Trapping the Tourists

Most modern cities are very interested in trapping their tourists: providing them with a pleasant and easygoing experience that encourages them to visit, spend as much of their cash as they can, and send their friends.

The process in “trapping the tourists” is no different than any other form of marketing. Structure the correct product, provide the right price, package it in the right fashion, and place it where it will be found by your target.

In the last few months, I have stepped through several American, Canadian and European airports. I have noticed a distinct contrast between the North American mobile model as it affects tourists and the European one.

Step into the arrivals area – and sometimes even on the secure transfer side – of nearly any European airport, and you will find kiosks, automated or serviced, selling SIM cards. For some reasonable fee of a few dollars per day, tourists and business visitors can buy mobile access. While Vodafone and Deutsche Telekom do not break out the percentage of revenue derived from these one-time transactions, it must be sufficient to continue to support the kiosk services: supplying cards, paying rental space, maintaining the equipment in the face of breakdown, linking the cards and their (complex) billing systems, etc.

The SIM kiosks are a good example of the 4Ps: it is the right product (prepaid ready-to-run mobile service), at the right price (more per usage than a monthly subscriber, far less than roaming), in the right package (a SIM card, not a whole phone), in exactly the right place (kiosks in arrival areas and transfer zones).

By contrast, I have never seen a mobile card kiosk in a US or Canadian airport. Off the top of my head, I can think of Dulles, Reagan National, La Guardia, JFK, Newark, San Francisco, San Jose, Denver, Montreal, Toronto, and that is just a start.

North American carriers are intensely focused on recurring revenue: monthly postpaid and regularly renewing prepaid subscribers. No doubt, these make up the bulk of their revenue, and recurring revenue is better precisely due to its recurrence and predictability. But focus on your core market should never blind you to potential additional markets, especially ones that can be serviced with your current assets.

About Avi Deitcher

Avi Deitcher is a technology business consultant who lives to dramatically improve fast-moving and fast-growing companies. He writes regularly on this blog, and can be reached via Facebook, Twitter and avi@atomicinc.com.
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