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Allphones pushes on after 'tough' Optus cutoff

Allphones CEO Shaun Colligan said Optus' decision to cut the mobile retail reseller out was "tough" but the company is pushing for a comeback.
Written by Josh Taylor, Contributor

Mobile retail company Allphones had to take a "pretty hard look" at itself when it was dumped by Optus, CEO Shaun Colligan told ZDNet, but the company is now expanding with its partner Vodafone, and is moving into the Philippines.

As part of an overhaul of its retail strategy to improve its relationship with customers, Optus ended its long-running retail distribution agreement with Allphones and its 140 stores across the country in June this year.

That left Allphones with just one agreement in place with a major mobile provider — Vodafone. The company is still able to sell services on the other networks through mobile virtual network operators (MVNOs), such as Boost for Telstra and Dodo for Optus. But the end of the Optus relationship appears to have resulted in some store closures, with Allphones down to around 110 stores, according to Colligan.

He said that Allphones reviewed its business in the wake of the Optus dumping, and decided to push on as one of the last independent retailers standing.

"Certainly, when you lose part of your business, it certainly makes you have to look pretty hard at what you do. The reality is we're the largest independent retailer in the country, and we're pretty much one of the last men standing," he said.

"It was tough, but the good thing about where we're at now: We have a core footprint, we know where we're at, we know what we're doing with Vodafone, we've got some very strong propositions under other brands on the other networks, and we're still enjoying a good business relationship with our customers."

It comes at a time when all three of the major telcos — Optus, Telstra, and Vodafone — are looking to provide their own Apple-like retail experiences, with stores where they're the only option on hand. For a retailer like Allphones, Colligan said that the focus has to be on devices and the ability of the staff to offer impartial advice on the provider of choice.

"A lot of our customers come in looking to self-upgrade their device, so we've got a very broad range of devices customers can choose from across many brands and accessories. I think we punch above our weight in terms of the deal we can put on the table. We stand for impartial advice, expertise, and value," he said.

"We're very loyal to Vodafone, but if a customer wants to be connected to Optus or Telstra, we will absolutely provide a service through one of those MVNO brands we have on their networks."

To improve the customer sign-up process, Allphones has just implemented an iPad-based document scanning system for checking that new customers meet the 100-point ID check, and for the creation of the new contract. The system was implemented with software development company Vodlo, and removes paper from all of the Allphones stores and replaces it with at least two iPads in each store. The entire rollout across all 110 stores in Australia took around a month.

The iPad is used to enter in new contracts.
Image: Allphones

Once a copy of the ID and other customer documentation has been recorded by the software and a contract has been created, a copy is emailed to the customer and the telco, and then saved in the company's 2,048-bit encrypted document management system hosted by Amazon Web Services.

The result is a saving year on year of 66 percent in paper costs, with 2 million fewer pieces of paper required every year. The cost of the deployment was not disclosed, but Colligan said that it has already paid itself off, saving the company hundreds of thousands of dollars so far not only through paper savings, but also through better credit checks of the customers.

"That saves us money, it saves the carrier money. It means we're verifying the customer for credit checking in real time," he said.

The company is now looking to implement the same systems across its new expansion into the Philippines, where Allphones now has 40 outlets, but is aiming to get to 110 by 2014.

"We're contracted to do up to 250 Allphones stores in the Philippines for [a telco]," he said. "And the crux of that was this digital solution. You're taking a quantum leap for those guys where retail has gone from being a very transactional prepaid environment and we're helping to move them to a post-paid contractual environment."

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