Ken’s Tech Tips Index: How did the networks do in the run up to Christmas?

In our latest study into the performance of each network in the run-up to Christmas, Tesco Mobile takes the title of the best performing network followed by Three and T-Mobile.

What is the Ken’s Tech Tips index?

The Ken’s Tech Tips Index is our regular study looking into how well each mobile phone network is performing in terms of attracting new customers and retaining existing ones. We polled 6,145 people through our PAC Code Finder tool on their intention of switching network. From the answers, we determine how rapidly a network is gaining new customers and losing existing ones. The Ken’s Tech Tips “index score” is “the number of customers who join a given network for every 100 customers who leave that network”.

If a network has a high score in the Ken’s Tech Tips Index, it means they are gaining customers a lot faster than they lose them. This is perhaps a good indication that the products they provide are better value for consumers (or alternatively, it could just mean they are doing a great job with publicity or sales).

A score above 100 in the index means that network is gaining customers faster than it is losing them. A score below 100 is bad news: it means the network is losing customers faster than it can replace them.

There are two ways by which a network can improve their Ken’s Tech Tips Index score. They can either attract more new customers or they can better retain their existing customers. The ways by which a network can do this are to provide better value to new and existing consumers, better customer service and to improve their customer experience.

We previously ran this study in September/October. This latest study considers the 60-day run up to Christmas (October 20th to December 19th) – what might be considered the most important part of the year for mobile operators.

How did the networks fare in the run-up to Christmas?

This study was run across 60 days (October 20th to December 19th). We asked users of the PAC Code Finder tool the question “Select your current network provider and the network that you wish to move to” and received n=6145 unique responses.

• The best performing network again was Tesco Mobile by some margin (311 new customers for every 100 customers who leave the network). Three are runners-up (144 new customers for every 100 customers who leave the network).
• At the other end of the table, O2 and Virgin Mobile are the worst performing networks (62 and 64 new customers respectively for every 100 customers who leave).
• The most improved network in the run-up to Christmas was T-Mobile who moved from last place in our previous study to third place.

The results of our study are shown below with the results from the previous study in brackets for comparison.

Rank	Network	Ken’s Tech Tips Index (higher is better) (results from previous study)
1		311.2 (484.6)
2		143.6 (188.5)
3		123.5 (67.1)
4		103.3 (93.1)
5		95.8 (94.8)
6		63.5 (78.3)
7		62.4 (74.7)

Why are Tesco Mobile and Three performing so well?

• During the period of this study, Tesco Mobile has been running a 500 minutes, unlimited texts and 1GB internet for £10/month SIM-only promotion. This tariff has been hugely popular and has most likely attracted a lot of customers who originally purchased a smartphone in the run-up to Christmas 2008. These customers will now be coming to the end of their 24-month contract and will be switching to SIM-only alternatives.
• Three are continuing to attract customers with a range of incredibly competitive tariffs and a large selection of the latest smartphones such as the HTC Desire HD, iPhone 4 and Blackberry Torch. Three’s SIM only tariffs are also very competitive against the backdrop of the rest of the market. Although Three maintained their second-place position in our index, there was a drop in their score from 188 to 144. We believe this is partly down to the popularity of Tesco’s SIM-only tariffs which will have taken business away from Three’s offerings.

Why has T-Mobile improved so much?

T-Mobile and Orange enabled roaming across each other’s networks on October 5th with both networks launching a large publicity campaign around the new roaming feature. This has most certainly benefited T-Mobile more than Orange as there was certainly a perception that T-Mobile’s network coverage was poor before roaming was enabled. T-Mobile also launched a promotional £5 tariff to coincide with the new “roam on Orange” feature.

This is likely to have been a significant factor in increasing T-Mobile’s score in our index. Other contributing factors would include a strong pre-Christmas Pay As You Go push and a much-hyped Heathrow flash-mob advertising campaign.

Why are Virgin Media and O2 performing so badly?

In this study as well as our previous study, O2 and Virgin Media have performed badly. Both networks have lost more customers than they have gained (gaining 62 and 64 new customers respectively for every 100 customers who leave. Again, it’s difficult to point out one specific reason for the poor performance of these networks. Neither O2 or Virgin appear to have generated much publicity in the run-up to Christmas nor have the two networks launched any particularly eye-catching products.

O2 are disadvantaged by the fact that many iPhone 3G and iPhone 3G S customers are now approaching the end of their contracts. Whilst iPhone customers previously had to use O2 due to the network exclusivity deal, they are now free to use the iPhone on any network. As users either upgrade to the iPhone 4 or switch to SIM-only alternatives, they are realising that rival networks such as Tesco Mobile and Three are offering much better value than O2.

Notes on our study…

• Our study measures intention to switch and not whether customers actually go ahead and make that switch. However, we expect this data to be strongly correlated.
• Our study also fails to consider customers who may switch network but decide not to switch number (customers who don’t use a PAC Code). Our study also does not consider mobile broadband and tablet tariffs (for which a PAC Code is not required to switch).
• This study considers people who switch network and port phone numbers between October 20th and December 19th. Many Pay As You Go phones purchased before Christmas are likely to have been purchased as gifts and will be activated on or after Christmas Day. We would not see the activity from these phones in this study.
• The sample size is n=6145 users of the PAC Code Finder tool. We have only analysed data in aggregate form and no personal details are collated during this study.
• We have excluded Asda Mobile and Giffgaff from our index due to limited data – so few people (n < 100) said they were switching from/to those networks that our results would have had incredibly large error bars. Had they been included, they would have scored 164.9 and 520.0 respectively. Given that Giffgaff is such a new network, we would expect them to have a high score simply for the fact that there are very few existing customers who are able to leave the network.

Please contact Ken if you have any further questions on the study or to request an information pack detailing the study.