In Spain...Generation Y cannot get a cell phone contract!

As crazy as it may sound! it is true...I tried it myself...In times of economic recession, one may think that every business will do anything to get new customers, including mobile operators. However in Spain, this is not the case... Some of you might be thinking that it is crazy, and it is...so let me tell you the story. 

I am self-declared Blackberry addict, so whenever I came to Spain and saw that Vodafone was selling the new Blackberry Storm I wanted it. A month ago I went to a Vodafone store and filled some paperwork and signed the contract. A nice lady told me that I had to wait one week to get my phone, she said that I will get a call from Vodafone the day I was supposed to pick it up. 

A week and a half later, there was still no call, so I went to the store again but the lady was not there. So I talked to a fellow named Diego, who after a few minutes of looking for my contract, he told me that they were about to call me (I just laughed, he had my contract under some boxes of used mobile phones so there was no way he was planning on calling me that day) to tell me that my contract  could not be processed because my ID number started with "Y" (so it is not the generation Y that you guys were thinking... since October last year all spanish IDs start with a Y, since they already used all the number combinations for IDs that previously started with an X) 

It seemed weird to me so I asked him what should we do... and he told me that I should try another company!! How can Vodafone turn down an 18 month contract with an unlimited data plan from a person that was willing to buy a high end phone from them??

No idea, but they did... as some of you know I am doing a Master in Telecom, so we are always studying how operators can reduce Churn (the amount of clients that leave the mobile operator) and increase ARPU (Average Revenue Per User---basically how much money they make from each of us).  So I find it funny that these huge companies complain about this but then have people like my buddy Diego telling me that he doesn't care that I want to give money to Vodafone and that I should try another company. 

Luckily there are MVNOs in Spain (it stands for Mobile Virtual Network Operator, just think about a cell phone company that rents a network from a bigger Operator and sells plans and phones with its own brand- they usually target niche markets). After my frustration I went online and tried www.studentsphone.com and so far they have answered all my questions. Although they cannot offer me a Blackberry Storm, they offer me good customer service and answers, so it seems that I will get a contract with them. 

Too bad Vodafone... now I am looking for an unblocked Storm...I already found hundreds of them in Amazon. However this makes me wonder...Are traditional operators ready to tackle new generations? the Storm attracted me to Vodafone, but it doesn't mean that because they have the phone on exclusivity I have to beg to be their customer. The internet brings us abundance of everything, they don't want to sell me the Phone...hey! no problem!...I will buy it from Asia, the US, or maybe  England. Who knows...let's see who gives me a better price! 

this is the real Generation Y!

 

 

Why Google and Apple are thriving while Nokia, Microsoft and Sony suffer?

As a marketer I can say that Google’s advantage during the crisis is their “one to one” targeted marketing. By profiling most of us, Google can definitely offer advertisers something that traditional media cannot, and what is most important, at a very competitive price and business model in which an advertiser only pays when the campaign is successful. (adwords)

Marketing budgets around the world are being reduced in every industry as companies implement cost savings plans, however, nowadays, a company cannot stop getting its message across, and since mass media is still very expensive, Google provides an excellent option to budget constrained marketers worldwide.

With the introduction of services as Google’s Docs, Apps, Maps, Calendar….and so on, Google is getting more and more attention in their pages, providing Google with more channels from which to advertise as well as expanding the potential target market. 

Adsense also provides what seems to be a “Crisis Proof” Business Model, opening a blog, webpage or even launching an internet based company is easier every day, and people all over the world are looking for more revenues streams, and if I can build an interesting enough page and get some money from Google by letting them advertise…Hey, Why not? I don’t care if Google is also making money of it…

As far as Apple is concerned, it has already been 25 years since their world famous 1984 commercial ( http://www.youtube.com/watch?v=OYecfV3ubP8 ), and what surprises me the most is that they have been able to maintain their brand personality, always positioning themselves as innovative and away from the mainstream. The fact that they enjoy less than 10% market share in the OS industry (http://apple20.blogs.fortune.cnn.com/2008/12/01/mac-internet-share-hits-record-882-windows-drops-below-90/) proves that having a hip brand personality is not enough to be number one, but what Apple has done properly is leverage its Brand Equity and of course their innovation, to introduce new very successful products and services (iPod, iPhone, iTunes) to reach a more massive market.

Besides providing Apple with more Revenue Streams it also allows them to get into consumers that were unreachable with just offering a Mac, allowing Apple to successfully use “Product Bundling” to reach new generations. An example of this is the fact that if you are a student, you get a free iPod Touch if you buy a Mac, making it a very attractive deal for students that have to buy a laptop for school anyway and of course would love a free iPod Touch not to mention that the student will now be a member of the hip Apple community.

A proof of the success of this, is the fact that 60% of the freshmen class at Brandeis University in MA, USA took a Mac to school, (http://www.palluxo.com/2008/09/02/brandeis-university-40-percent-students-use-mac-computers/) of course “forcing” the school to use Mac friendly applications, hence lowering the “barriers of entry” of getting a Mac….creating a virtuous circle for Steve Job’s company.

