Sprint’s promotions in fiscal 3Q14
In the last part of the series, we talked about Sprint’s (S) high iPhone sales during fiscal 3Q14. We also learned about how the four national wireless carriers resorted to competition during the quarter. In this part of this series, we’ll look at some of Sprint’s key plans. The plans might have helped the company during the quarter.
After the launch of Apple’s (AAPL) iPhone 6 in September 2014, Sprint initiated a series of promotional plans to attract new customers to its network. One of the key plans that the company started during this period was the “Cut Your Bill in Half Event.”
Sprint also launched the “iPhone for Life” plan in September 2014 to target iPhone customers. It also made its existing offerings more attractive with features like doubling the data plans.
Cut Your Bill in Half Event
Sprint introduced the “Cut Your Bill in Half Event” in the first week of December 2014. The promotion specifically targeted AT&T (T) and Verizon’s (VZ) wireless customers. Customers who choose the promotion get the data plan that they had with AT&T or Verizon at half the price.
The promotion also takes care of customers’ existing contracts with these two telecoms. The maximum limit for existing contract coverage is $350. The customers get benefits like unlimited domestic calls and text. They also get unlimited calls and texts for certain international locations.
After the plan’s initial success, Sprint extended the promotion through 2015. According to Marcelo Claure, Sprint’s CEO, the promotion helped Sprint gain customers from AT&T and Verizon. During December 2014, when the promotion was launched, the company’s retail stores witnessed a 10% YoY (year-over-year) growth in customer traffic. Claure spoke about this in the company’s fiscal 3Q14 earnings call on February 5, 2015.
If you want to get diversified exposure to Sprint, you can invest in the iShares U.S. Telecommunications ETF (IYZ). IYZ held ~4.6% in the telecom on March 5, 2015.