Sprint Nextel, Inc Strategic Marketing Plan

sprint-nextel-marketing-strategies

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by Jerry

26 October 2018

Sprint Nextel, Inc appeared in the result of a merger between Sprint Corporation and Nextel Corporation in the United States in 2005. The company operates as one of the largest holding companies, offering a wide array of both wireline and wireless communications products and services designed to satisfy the need and demands of individual consumers, government subscribers, businesses as well as resellers. Sprint Nextel, Inc is dedicated to provide satisfactory communications services aimed at solving customers’ communication problems in all fifty states in the U.S. However, the history of Sprint Nextel, Inc dates back in 1898 in Kansas when Carlos Florendo, Jr. and Cleyson Leroy Brown came together as partners and formed the Brown Telephone Company, which operated as a landline firm to topple the monopoly of Bell System. By 1972, the company changes its name to United Telecommunications and by then, it was able to provide telephone services and other communication services via railroad system that covered a wide range of places within the United States (Chen). In the late 1970s, when people were migrating from railroad system to radio system, the company was rendered useless until in 1983 when it merged with General Telephone (GTE) to form GTE Sprint. In the 1990s, GTE Sprint was owned by United Telecom under the name Sprint International, providing communication services both locally and internationally. The company persisted in its services through early 2000, which brought it together with Nextel in 2005 to become Sprint Nextel Corporation. Currently, the company is committed to standing out as a leader in corporate governance, compliance and ethics and boasts of the many awards and recognitions it has. Apparently, it survival in the market since its commencement is utterly accrued to the company’s strategic marketing plan, which has given it the spirit to thrive and compete among other companies in the market.

Environmental Analysis

This majorly focuses on the process that Sprint Nextel Corporation uses in assessing and interpreting vital information gathered through environmental scanning. Due to augmented globalization effects with related sophistications as well as rapid technological changes, increased competition and other discrete relevant changes are concerned, Sprint Nextel Corporation just like other global competitive companies values the quality and reliability of the information gathered. This is because, this information is vitally important in making key decisions, as well as assisting the management in planning for the organization’s future course of action. The general course of environmental analysis encompasses both looking for and at the information gathered from the market aimed at critical analysis and evaluation of information for the effective decision-making process. The company engages in a series of external studies in a bid to identify threats and opportunities, formulate short-term and long-term strategies, identify customer needs, and overcome uncertainty, as well as gain competitive advantages over rival firms in the market. Besides, this process allows Sprint Nextel Corporation to adapt and deal diligently with the complexities associated with the changing society that we live in. Usually, Sprint Nextel Corporation is in constant monitoring of the environment both internal and external by making multiple contacts daily with the aim of understanding the market needs and requirements (Mighty Students). As such, the company gathers all relevant information, analyzes it, and applies it in making appropriate decisions regarding the company’s operations in its quest to remain a globally competitive firm in the communication industry. In addition, the company engages in constant assessment of information in search of relevant data for decision making. Sprint Nextel Corporation understands that information has no value until the managers use it to make better decisions. The information gathered from all these processes must be distributed to the marketing managers at the right time. With the recent developments in information technology, most companies, including Sprint Nextel Corporation, are decentralizing their marketing operations and, most of the times, the managers have direct access to information network through personal computers and outside sources.

Marketing Strategy

Sprint Nextel Corporation’s marketing strategy is utterly aimed at optimizing market opportunities through its target markets with the goal of maximizing sales and consequently maximizing profits in the long-run. The company understands that they must know the circumstances that trigger a need, which enables it to develop the various marketing strategy in a bid to trigger a purchase and thus increasing sales. As such, the company utilizes a lot of sales channels that attract new customers, including the use of web sales and telesales, which are certainly subscriber-convenient channels. The company also owns and operates retail outlets, which focus on sales to the consumers, as well as intermediary retailers besides the use of indirect sales agents who chiefly entail the local and state non-allied brokers and independent freelancers that not only market but also sell services to the consumers and businesses. The company also uses direct sales representatives, whose efforts are focused on marketing and selling wireless services primarily to government agencies, mid-sized and large-sized businesses (Market Watch). These marketing strategies are aimed at capturing new customers as well as retaining the existing ones so that the company is able to make greater sales. In addition, the company markets its services in print media and television, as well as offering customers an exposure to the company’s brands, wireless services, etc. via a wide array of sponsorships such as the National Basketball Association (NBA) among others. Precisely, the company’s marketing strategy is under the company’s strategic planning, which is merely a prerogative of the top-level managers, that is, it is carried out at the top management level.

