6/18/2009 12:25:00 PM
New targets at Vodafone brought in as credit crunch tactic
Vodafone has overhauled its retail store targets criteria, putting the onus on 24 month contracts to increase revenue.
Retail staff will now receive targets based entirely on store profit, and commission will be paid as a proportion of this.
The new system replaces the previous method of store targets based on sales volumes, and was implemented on 1 June.
Staff were informed via email that the system had been brought in earlier
than planned because of the credit crunch.
It has emerged that the new profits based targets had been phased in gradually over recent months. Initially, profits accounted for 25% of overall targets, rising to 50%, 75% and on 1 June, 100%.
Staff commission can potentially account for around 25% of total pay. For every £100 of gross profit, staff will receive a £1 commission payment.
Store managers will have a percentage of the gross profit added to their pay.
Staff have also reported a stronger push towards two year contracts, with a new tariff that reduces the monthly price of a contract by £5 if the customer agrees to increase the contract length to 24 months.
Vodafone will save money by diluting the cost of the handset subsidy in a longer contract. Strategy Analytics’ head of wireless practice, Phil Kendall, said: ‘Every contract starts with a heavy subsidy and operators are looking to dissolve that with a longer contract.’
Customers will pay £5 less per month than customers on an 18 month contract, but they will have to endure the phone for longer as upgrades are not available until two months before the end of the term.
Meanwhile, Vodafone is clamping down on staff, with a reported increase in mystery shops and two new categories added for prepay and business, where staff can earn a bonus if they do well.
Terry O’Brien, Vodafone’s retail director, commented: ‘We have a new scheme in store that helps give an even better experience to our customers.’