It was the conversion of London’s Millennium Dome into leading entertainment venue, The O2, that saw O2’s brand identity branch beyond the mere connection of mobile phones.
The launch of O2 Money this month represents the next step in this strategy with the creation of not only a new product, but a new business unit and commercial partnership with NatWest. Perhaps most importantly, O2 has devised a new way to draw customers away from the temptation of moving to a rival network.
O2 executives revealed at O2 Money’s London launch this month that the network was looking to become a company that offered “connective services”. O2 Money is to bring out future products beyond the two initial prepaid credit cards (one aimed at adults and one at children over 13), which chief executive Ronan Dunne was loathe to discuss, beyond confirming that this is O2’s bid to become a player in the personal finance market.
Said Dunne: “The success of O2 is built on the fact that we don’t stand still. We want to move from a mobile company to a great service company. We won’t talk about new products but it is the start of a new journey into the personal finance sector. They will be integral parts of the same industry in due course but mobile will always be at the core of our offering.”
“The handset is becoming the ‘remote control’ that people use to control their lives, so the money and mobile spaces are converging. We saw an opportunity to introduce ourselves to the personal finance space, establish credibility there and build on our customer insights,” Dunne added.
By way of offering a rationale for the move, Dunne cited a range of analyst and research statistics. According to Juniper, the global mobile payment market is expected to be worth more than £365 billion by 2013; and from education charity The Personal Finance Education Group (pfeg), more than one in five under 18s made an online purchase in the past year using a debit or credit card belonging to a parent or older sibling.
He also claimed that 25 per cent of British people are unaware of how much they spend in a week, to prove there is a marketable audience for the product.
Dunne refuted the idea that the move meant the mobile industry had reached its growth limits, saying: “We are not looking to set up retail banking in competition with NatWest.”
O2 UK customer director Tim Sefton added: “We are not going to be like Virgin and put our brand on lots of different unrelated products. We need to be able to explain the logic of a connection to customers. I would personally be surprised if other operators aren’t looking into this area with their own strategies.”
Full article in Mobile News issue 444 (july 27, 2009).
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