Product or Service Strategy

The company offers unique services and products providing customers with a choice to meet their growing demand and needs. Services are provided using a wide range of devices and applications, including multi-functional device portfolio and mobile broadband portfolio, as well as accessories such as hands-free devices, carrying cases, battery chargers, batteries, among other items to customers, which are sold to agents and other intermediary distributors for resale. Usually, these products are sold at lower prices than the costs are, which is a product strategy aimed at attracting new customers, as well as retaining the existing subscribers as they keep enjoying the products. Additionally, the company offers diversified services to subscribers through a wide range of data and voice services such as internet access, email services, and messaging as well as wireless photo and video offerings. It also provides subscribers with mobile applications, such as listen to satellite radio, view live television, download and listen to music, and play games “with full-color graphics and polyphonic and real-music sounds from a wireless handset” (Guru). Besides, the company provides convenient “wireless voice communications” with the ability to make both local and international calls at lower rates (Guru). Other important voice services include caller identification, voicemail, three-way calling, call waiting, directory assistance, and call forwarding services irrespective of the recipient’s location. These account for the company’s service strategy to attract as many subscribers as possible while keeping the existing subscribers.

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Pricing Strategy

Pricing strategy is very important for the success of the organization because it is the only P that generates revenue. All others are costs to the firms. Effective pricing, therefore, requires a thorough evaluation of the costs of the relevant products or services. The company’s pricing strategy is divided into two main categories of postpaid and prepaid portfolios. Under postpaid portfolio, the company offers price plans that are customized to meet the needs of businesses. Early this year, the company launched a masterpiece of all mobile services allowing subscribers to talk unlimitedly, send unlimited texts, and unlimited data on their mobile phones. On the other hand, the prepaid portfolio consists of multiple brands designed to meet specific subscriber segments in the U.S. These include Boost Mobile, which is tailored to meet the needs of subscribers who are both voice and messaging-centric, where bills are abridged after making six on-payments (Verbrugge-Rhind). Another brand is the Virgin Mobile, which serves subscribers who are device and data-oriented by giving them the freedom to exercise control, flexibility, and connectivity via a variety of communication channels. In particular, the company’s pricing decision is based on what competitors’ charges are, which can be termed as the going-rate pricing. This is due to the fact that the company does not believe in cost-plus pricing due to its ability to charge lower prices to its products and services compared to the costs incurred.

Advertising and Promotion Strategy

Promotion in general and advertising, in particular, are the activities most commonly associated with the term “marketing,” although, marketing orientation goes far beyond these functions. The term promotion as a component of any marketing mix refers to the techniques used by an organization in order to communicate with its customers, both actual and potential. It involves a specific mix of advertising, sales promotion, personal selling, public relations, publicity and direct marketing. Sprint Nextel Corporation utilizes a couple of these mixes in a bid to reach as many people as possible. The company engages in rigorous advertising, which is a form of non-personal “presentation and promotion of ideas, goods or services by an identified sponsor” through the media (VerBrugge-Rhind). Advertising is widely used in order to reach masses at the lowest cost possible, and it allows the marketer to repeat the message offering individuals a reason to purchase both the products and services of the company. Advertising majorly includes print and electronic media. Additionally, the company uses a lot of sales promotions, which consist of a diverse collection of incentive-tools; mostly short-term designed to stimulate quick and greater sales of the company’s products and services. These include numerous unlimited free calls, data bundles and messaging. The incentives attract consumer attention, offer strong incentives to purchase and can be used to dramatize product offers and to boost sagging sales. All these strategies are focused on bringing in new subscribers and retaining the existing ones by making them enjoy a wide variety of incentives as well as through numerous advertisements. Sales promotions encourage and reward a quick response – when advertising says “buy our product,” sales promotion says “buy it now.”

