Phones4U

Phones4U

Type	Public
Industry	Telecommunications
Founded	1996
Headquarters	Newcastle under Lyme, England, UK
Key people	Tim Whiting, Group CEO. Phil Dobson, Phones 4u CEO
Products	Home and Mobile telephone equipment and services
Website	phones4u.co.uk

Phones 4u is a large independent mobile phone retailer in the UK. It is part of the 4u Group based in Newcastle-under-Lyme, Staffordshire. Since opening in 1996, it has expanded to over 550 stores throughout the United Kingdom.

Company Background

In 1987, John Caudwell and his brother Brian founded Midlands Mobile Phones, to wholesale distribute mobile phones. The company became the Caudwell Group, for which the high street retail arm was named Phones 4u.

On 26 September 2006, The Caudwell Group was sold for a sum of £1.46 billion to private equity firms Providence Equity Partners and Doughty Hanson.^[1] In February 2008, the group bought online retailer Dialaphone in a deal brokered by Tim Whiting worth an estimated £9 million.^[2] In July 2010, Phones 4u partnered with electrical chain Dixons to place 49 "concessions" inside a small number of Currys and PC World stores.

A branch of Phones 4u on Briggate in Leeds.

The group was acquired by the private equity group BC Partners in March 2011. The deal, estimated to be worth in the region of £700 million, was agreed several months after talks with a US private equity owner were aborted.^[3]

The 4u Group consists of the following brands:

• Phones 4u - high-street and online retailer
• Dialaphone - online retailer
• Policy Administration Services - mobile phone insurance provider
• Lifestyle Services Group - mobile phone insurance

Products

In-store and online, Phones 4u sell feature phones and smartphones from all major manufacturers on both contract agreements and pay as you go tariffs. These are available on all major UK network providers. Gifts ranging from digital cameras to televisions are offered with certain tariffs and devices.

Aside from handsets, Phones 4u stock mobile phone accessories and tablet computer devices.

Insurance is available on many of its products from the financial arm of the 4u Group, Policy Administration Services.

Sales and Service

Turnover for the mobile phone retailer grew 22% in 2010, rising from £746m to £911m.^[4] The group employs over 8,000 people worldwide and sells 26 phones every minute.^[5]

In November 2008, Ofcom found Phones 4u guilty of misleading customers over network coverage, failing to swiftly provide refunds for faulty handsets and having unfair terms on chequeback schemes. Phones 4u have given Ofcom a series of undertakings to ensure that similar issues do not rise again.^[6] The company said 80% of complaints were due to problems in its repair business, rather than mis-selling, which the company was in the process of resolving. After six months of intense scrutiny, the Ofcom investigation resulted in some minor changes to terms and conditions. ^[7]

There are also complaints from general consumers appearing on the web, with stories in Google News about disgruntled shoppers feeling pressured by hard sell tactics for phone insurance.^{[citation needed]} The retailer has begun to retrain staff and move away from some of its more aggressive practices, including ‘street-fighting’, the practice of sales people standing in shop doorways to lure in customers. ^[8]

Advertising and Sponsorship

Phones 4u is marked for its nuanced, creative and sometimes controversial advertising campaigns.

In 2004, the comedy duo Flight of the Conchords featured in a television advert driving up and down Britain singing about the latest offers. ^[9]

Phones 4u’s 2006 campaign starred a variety of eccentric characters, including ‘Jack’ and ‘Scary Mary’, who needed help with their mobile phones. The adverts were often set at the British seaside and featured the Phones 4u hand gesture for the first time, which would be revived for later campaigns.

