What makes a company successful?...

... delivering products and services that are relevant and create impact among consumers.

I combine my expertise as a Marketing executive in a Fortune 500 company and my passion as an investor to find the Companies that I think have "cracked the code" with consumers. Advertising does work. When I see a new product that fits relevant consumer trends, and that is supported with a campaign that I find particularly shrewd and innovative, I know that Company is potentially a great investment.

One of the great investors of all times, Peter Lynch, recommends to "buy what you know". You watch TV, go to the supermarket and walk around everyday. Observe... look around: what you see can make you money in the stock market. Now, let's be clear: a Company is not good just because it advertises. What we have to look for is great products supported with -and enhanced by- great advertising. The principle is simple: if something is good enough to draw your interest, it will be of interest to millions of persons just like you.

It is my goal to share with the reader my findings in the world of marketing which I think will turn into great returns for investors. Profit from it!

Sunday, June 6, 2010

A case for Sprint

My case is simple. I submit that Sprint (S) doesn’t deserve the poor reputation it has among most consumers anymore. And I expect that sooner rather than later consumers will realize that Sprint is a very smart choice. My case is based on Sprint's sound marketing and on my own experience. It’s based on alluring benefits that are difficult to resist and shortfalls that are easy to fix.
Let's begin. So, what is great about Sprint?:

  • Unbeatable pricing and comprehensive plans
  • Coverage that, in practical terms, is more than enough for the vast majority of people.
  • A very willing customer service people, who really try to go above and beyond the call of duty to address your problems, and who seem to be empowered to solve them.
  • What seems to be a solvent technical infrastructure.

What needs to be fixed?

  • Their array of phones is not ideal. Palm Pre was not the killer phone everyone expected it to be. The cool factor is not completely there yet. But I am encouraged by their relationship with HTC and the series of attractive phones this company is launching.
  • Administrative structure and systems that are not integrated, and likely completely outdated, that smother the good intentions of the Customer Service people, making it more difficult than necessary for them to resolve problems. The different departments in charge of sales and customer service don’t seem to be coordinated, and worst, their systems seem to be archaic, not allowing anyone to get the full picture of what’s going on with an order or an account. Consumers are simply not willing to endure frustration, and hence the bad rap about Sprint.
How do I know? I am a happy Sprint customer. Delighted? Not quite, but happy indeed. I was very amused in one occasion when during a meeting at a mainstream hotel in Hilton Head, SC, none of my iPhone-slinging colleagues had coverage, while I, the mobile-challenged Sprint customer, could make phone calls galore and connect to the internet without a hitch.

So, what’s the issue with Sprint? Let me very briefly summarize my own story to illustrate it:
  • Sprint’s package blew away those of Verizon and AT&T. For less money than what AT&T was charging for the iPhone voice and basic data service (all other services, like text, would mean additional charges), plus two family voice lines, I got three lines with triple the shared minutes and unlimited everything –internet, texting, GPS, TV- from Sprint. That’s a dramatic value advantage for Sprint.
  • So I placed my order over the internet, on the special website Sprint prepared for my company, with all the corresponding discounts. In addition, the website was featuring two additional promotions: an extra discount on the phones to be applied as two invoice credits, and a referral discount. At the moment of placing my order, I requested the porting of my old cell numbers. I am satisfied.
  • One or two days later, I found that my order was cancelled and replaced by another. Phone call to Sprint: what happened? -“Not to worry, everything nominal”. Good.
  • Got the phones. Porting had not taken place. Another phone call: what happened? - ” It usually takes a couple of days”. Frustrated, but, OK, let’s be patient.
  • A couple of days. Phone call: what’s up with porting. - “Don’t know why it didn’t go through. Call the Porting Depmt.” And I called: -“Don’t have the request here, but let’s get it done”. Done in a matter of minutes. Somewhat upset by the slip, but since the resolution was quick and easy, I’m OK.
  • First bill. No promotional discount. Call again: where’s my discount? -“what discount?”. The one in your website for my company.- “We don’t see it”. I am seeing it, in front of me. Just go to your own website.- “We have no access to our website. We need to check promotions one by one in this book” Hey, someone must have placed this promotion in your website! -“Corporate sales” Well, talk to them! “We can’t; you have to call.”. Called Corporate Sales. Same story. So, they take my word and credit the respective amount.
  • Next month. Second bill. No second installment of the famous promotional discount. Repeat process.
  • Referral promotion? Never showed up.
In all this process, Customer Service people were great. But you could hear their own frustration at their inability to help because their systems wouldn’t allow them. Most new customers would have dumped the company after this mess. In other circumstances, I would have too. But I stuck with them because I felt there was a lot to gain. I was right.

While we had a rocky beginning, ever since Sprint and I are getting along just fine. And when I compare my mobile bill with those of my colleagues, I can’t help it but to smile.

I truly believe Sprint has put together a very compelling proposition for their customers. It’s just a matter of time for more and more consumers to take notice. And now that AT&T has nixed their unlimited data plan, Sprint competitive advantage seems to be even more relevant. If only they had the iPhone!

When companies provide a superior product to their competition, growth will follow. Sprint looks like a sound investment right now. But c’mon, Sprint, fix your internal processes and systems already!!!!

I rest my case.