Sprint Acquires Virgin - Sprint's prepaid brand options continuedSprint acquires Virgin Mobile USA, which will impact their prepaid wireless strategy. If you haven't already, you can review more details about the Virgin purchase by visiting the Sprint Buys Virgin Mobile page. The strategic options below are the second half of the list; to review the start of the list, check out the previous Sprint Acquires Virgin Mobile page . If you have any others, or if you have any comments on this options discussion, please submit your feedback below (click here to skip down now); myself, and other visitors to the site would love to hear what you think!5. Offer Similar Products But Target Different Niches This approach is very much what Sprint said was its strategy at the time of announcing the purchase of Virgin Mobile. In other words, Sprint acquires Virgin and it's business as usual, with the assumption/statement that the two brands target very different customers, and while there may be some overlap, it's not significant enough to be concerned. I personally don't buy into this, and that operating the brands as they currently exist, and paying special attention to targeting different demographics, will ultimately fail. Customers would really need to clearly understand what each brand stands for, and how that translates into the differences in plans, value, and general service experience; otherwise there would be confusion and even frustration. Even if Sprint attempts to offer different distribution, and advertise each brand in different markets, with the world the way it is, open and accessible, this strategy will ultimately be a challenging approach with a high probability of failure. Note that the difference between this approach and Option 1 is that here Sprint would completely merge all operations, and simply target the distribution and marketing in different niches. To the contrary, Option 1 has both brands existing as they do today, simply under the Sprint owned umbrella. Conclusion - The likely short term approach, but will never be a long term successful strategy. 6. Dissolve both brands into new Sprint Prepaid brand This strategy is actually discussed here, and while I still believe is a very viable approach, the purchase of Virgin Mobile USA really does change the conclusion I made in that discussion. I believe that the Virgin brand is sufficiently valuable that Sprint would be wise to maintain a distinct prepaid brand under a Virgin offering. While I'm certainly not a brand expert, I do believe that while the Boost brand has limited appeal and value (as previously discussed), having the Virgin brand persist would help differentiate the offerings. I still do believe that allowing customers to transition between prepaid and postpaid plans should be simple and easy, leveraging the Virgin name will help to add clarity as to whether a customer is on a contract or no contract plan. In other words, when it was a choice between Boost, Sprint prepaid, or creating a new prepaid brand, I believed that Sprint prepaid would be the best choice. However, with the purchase of Virgin Mobile, my recommended best approach has shifted to taking advantage of Virgin's brand. Your opinion may differ...? Conclusion - While this is still a viable long term approach, Sprint will not likely select this approach. 7. Dissolve Boost into Virgin This strategy would mean that Sprint acquires Virgin and the Boost brand is eliminated in favor of using Virgin as Sprint's prepaid brand. Unlike Option 4, I believe this option is actually possible! Bottom line is that the Virgin brand has a much broader appeal. Boost has been pigeon holed into somewhat of a ghetto brand, as opposed to being a generic youth and value brand as is the case with Virgin Mobile. I believe that people are looking for good quality products and no contract plans that offer great value, and that they don't really care a lot about the brand itself. In fact, some people may be turned off by Boost's legacy brand. We've actually seen Boost try to expand its appeal with its "Unwronged" marketing campaign, which is humorous and entertaining. Ultimately, I believe that customers just need to know a plan/offer is available, and they will then choose the one with the best value, and to some extend offers a phone they really want. In other words, they don't really place much value in the brand, although a poor brand would have a negative effect. In the case of both Virgin and Boost, both brands are associated with Sprint, and that appeal (or lack thereof) will have a greater impact than the individual Virgin or Boost brands. Conclusion - This is the best, and arguably very likely candidate for Sprint's long term prepaid strategy! Sprint Acquires Virgin - Overall Conclusion! It will take the better part of a year (or more!) following the official close of the Virgin acquisition (regulatory approval is still needed) before Sprint will even have an idea of what the new organizational structure will look like in detail. Prior to the close of the deal, they are legally obligated to continue operating as business as usual, which means that they can't make any obvious strategic moves, even if they might want to. Then they'll need some time to learn about how each organization (Virgin vs. Boost/Sprint) operates, and where "synergies" can be seen. Some will be immediately obvious, while others will take literally years to uncover. Also note that Sprint has a history of screwing up mergers - i.e. The Sprint Nextel merger was deemed the worst merger in the history of the corporate America, essentially destroying the entire value of the deal (~$30 billion), along with the Nextel brand. In other words, Sprint is going to take this slowly to help minimize making big mistakes. The whole point here is that Sprint acquires Virgin, but we'll need at least several years before anyone will be able to make any meaningful conclusions as to which strategy is truly at play. We'll see some things implemented over time, but what's the ultimate end game? Which of these options (or another one) was actually implemented? We'll need a number of years before that conclusion can be made! In the meantime, I will continue to update this discussion on Sprint Acquires Virgin as things evolve, and welcome any feeback, discussion, or insight that you may have, so please feel free to share your thoughts. UPDATE - Sprint Announces Prepaid Wireless Multi-Brand Strategy!
Sprint Buys Virgin - What do you think?Do you have thoughts as to what Sprint will do with the Virgin Mobile and Boost Mobile brands? Please share! Read Other People's OpinionsClick on the links below to see what others think about Sprint's acquisition of Virgin Mobile. Sprint Prepaid Wireless Strategy Some pretty interesting stuff going on with Sprint over the past couple of years related to prepaid wireless! When they first launched Boost Mobile, the ...
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