In summer 2009, Phones 4u and communications agency Adam & Eve launched a new advertising campaign based around social networking and popularity called "Great Deals for Popular People". The theme around the campaign is that the customer needs to have 50 contacts on their phone to get Phones4U's best deals. In one of the ads, a scout master is displayed with the caption "You may be good with knots, you may be good with children, but there's no way you've got 50 friends on your phone", along with a large "NO" sticker. The campaign was met with criticism from the Scouting Association, and the advert was pulled.^[10]

In 2010, it launched the "It's What We Do" campaign. Television adverts showed proessional Mumbian wrestlers and Bangkok prison guards getting accustomed to a new handset.^[11]

In 2011 Phones4u switched its focus to a broader demographic, spending £5.2m on a horror-themed price-led promotion called "Missing Our Deals Will Haunt You". The campaign included two television advertisements: one taking inspiration from modern horror, featuring a young girl; with the other making a play on the classic zombie genre.^[12] In 2011, the firm's horror-led promotion was put under review by the Advertising Standards Authority after complaints about the use of a young girl in one of the telelvion adverts.^[13] In the same year, the ASA issued a rebuke regarding a Phone4u advert depicting Jesus alongside a range of Android phones with the message "Miraculous deals on Samsung Galaxy Android phones". The ASA said "although the ads were intended to be light-hearted and humorous, their depiction of Jesus winking and holding a thumbs-up sign, with the text "miraculous" deals during Easter, the Christian Holy Week which celebrated Christ's resurrection, gave the impression that they were mocking and belittling core Christian beliefs,".^[14]

Phones 4u have often backed its advertising campaigns with sponsorships. Television soap Hollyoaks and entertainment program Harry Hill’s TV Burp have both been sponsored by the retailer. A shirt sponsorship deal was agreed with Birmingham City FC for two seasons beginning in 2001.^[15]

References

1. ^ Caudwell Group Completes £1.5bn Sale To Private Equity Firms, Caudwell Press Release, 26 Sep 2006
2. ^ "Dialaphone sold for 'knock down' £9m". Mobile Today. http://www.mobiletoday.co.uk/News/5416/Dial-A-Phone_sold_for_%E2%80%98knocked-down%E2%80%99_%C2%A39m.aspx. 
3. ^ "Phones 4u sold in private equity deal". The Guardian. http://www.guardian.co.uk/business/2011/mar/18/phones4u-sold-private-equity-deal. 
4. ^ "Smartphones good and bad for Phones 4u". The Guardian. http://www.guardian.co.uk/business/2011/oct/03/smartphones-good-and-bad-for-phones4u. 
5. ^ "The Scotsman". Archived from the original on 2007-03-11. http://web.archive.org/web/20070311132108/http://thescotsman.scotsman.com/business.cfm?id=1141312006. 
6. ^ "Phones4U 'breached consumer laws'". BBC. 2008-11-10. http://news.bbc.co.uk/1/hi/business/7719957.stm. Retrieved 2008-11-25. 
7. ^ "Phones 4 u cites repairs". Mobile Today. 2008-11-10. http://www.mobiletoday.co.uk/Phones_4u_cites_repair_issues_as_reason_for_Ofcom_investigation.html. 
8. ^ "Phones retrains 3000 staff in 80 days". Mobile Today. 2008-11-10. http://www.mobiletoday.co.uk/News/6151/Phones_4u_retrains_3,000_of_its_staff_in_next_80_days.aspx. 
9. ^ "Flight of the Conchords Phones 4u advert". http://www.youtube.com/watch?v=EFo9nnmOU_4. 
10. ^ "Ad pulled after scouts complain". BBC News. 2009-06-16. http://news.bbc.co.uk/1/hi/uk/8102536.stm. 
11. ^ http://www.campaignlive.co.uk/news/1003666
12. ^ "Phones 4u Wins U Talk Marketing People’s Choice Award". UTalk Marketing. http://www.utalkmarketing.com/Pages/Article.aspx?ArticleID=22243&Title=Spooky_Phones_4U_ad_takes_People%E2%80%99s_Choice_award. 
13. ^ "Phones 4u's scary little girl is too scary for viewers". The Inquirer. http://www.theinquirer.net/inquirer/news/2116549/phones4u-scary-little-girl-scary-viewers. 
14. ^ http://www.metro.co.uk/news/874693-phones4u-jesus-advert-banned-for-mocking-christianity
15. ^ "£3million Shirt Sponsorship Deal Announced". birminghamcity-mad.co.uk. http://www.birminghamcity-mad.co.uk/news/tmnw/3million_shirt_sponsorship_deal__announced_11943/index.shtml. 

External links

• Official Website