One last very important fact in the current success of Apple…is of course Vista, the failure of Microsoft latest OS also contributes to Apple’s success. Why would you buy a Vista computer if you can buy a Mac (which actually works and it looks cool) and get a free iPod on top? Maybe Microsoft should start giving away iPods with their Vista computers; I don’t think that getting a free Zune will help much…

As far as Nokia and Sony (Computers and Mobile Divisions) goes, I believe they have failed in creating synergies among their different products, I can get a Sony-Ericsson mobile and I don’t get any benefit if I buy a Vaio. More importantly they have failed to turn their mobile devices into something more than just a mobile, an iPhone for example is a mobile, a PDA, an MP3 player, a browsing device and more and more a gaming device. While a Nokia is still a mobile, and in face of crisis, people will take longer to update their mobile, therefore reducing profits for the mobile manufacturer giant. 

The Red Pill....why and how??

Hello everyone! (although I believe, as of today the only readers are a few of my classmates from the amazing Master in Telecom and Digital Business at IE Business School). Although this blog has started as an assignment for my "Web 2.0 and Customer Driven Innovation" class, I am overly excited to be able to put my thoughts into a blog (which I have to admit, is my first one ever). Especially since I will be writing about technology, new trends, the present and the future and how this affects our everyday life and of course the way we do business ( I am at a Business School and absolutely love business). 

So.... why "The Red Pill"? as most of you know I take this from the movie "The Matrix" when Neo has to choose between the blue or the red pill in order to be able to see "The Matrix", as you also probably know, Neo took the latter and became the savior of the world. 

My plan with this blog is not to save the world (very hard to do it with a blog), but more to talk about the new technologies that are becoming part of our daily lives, hence changing the way we live them. I will try to keep it very informal, since I believe that it is more entertaining and has a personal touch as well.

My purpose with this is to be able to "translate" technological innovation  into simple language. I am not an engineer, I actually did Marketing for my undergraduate studies (I will be updating my Bio soon), but I have worked, lived and studied with Engineers, and I feel that there is a knowledge gap between all the great innovations that are happening and the knowledge that the common citizens have on the innovations. More specifically, businesses, since the common citizen really doesn't need to know more than how to use a tool such as Twitter or Facebook (although I plan to talk about how this companies make money out of our strange passion to know what is going on with our friends and the friends of our friends...etc etc, cause at the end of the day, these are companies and companies are here to make money).

But as we spend more and more time writing in our blog, updating our Twitter account, looking at pictures in Facebook, we are spending less and less time watching TV, listening to the radio, walking in a shopping mall, making it very very difficult for companies to reach us with their very expensive marketing campaigns. 

This poses a great challenge to all companies worldwide...the internet, and more specifically WEB 2.0 (it is not the version of your browser!!.., it is how we, geeks, engineers, IT guys or however you want to call us, refer to the way we use the internet today! , so in very very basic terms...WEB 1.0 was when you would go online and read the content of the web pages, WEB 2.0 means that now people go to the internet and upload their  "User Generated Content- UGC" another fancy term that we like to use, so just think about You Tube, Facebook, Delicious, Wikipedia and all those sites where users are the ones who create the content). 

So going back to our main topic, WEB 2.0 and the technologies that have been developed to be able to enjoy and even exploit WEB 2.0 (broadband, iPhone, Net PCs), have changed our lives, many new generations think that spending hours on the net is much more fun than spending hours watching TV. The problem comes when, companies, which want to sell stuff to these generations, want to reach them with their marketing message or how we marketers like to call it the "Value Proposition" but cannot because these potential clients (Mostly Generation Y) are spending their time in a place called "Second Life" and trust me, most of the Corporate Executives have no idea what Second Life is....so if they don't know the place how are they going to reach them??

So my plan here is to provide the Red Pill to all of my readers, show them the reality of our world today in terms of technology.  Since I am a strong believer of the power of goals and dreams, I should state that my dream and goal with this blog is to be the place to go for businessmen all over the world, I will try and  strive to make this the reference point for people that want to understand what is happening in the world in terms of technology and business. Since I know that I am not an expert in all the topics that I will be discussing about, I will love to hear your opinions and comments, also, I will try to have "Guest Bloggers" which I believe will add a lot of value to The Red Pill. 

Please check my related blogs as well, since this is an assignment for a class, I have 9 other very  smart classmates that will be writing about similar subjects, and of course if you want to read a professional blogger I encourage you to read our Professor Enrique Dans (www.enriquedans.com), he is actually the one who introduced the idea of the Red Pill to us, he even showed us the video from the movie so I just borrowed the idea from him. 

All right fellow readers, I will try to keep this as updated as possible, looking forward to hearing from you!

Alberto Sandoval Ponce