RadioShack No Contract Wireless
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ON SEPTEMBER 7TH, 2014!
The RadioShack No Contract Wireless brand is an interesting topic in
the world of prepaid wireless! This new program launched on
September 5th 2012. I don't typically write dedicated pages
for specific brands, whether or not they are large or small.
To get a dedicated page, the company or brand must be particularly
unique in the industry, or offer some interesting discussion.
In the case of RadioShack's new prepaid wireless brand, it's running
its program as an MVNO of Cricket. However, unlike a classic
MVNO, it's actually using the "powered by Cricket" branding.
This branding is somewhat unique, or shall I say odd. If it
feels that the RadioShack brand is powerful enough in consumers' minds
that it can be successful selling no contract wireless, why not simply
use it's own brand? It see that the answer is
twofold. First, RadioShack wanted to leverage the brand value
that Cricket has as one of the founders of unlimited prepaid wireless
and prepaid broadband. Second, in order for Cricket to gain
value from the relationship, partnering with RadioShack as a major
national retailer certainly adds some level of credibility to Cricket
who has been struggling to crack the national retail market.
In order to do that, it needed a clear associated with this new program.
Why Choose Cricket?
It's interesting that in order to achieve nationwide cellular coverage,
Cricket is actually itself an MVNO of Sprint. So to host
RadioShack's new brand under Cricket is someone odd to say the
least. Why wouldn't RadioShack partner with a truly
nationwide carrier? As I contemplated this peculiar
situation, I did some digging with my contacts in the prepaid
space. Interestingly, rumor has it that RadioShack went with
Cricket because no one else wanted to do it!
The reality is that launching, managing, and operating an MVNO is
extremely expensive, complex, and always far more challenging than
people ever believe it will be. That said, people with
experience will know this and immediately determine that working with
RadioShack in this manner would be distracting to their core
business. As noted, desperate to penetrate the retail space,
Cricket had a unique, despite it being a misguided, motivation to
improve its position there.
I think the obvious question is why not simply work directly with
Sprint, which has an entire infrastructure to support the launch and
operations of MVNOs on its network, including dozens of successful MVNO
launches? Note that I'm using "successful" very loosely
here. Regardless, Sprint has the know-how to do these kinds
of programs, and are far more qualified than Cricket to support
it. Perhaps it was a cost issue, or some other logistic or
political circumstances. When I gain more insight into the
specifics there I will certainly update this page!
Does The Industry Need A
New Prepaid Brand?
Oh my goodness, another prepaid wireless brand; yuck!
RadioShack is already very successful at selling wireless products,
both no contract and postpaid contract plans. In addition,
there are plenty of prepaid brands that they don't currently sell that
they could add to their arsenal. Will they really sell more
product using their own brand? Whether or not that's the
case, the market certainly doesn't need it!
Their offers at launch for their RadioShack No Contract Wireless
program have slightly better pricing than the corresponding Cricket
plans, however, in terms of real value, it's simply not
there. What does the RadioShack brand bring to customers that
transcends pricing? What's their unique value proposition or
core competency that customers can benefit from? The fact is
that these elements are lacking. Overall, this new brand
feels like an exercise in ego implementation.
But Choice Is Good, No?
Customers typically benefit from having more options.
However, too many options that don't have unique positioning can be
overwhelming. When that becomes the case, customers will
usually stay with what they know or are familiar with.
RadioShack's prepaid wireless brand simply comes off as a Cricket
product being pushed by Radio Shack; what's the point?
Maybe I'll be wrong, and this brand will take off and be a huge
success. If that happens, that would be fantastic, and would
present an opportunity for massive. I'll continue to monitor
their progress to see how they do. In the meantime, however,
my skepticism hat is still on, and I'd be surprised if the brand lasts
three years. The first year is all about excitement,
experimentation, and belief in success. The second year tends
to show the reality of the business model with optimism starting to
break down. It takes the third year to concede failure and to
gain approval to wind down the business. Again, I hope I'm
wrong! If you see value in the RadioShack No Contract
Wireless program that I'm missing, definitely please don't hesitate to
share your thoughts!
As a result of lackluster sales, RadioShack discontinued the entire
program just two years following its launch. While I don't
to see companies fail, this failure was foreshadowed from day one due
to a fundamental lack of any real value proposition. In 2015,
RadioShack began closing down retail stores, and ultimately went
brankrupt due to overall financial
turmoil. The fact is that they simply couldn't compete with
online retailers, and never evolved to carve out any meaningful
positioning in the world of brick and mortar retail.