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Posted by Charles Golvin on January 13, 2010
As I wrote following the launch of Google's Nexus One phone and its online retail store, Google will be an influential retailer, but isn't today because what they offer isn't different from what's available from carriers or merchants like Best Buy or Amazon — it's only differentiated by its exclusive on a hot device.
Most people who buy phones today want to feel the heft of the device, play with its UI, get a sense of the experience of using it since they're making a long term commitment to it. As a result, most phones are sold at operators' retail outlets or at physical retailers. During the launch event I asked Google's Andy Rubin, the driving force behind Android, whether they felt that they may in the future need to expand to include physical retail (such as a carrier partner's stores). He said no, that consumers are increasingly going to buy their phones online just like they buy digital cameras. He is likely correct, but (again, as I wrote) that time is well into the future.
What wasn't explicit in my question, and which the initial flurry of Nexus One sales experiences has exposed, is the stark reality that being in the retail phone business involves a lot more than the sale itself. Today the news is full of stories of Nexus One owners frustrated at their inability to get access to a human being to help resolve problems or answer questions related to their new phone. (It hasn't helped that the device itself appears to have some problems accessing T-Mobile's 3G network, and that buyers may not have checked the presence of 3G coverage where they live and/or work.)
What lessons should we draw from this?
I expect Google will weather this storm without too much damage. They're wicked smart, and their online resources will anticipate and address many more of their customers' challenges going forward, so that the Nexus One's core audience of skilled and self-sufficient online users will find their path smoothing out quickly over time. And consumers tend to be more forgiving of a device, which may go through hiccups before working well, than of a service provider and their annoying monthly bills.
But I think Andy's vision for mobile retailing will take a lot longer to obtain than he would like.
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