Animal Magnetism

Last month Orange unveiled what it described as “a new simplified way of offering services to its customers” with tariffs that are “built specifically around the behavioural characteristics of the modern mobile user”. It’s also gone further – instead of semi-explicit product names like ‘YourPlan 200’, it hasopted for the kind of nomenclature more usually associated with the car industry.
The four packages are being marketed under different animal names, with different mixes of inclusive texts, minutes and other extras.

Orange says it has research which shows that the animal names acted as useful signposts for customers, with “the different animal names resonating among the specific target audiences”. The four groups are also claimed to have distinct differences in phone usage, attitudes and demographics – and to account for 77% of value in the marketplace.

All the new tariffs will offer 50% more minutes than they previously did on 18-month contracts, and 25% more on 12-month deals. (They are available to contract customers this month, with prepay tariffs to follow later this year)

Texts will be bundled into the new tariffs, as is the way with other networks. Previously of course Orange required customers to buy an additional text bundle.

There’s also an incentive for customers to sign up for 18-month contracts, varying by animal – a free download starter pack for the low-end Dolphins, free photography for three months for the chattering Canaries, free Traffic TV for three months for the businesslike Raccoons, free email (up to 4MB worth) for four months for the Panthers. The latter also get a better deal on 3G minutes if they go for 18 months – 50% extra rather than 25%.

Customers choosing an 18 month contract also benefit from the newly introduced Magic Numbers deal. That allows customers to nominate their most frequently called Orange number; they can then make calls of up to an hour to that number and won’t pay for more than a minute. Every six months Pay Monthly customers can choose an additional Magic Number.

Neil Macgeorge, Director of Pay Monthly for Orange, said the animal strategy was a deliberate attempt to make life easier for the customer – and by extension an easier sell for the dealer. “We’re shifting the way we sell services to customers and changing the headlines on the high street from complicated tariff tables to simple messages …”

Leaving aside the names, we like the idea of a clear and understandable approach to tariffs. For a while now there’s been a tendency for the networks to cut the cost of calling only through a raft of discount offers; the tide seems to be turning, though, with the up-front costs plainly including extra minutes.
But Orange is being a tad disingenuous in describing the four-layer tariff as a simplification that will benefit customers. It’s clear that the new tariffs will give new and migrating customers fewer bundled minutes, at least at the bottom end – £19 a month will buy 50 minutes rather than 60, £25 will buy 100 minutes not 120. The mid-range bundles seem comparable with the previous tariffs; high-end Panther-level customers will benefit substantially.
And Orange appears to be ready to load on at least some extras – £1.50 a month for itemised billing, £3.50 per month for customers who don’t pay by direct debit, a fee of 1p apiece for delivery reports on texts.

The new pricing scheme is backed by a £10 million advertising campaign which runs to the end of the year. That should be good for dealers; and if they suspect that a potential customer might resent being labelled say a raccoon, there is always the option to bypass the animal names and sell whatever tariff seems right for the customer.

Dealers are generally being pretty cynical about the animal branding while applauding the simplification of the offer, even though Orange is complicating it with 18-month incentives; picking through the different animal packages on offer already looks a little like the old way of doing things but with crisper graphics. It will be interesting to see how things pan out nine months or so down the road.

Orange’s animals

Dolphin
The biggest part of the market” according to Orange’s analysis – “young at heart, love having fun, spontaneous communicators and social organisers”. This is a cost-conscious group but it does buy additional services such as ringtones and games. What do they get? Lots of free texts, an allowance of cross network anytime minutes, low/mid tier “fun-orientated” phones.

Raccoon
People who see their phone as a tool not a toy. They mainly use voice – very little texting, a high proportion of calls to landlines, and tending to be “slightly older males”, probably tradesmen or professionals.
What do they get? No texts; instead cross-network minutes plus up to two hours’ additional calls to fixed-line numbers. “Simple, functional phones” will be featured with this package.

Canary
People who love to chat – “sociable communicators with a close circle of family and friends”, fairly high users of both voice and texts, probably young, female and working
What do they get? Inclusive text and talk plus extra off-peak calls and mid-tier fashion phones.

Panther
Those who expect extras as standard – high value customers, typically ABC1, value a superior customer experience, rely on the phone for running their business and personal lives – tend to be young professional males
What do they get? “Premier customer services”, lots of cross network minutes, 25% extra 3G minutes, free answerphone, top-end handsets.