O2 plans for continued growth in 2014

O2 plans for continued growth in 2014

O2 intends to build on a stellar 2013 by launching new digital offerings, investing in its growing network and continuing to provide differentiated services for customers.

The operator posted its best postpay figures for four years as 983,000 people signed up to O2 tariffs across the twelve months, while one million customers have taken 4G packages since its August launch. CEO Ronan Dunne acknowledged the good performance but said he wanted growth to continue through 2014 as the business continues to evolve.

He told Mobile: ‘There are four underpinning pillars we continue to emphasise. The first is growing revenues from delivering new services in the digital world. The second thing is to accelerate that with investment in networks and systems. Thirdly, we want to focus on efficiency so we can prioritise investment in growth.

‘The last thing is strengthening our leadership in the digital ecosystem to demonstrate how telcos can lead in the value chain by putting customers at the heart of everything.’

According to Dunne, customer satisfaction is the foundation for his company’s success. Offering customers a ‘unique and differentiated service’ such as the popular Refresh tariffs and Priority Moments proposition was highlighted as the firm’s USP. Refresh, which allows customers to change their handset at any time, was taken up by one million customers, while Priority handed its seven million users ‘£20m of incremental value’ in 2013.

The CEO added: ‘There’s a real breadth and attractiveness of the O2 proposition from a customer point of view. We have two compelling offerings our competitors don’t have [Refresh and Priority]. The strength of the O2 brand is as significant in 4G as it has been with 2G and 3G.’

That 4G network continues to be improved, and now covers 32% of the population in 16 cities and 160 towns. Plans to provide coverage to 98% of the UK by 2017 are on track, but Dunne is keen to mention that equipment is being upgraded on O2’s 2G and 3G services as well.

Although Dunne couldn’t disclose many details about the new services O2 plans to launch in 2014, he did reveal that O2 customers can expect ‘enabling products to give consumers more confidence to engage’. The operator’s TU Go application, which allows users to make calls via laptops and tablets, has been developed to be compatible with wearable devices, while ‘Latch’ has been created to give users control over data sharing with service providers.

Dunne said: ‘Our main challenge for 2014 is focus. We don’t want to bombard our customers with stuff; we need to take the role of curating on their behalf. We need to make sure less is more.’

Retail plans

Ronan Dunne said that O2 was ‘broadly happy’ with the size of its retail estate, and it would continue to focus on completing the current phase of transferring 80 directly managed stores to franchises. The CEO told Mobile that 67 of the stores had been transferred by the end of 2013 and the process was due to complete in a ‘couple of months’.

He added: ‘In 2014, store experience, store format and the interplay between online and offline is where our focus is.’

The operator pulled out of Phones 4u last year, and Dunne confirmed O2’s focus was on ‘delivering as much of the business direct as possible’.

He said: ‘Our position with Phones 4u is clear: we didn’t fall out with them. There were no policy decisions that we won’t distribute through independent channels. We just want the best mix of quality and value.’

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