SaskTel Mobility maintains its top spot while Fido is rated second overall
Gillian Shaw
Sun
The prospect of increased competition has driven Canada’s wireless service providers to substantially step up their customer satisfaction rankings, according to a J.D. Power and Associates study released Wednesday.
Customer satisfaction was up across all carriers, with SaskTel Mobility maintaining its top ranking among contract service providers in the second year of the study. Fido rated second overall, followed by Telus Mobility, Aliant and MTS Mobility.
Virgin Mobile earned the strongest loyalty among customers in the prepaid arena for the second consecutive year, followed by Aliant and Telus Mobility.
“The overall industry average has increased quite a bit so it is quite encouraging,” said Charles Schade, senior director of research at J.D. Power and Associates. “The industry is starting to step up to the plate with respect to satisfying the needs of their customers.”
Fido moved up from third place to second in contract service, and Telus bumped up from fourth to third place. Despite an increase in satisfaction levels, MTS failed to keep up with the industry average and dropped from second place to fifth.
Rogers wireless trailed at the bottom of the customer satisfaction rankings for contract service, behind second-to-last place finisher Bell Mobility. In prepaid service, Bell came in last, behind Rogers.
Prepaid service, which lags behind contract service in market penetration, is costing its users much less, with contract customers paying on average $74 a month compared to $29 for prepaid customers.
Schade said number portability and the prospect of increased competition in the industry are driving improvements in customer service. Number portability, expected next spring, means customers will be able to switch carriers without changing phone numbers.
Andrew Black, president and chief executive of Virgin Mobile Canada, suggested his company’s customer service has helped improve service among Canadian carriers.
“I think competition is a good thing for the industry and it will make us all better,” he said of his company which doesn’t lock customers into contracts.
“It comes down to the fact that our culture is so consumer centric,” he said. “I spend over an hour a week on the phone with our customers.
“Our call centre is in the building, 200 feet from my desk and everybody knows if a customer wants to speak to me, they can come and get me.”
Shawn Hall, spokesman for Telus Mobility, said his company’s churn rate, which is the lowest in the industry, is an indication of good customer satisfaction. The churn rate measures the number of customers leaving a carrier.
Telus’ churn rate for the third quarter of this year was 1.36 per cent compared to an industry average of 1.55 per cent.
“This is just one report, you have to look at a lot of different factors when you are considering customer satisfaction,” said Hall.
The survey which was carried out in October was based on online responses from close to 6,000 mobile phone users, starting as young as 13.
According to the survey, contract phone subscribers aren’t using all their minutes. The average number of minutes contracted for a weekday service plan is 187, but customers reported they use only 51 per cent of that. Contract customers use an average of 16 long-distance minutes, accounting for 29 per cent of their contracted time.
The survey also ranked mobile phones with LG taking the highest ranking among brands, followed by Sanyo, Samsung and Sony Ericsson.
CHURN RATES
Churning could describe the feeling mobile phone execs get in the pit of their stomach when they see another provider entering the market, but in industry parlance it refers to customers who leave. Thus a churn rate of one per cent would mean that during the period measured, one of every 100 customers abandoned the carrier.
TELUS MOBILITY
Q3 2006: Blended churn rate for prepaid and post-paid service was 1.36 per cent, compared to 1.33 per cent in the third quarter of last year.
Year-to-date: Telus had a 1.33-per-cent churn rate compared to 1.38 for the same period in 2005.
BELL MOBILITY
Q3 2006: Blended churn rate of 1.5 per cent, the same as the third quarter of last year.
Year-to-date: Bell had a 1.6-per-cent churn rate, unchanged from the same period last year.
(Canadian industry average for Q3 2006: 1.55%*)
Sources: Telus Mobility, Bell Mobility, Merrill Lynch*
© The Vancouver Sun 2006