I returned INS to their position as the No. 1 business internet provider in the UK. Using customer behaviour and sales data I made small changes to INS’s service proposition, altering the way services were delivered and priced.
Internet Network Services (INS) were a UK-based ISP acquired by Cable & Wireless. INS provided the highest quality business internet in the UK at the time, but were losing market share to competitors such as BT. My challenge was to return INS to being the UK’s leading business internet provider in the shortest time and at the least cost.
I was global head of strategy for internet products and services at Cable & Wireless when INS was acquired. INS had an amazing technical team and were a potential key building block for Cable & Wireless to lead the market in pan-European services, but first we had to secure the UK market as quickly as possible, with the least cost to Cable & Wireless.
As INS needed a rapid and cheap solution creating a new technical solution was out of the question. So instead I asked about INS’s customers and what kind of user behaviour they displayed pre- and post- sale.
It transpired that customers were impressed with INS’s services and often asked about upgrades. However, the cost and hassle of an upgrade put customers off, as upgrading to the next class of service involved the provision of a new internet connection – changing the customer’s connection from cheap copper to more expensive fibre.
Further investigation showed while fibre was much more expensive than copper to provide, the true cost of the upgrade process was not the fibre itself but the process of installing it. Looking at the customer data it also turned out that despite the cost and hassle of an upgrade, quite a lot of customers upgraded within the first two years of service. A key finding for us was that they liked the internet and they wanted more of it.
So I ran a thought experiment and a small mathematical model. My question was: how many customers would have to upgrade to make it worth installing free fibre for all new customers?
The numbers showed that sales of the higher speed product would have to increase by about 15% to break even, i.e., to pay for all the fibre that was being given to customers that only needed the cheaper copper. A 15% increase in sales was a tall order for a company losing market share but the market was expanding, and I persuaded the board to back my analysis and install fibre for free for all new customers.
I worked with the product marketing team and we created the brand Simplicity that had the unique selling proposition that upgrades could be offered instantly almost for free.
As soon as Simplicity was launched, the sales of INS’s main business internet product line increased by over 400%, far exceeding my most optimistic forecasts. Competitors soon followed but INS’s order book was full, and it had breathing room to develop new technology-based solutions that kept it one step ahead of the market.