strength of the signal which is responsible. Advocate on open signal and how it works along with it website address can be included so that an informed consumer does not blame the mobile when the fault maybe with a signal.

The disadvantage associated with releasing information about signal reliability of phones to the public is of offering an unsolicited edge to the competitors. It is not necessary that if one manufacturer decides to release such information about signal reliability to the public all others will follow suit. To too many ill informed consumers this may appear to be a disadvantage as compared to the other products. As a consumer will ten 2 view it as a drawback and not understand that the other product may have a similar drawback but has simply not revealed the same. Actually the very art of marketing requires making your product more salable by highlighting all its positives and at the same time concealing the negatives associated with the product. Marketing consists of value addition to the product to maximize customer satisfaction as also to make the customer feel that it is getting adequate value for money. Any drawback of the product that maybe mentioned would definitely tend to reduce the value in the mind of the consumer, resulting in a price imbalance which may force the company to bring down its prices in comparison to its competitors, incase it wants to make such a disclosure.

I would utilise this information to gain a competitive advantage over other manufacturers who do not publicize, by focusing on educating the consumer and explaining the reasons signal drops and how they may at times be not related to the mobile instrument. I would also give a small explanation of what really the information relating to signal reliability means and how it is to be interpreted with regard to phones that belong to this particular segment. Spreading consumer awareness would result in the consumer considering this disclosure as transparency and an added advantage and either insist on the competition also making a similar disclosure, or else, have a tendency to consider the disclosure as positive rather than a negative. It is very important in this scenario to ensure that if we going for disclosure by the competition is not doing it the manner in which the disclosure is made and interpreted by the consumer would be of great importance and needs to be carefully planned and implement to be able to ensure that we can successfully capitalise on consumer satisfaction and trust.