Small Business Customer Service – A Lesson from O2 and the new iPhone 3G S

This week’s blog topic is all about O2 and the new iPhone 3G S (current model is iPhone 3G, new model 3G S).

Apple unveiled the new iPhone 3G S at yesterday’s annual Worldwide Developers Conference (WWDC) in San Francisco. Rumors of a new iPhone have been whirling around for months and months, so this came as no surprise. As detailed on the Apple website, the new features of the handset are:

• 2x Faster: The fastest iPhone ever. Load web pages, launch apps and more – faster
• Built in video camera: Shoot video, then edit it right on your phone
• Voice control: Use your voice to place a call or play music
• Compass: Let iPhone 3G S point you in the right direction
• Spotlight Search: Search across your iPhone from one place
• Messages: Send text, photos, videos and more

For those of us in the UK, the Carphone Warehouse and O2 will be supplying the phone to consumers from the 19th June 2009. However – anyone who already has an iPhone 3G (like myself) will face a huge charge if we want to upgrade.

There is limited information on the new iPhone 3G S on O2’s homepage; all current communication on the deployment of the new iPhone 3G S has come from their official O2 Twitter feed. From this, they announced that existing customers will have to buy themselves out of their existing contract, then purchase the new iPhone 3G S on a new contract. This is unlike the time of the previous iPhone 3G launch, where in order to make up for the disappointing performance of the first-generation iPhone, O2 allowed customers to break from their existing contract and upgrade for free.

For anyone who has a current iPhone 3G, the minimum their contract can have left is 6 months (for those who bought the iPhone 3G on the day of release, anyone else will have even longer). On a mid-sized contract of £35 a month, this equates to more than a £200 charge. Now many of you may think that this is pretty fair – why should people on an iPhone 3G contract get out of it, just because a new phone has been launched. And in a way you’re right – if I had a Nokia and Nokia released a new phone (which they do often), I would be laughed out of O2 if I demanded to be released from my contract just because I wanted the new version of my existing Nokia phone.

So why are O2 not repeating this offer of getting out of your contract for free – it’s because they know that they’ve got money coming in regardless. By forcing people with the current iPhone 3G to sit out their existing contract, they get a steady £35 (or whatever) a month from them. They can they can then provide new customers with the new iPhone 3G S, so their new stock of iPhone 3G S go on new customers, rather than existing ones. The iPhone is exclusive to O2 so we don’t have a choice. O2 know that even if they make current customers really, really angry – it’s tough. We can’t exactly take our business elsewhere.

But the problem here is that the majority of iPhone users are (or were) fiercely loyal to the iPhone – these are the people you saw on the news queuing up overnight to make sure they got their mitts on a new iPhone 3G on the day of release. And why did they do that?? Because O2 had allowed them to get out of their existing contract with the first-generation iPhone and just pay the money for the new phone alone. These people made the iPhone 3G (and in turn O2) a huge success. These are the people who blog about it, tweet about it and convince their friends that they can’t possibly live without one! But do you think these same people will be queuing round the block in the rain if they have to pay £200+ to get out of their contract, plus the £274.23 to buy the new phone?? We’re in a recession, and even the most avid of iPhone fans are unlikely to be willing to drop that amount of cash just for the prestige of having the latest iPhone (the new features really aren’t worth that much money, and anyone on with an iPhone 3G can get a software upgrade free anyway). And anyone who doesn’t already have an iPhone is unlikely to be mad enough about them to queue like that.

Another problem for O2 is that as well as the rumours of a new iPhone launch, there have also been rumours that other networks will soon be allowed to sell the iPhone. If this happens, O2 will soon find that all these unhappy iPhone 3G customer may well up sticks and leave to a provider that will be more competitive and who treat their customer with a bit more love and care. So by angering their existing iPhone 3G customers, O2 are taking a big risk.

