1/22/2009 8:02:00 PM
Era of the bargain hunter
Aside from politicians who pay good money to be gagged and beaten up in dungeons, there are plenty of people who take enjoyment from milder forms of pain. And pain, it certainly is. Businesses of all sizes are collapsing around us, and everyone knows at least one person who is going through the awful process of being made redundant.
The fact that this industry has never seen a recession has brought out panic in some quarters, while others have declared a masochistic streak in enjoying hatching their survival plans. In our industry, we can see two things going on. The first is companies employing new strategies and priorities to cope under the current conditions. The second is how (and how quickly) businesses are adapting their offers to tap into the needs of today’s consumer with new propositions. 3’s £9-per-month tariff captures the mood perfectly, and is a sign of things to come.
Success at the top-end of the handset market is limited to one or two show-stealers with many fatalities along the way, but the mid-market is where the damage has been felt most severely, with growing polarisation. Cheap contract deals have pushed up interest in £100-£150 priced phones. Demand from operators in this segment has even allowed some manufacturers to lift their prices here to eke out some well-needed margin.
An interesting analogy can be seen in the automobile market. Honda has suspended production for new cars as demand has virtually collapsed. Meanwhile, thousands of pounds have been slashed off mid-range cars priced below £7,000 with some superb bargains. Finally, at auctions for old bangers, prices are actually rising, with more people trading down and looking for a cheap deal. And just as it is in auction, it’s all about preparation, having a plan and moving decisively.