Distribution and Logistics

Sprint Nextel Corporation’s logistics operates under the principle of having the right services and/or products in the precise quantity and quality at the appropriate time and place at the right affordable prices to the target customers. The company uses different distribution channels such as retail outlets to make their products and services readily available in the market to meet customer needs and demands (Chen). As such, the company endeavors to make a good public image by liaising with key strategic organizations with the aim of capturing a wide array of subscribers while striving to retain the existing ones. Sprint has entered into various contractual obligations with suppliers and distributors, making it easier for the company to retain a wide range of potential customers in the market. These distributors and /or third-party service providers help to market the company in various parts of the United States, which enables the company to penetrate a significant portion of the market.

Critique of Ad/Website/ Social Media for Product and Service

Generally, the company observes a high ethical conduct in various communication strategies employed in a bid to reach various types of customers and subscribers in the marketing process. The company has a team of specialists with the relevant expertise who review all communications and monitor information flow, including advertisements, the website, and social media (Mighty Students). Accordingly, the company employs market research and analysis; this helps it to develop appropriate communication strategies while avoiding making false communications and advertisements that could spark ethical concerns.

Analysis of Major Competitors

Sprint Nextel Corporation faces a lot of competition from a number of wireless carriers in the market and this gives the company a reason to conduct an analysis of its primary competitors in a bid to realize the various strengths, weaknesses, opportunities, and threats and implement strategies for its survival. The major competitors in the market include the various companies such as AT&T, T-Mobile, and Verizon who offer voice, high-speed data, and entertainment as well as both prepaid and postpaid services that present a major challenge to the company (Chen). The company, however, has noted various weaknesses among its competitors, which include lack of the desire to step-up their customers’ experience; this gives the company an opportunity to strengthen its brand through offering a broad selection of services and iconic devices in the market. A proper knowledge of these potential competitors helps the company to design various products and services that are not offered by its competitors and thus be able to compete favorably in the market.

Company S.W.O.T.

As much as the company strives to compete with its rivals in the market by analyzing their  strengths, weaknesses, opportunities, and threats, the company conducts an analysis of its own strengths, weaknesses, opportunities, and threats in a bid to gauge its potential to be able to implement strategies of ensuring it survives in the market. Generally, the company’s strengths and opportunities can be attributed to its robust market position, strong brands, cost-cutting initiatives, and most importantly, the use of WiMAX mobile broadband network (Kurpe). On the other hand, the company’s weakness lies in the fact that the company exercises a high dependency on Motorola. Additionally, there are significant threats the company is facing, such as increasing number of MVNOs, saturation in the market, and industry consolidation that gives the company a reason to worry about their future operations and position.

Future Trends that may Affect Products or Services

With the increasing rate of business consolidation and conglomeration in the communication industry, there are significant risks to the company’s future position in providing competitive products and services to meet the demands and needs of subscribers. These include increased expenses, diversion of management attention, and possible input weaknesses, as well as high competition and increased market sophistication (Market Watch ). Additionally, there are natural disasters and terrorist attacks that pose a greater threat to the future of the company.

Recommendations for the Future

Considering the current trends in the market, it is ideal and recommendable for the company to engage in multiple market research and studies and adopt a culture of absorbing the best team in executing most of its operations. The company should strive to maximize customer experience and always endeavor to strengthen its brand in all facets (Kurpe). Additionally, the company should strive to improve sustainably its wireless spectrum assets without backing down and grasp the new and emerging technologies in a cost-effective approach. Consequently, the company will be in a better position to face future risks and threats in the market with a well-established base that ensures the appropriate support and favorable conditions for competition in the market.

Conclusion

The combination of increased competition and greater uncertainty about the patterns of change in the business environment has encouraged an increasingly planned and strategic approach to marketing in many organizations. The development of an effective strategy requires a clear statement of corporate mission and corporate objectives. Therefore, the important feature of any strategy is that it should be consistent with the distinctive competence of the organization itself and must match the environment either internally or externally as explicated in this paper on Sprint Nextel Corporation.