So, watch the news on 19th June – will people be queuing outside (hopefully not in the rain – come on British summer!!) all night long to get their hands on the latest release? I doubt it – and if they are they’re probably actors/O2 employees etc, who’ve been paid to do it! I can just see the new launch being a flop – because O2 are alienating the people they need to make it a success.

The moral of this story? Just because you may have your customers held over a barrel, it doesn’t excuse you treating them badly. This is a lesson that can be applied to all businesses – large and small. If you’re a small business providing a service that no-one else does, or if you’ve got customers locked into a contract – it shouldn’t affect the way you treat them. Never assume that you can ignore them or give them a second rate service just because they have no choice. Customers are king as far as small businesses are concerned and you should treat every single one like gold-dust!

Leave a Comment June 9, 2009

Small Business Branding, Logo and Corporate Identity – What’s the Difference?

Okay small business owners, I have some questions for you here:

1. How many of you reading this, know what your logo is? (I’m really hoping you’re nodding along, safe in the knowledge that you know what your logo is! I’ll be scared if  you don’t, unless you’re just starting a new business and haven’t had a logo created yet…in which case, get in touch, we’d love to help!)
2. Great, number 2, how many of you know the difference between your logo and your corporate identity? (From our experience, approximately 60-70% of people reading will know) 
3. And finally, how many of you understand the difference between your corporate identity and your brand? (this is the biggy – and I’m assuming that some of you might not be 100% sure of the answer here…)

It is really is important for your small business, that you understand not only the differences between these key elements, but also how they work together to form the overall impression of who your company (or personal brand) is… So here’s a quick and easy guide to the differences and how they all work together:

Logo: It is rare that a company, even the smallest of small businesses, doesn’t have a logo, even if it’s a simple word, mark or symbol that someone internally has created to serve as your identifier. A logo can be made up of a different parts, which may or may not always be used together; the word mark, a logo symbol, a tagline.

Corporate Identity: These are the elements of your small business’s graphic/identity/visual language, and are usually, but not always, devised from the elements that make up your logo. If you have worked with an marketing agency (such as SMEketing) to develop your corporate identity, you must ensure that they provide you with a manual, commonly known as the Brand Guidelines  (also called a brand manual) as part of the package. This will guide you, your team and suppliers, as to how to correctly utilise your corporate identity. It safeguards your investment in your brand and prevents it from being diluted.

Your corporate identity is made up of symbols, textures, colours, images, photography style and fonts. If you’d like to see an example of some brand guidelines get in touch with us and we can send you some examples of ones we’ve created for past clients.

And all of these elements come together visually in your marketing material (business cards, stationery, website, brochures, forms, email marketing, signage, advertisements, vehicles, etc) to express your corporate identity. A strong corporate identity is one that maintains a consistent use of the elements to achieve quick recognition by a potential client when they come in contact with a marketing piece.

Brand: A lot of people will tell you that your brand IS your corporate identity, however it is much much more than that. A Brand is the sum of ALL parts that make up a company. It includes your logo, your corporate identity, and any and all of the follow elements:

• your company name
• your company culture
• what customers have come to expect from an interaction experience with your company
• team uniforms
• company policies
• tone of how your written content is delivered
• corporate identity
• logo
• tagline
• word of mouth advertising (how your current clients & suppliers talk about you when they refer you)
• partner relationships
• sponsorships
• the space you work in
• and many more..

To summarise, your brand is what people come to expect from your company, whether it be from seeing an advert in a magazine, to ordering a product online, to interacting with a team member over the phone or in person, and so on. And with any great brand these elements are always consistent and congruent.

Developing and maintaining a corporate brand is essential in modern business. SMEketing can work with you and your small business to develop your brand and carry it through all your marketing efforts.

Speak to us about logo design, company stationary, website design, copywriting and more. See our Services page for a full list of marketing solutions we provide.

Our small business marketing agency is based in Hampshire and service all of Hampshire, as well as Wiltshire, Dorset and Surrey, Sussex and Berkshire (and of course the Isle of Wight – in fact it’s so lovely over there we’d welcome the excuse to visit!).

2 Comments April 6, 2009