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Problem Orientated Project

Presented as part of the requirement of the Degree of Business Management, Canterbury
Christ Church University
...
”


Academic Supervisor: Miriam Sarrafan


Submission Date: April 25th 2016


Word Count: 7000


River Filmer


Declaration


“This Project is the product of my own work and has not been presented for any other
Award
...
”





River Filmer


























2

Table of Contents
Preface
...
4
Chapter One - Introduction
...
1: Company Profile
...
2: Problem
...

1
...
6
1
...
8

...
5 Objectives
...
9
2
...
9
2
...
10
2
...
11
2
...
11
2
...
12
Chapter Three – Methodology
...
1 Primary Data
...
2 Sampling
...
3 Secondary data
...
4 Questionnaire construction
...
5 Researcher and social desirability bias
...
6 Semi-structured Interview
...
19
4
...
19
4
...
30
Chapter Five – Conclusions
...
38
Acknowledgement
...
42
Appendices
...
44
Appendix II – Semi-structured Interview with Store Manager
...
47
Appendix IV – Consumer Empowerment Survey
...
49
Appendix VI – Final Questionnaire
...

Appendix VII – Quantitative data
...
53









3

Preface


Abstract


The purpose of the following study was to identify the factors that have contributed to a
year-on-year decline in the amount of mobile phone contracts sold at Carphone Warehouse
Canterbury Rose Lane
...
In further interviews with the store manager, the consensus of his opinion remained
with consumer buying behaviour, however introduced that post evaluation and customer
satisfaction may be impacting the return rate of previous customers
...
Pre-purchase evaluation was in fact found
to be pertinent to the problem following the results of primary data collected from the
general public
...


It has been concluded that the problem was both a consumer behaviour related issue
alongside other contributing factors explained in this report, including how Carphone
Warehouse as an organisation markets its capabilities to the consumer
...






4

Chapter One - Introduction


1
...
Carphone Warehouse aim to bring similar contract offers
to customers at a lower price without having to sacrifice any benefits that would be gained
by purchasing through a network store directly
...



1
...
The result is a shortfall of 324 contract sales year on year, which
equates to a 7
...
(See Appendix I for contract sales figures from 2014
and 2015) In a discussion with the store manager he said: “There is a decline in our year-onyear sales of contracts due to difficulty in getting customers to decide to come in and
purchase with us…” He highlighted a problem he has perceived by saying: “In terms of prepurchase evaluation, the main factor is that the consumers are not being educated by
Carphone Warehouse to know that we are better value for money prior to entering our
store…there are also many external factors including parking in Canterbury being the second
highest price per hour in the south of England, behind London
...
3: Impact



The significant impact of this decline in sales of contracts results in decreased revenue, and
therefore, profit
...
In a discussion with the store manager he said:
“We most commonly sell high-end contracts in this store due to our largely affluent client
base, however, due to our much lower contract prices purchased by parents for their children
the average levels out at between £27-£27
...
” (MoneySavingExpert, 2015)

In order to calculate the financial impact of Carphone Warehouse Canterbury’s drop in
contract sales; 324 contract sales multiplied by £27 equals £8,748, multiplied a further 24
times due to contracts being a duration of two years equals £209,952 in missed contract
revenue
...


A further impact to this problem is linked directly to the employees and their earnings
...
These targets
break down into:

•

Post-pay/contract Volume (PPV) – Amount of contracts sold
(Target varies every month)

•

Post-pay/contract conversion rate (PPCR) – Footfall vs contracts sold
(Targeted at minimum 6%)

•

World Class Service Score (WCSS) – After-sales text surveys to customers
(Targeted at minimum of 80%)

•

Reward (Commission) – Money paid to the individual who sells the contract
(Target varies every month)





6

The store’s employees earn reward throughout the month for selling mobile phone contracts
...
The minimum reward a salesperson can
take home per month is 30% of their individual earnings
...
This
could potentially decrease employee morale and even commitment, therefore having a
detrimental effect of further business practice
...
” (Singer,
1989
...
4 Aim

• To suggest practical measures to reverse the decline in mobile phone contracts sold
from the Canterbury store
...
5 Objectives

•

•

To provide reasoning and results from primary research conducted to determine
consumer buying behaviour with regard to mobile phone contracts, including the prepurchase evaluation decisions of potential customers
...



•

To use primary and secondary data to examine public trends in contract purchasing
through different retail models with particular focus on the mobile phone industry
...






















8

Chapter Two – Literature Review

Key themes throughout this literature review are related to both consumer behavior and
marketing due to the educated opinion of the branch manager and the context of the
perceived problem itself
...
5)


2
...

Solomon explains the four-stage model that consumers traditionally follow when deciding a
purchase
...
Other theorists such as Noel (2009) add a fifth stage to the model;
called “post decision process” which is an evaluation of the product or service after
purchase
...
He breaks this down into “limited
problem solving” and “extensive problem solving”
...
Elements such as
high risk and involvement reflect on the nature of being committed to a 24-month
agreement with Carphone Warehouse
...
The nature of this high amount of preparation needed, and reluctance
to commit without vast information search and researching of alternatives could be
delaying or even decreasing sales from the Carphone Warehouse Canterbury store
...







9



2
...
(2010) explains
...
Furthermore, the
customer’s loyalty to, in this scenario, a particular store or brand, and lastly; the perceived
value of what is purchased and how the service was delivered
...
” Therefore, a mobile phone; but more
importantly the 24-month contract that is attached to that phone is an experienced-based
product
...
Kanuk et al
...
According to ‘Nielsen’s
Customized Research Services’: “Word-of-mouth communications or recommendations
from other consumers…[is] the most trusted source of consumer information with 78 per
cent trusting such sources”
...
2010
...
Kanuk et al
...
”

Any previous customers that may have been dissatisfied with Carphone Warehouse’s
mobile phone recommendations, service and/or perceived value perhaps have not returned
to the same store, or may have opted to purchase from a rival competitor instead
...
above, perhaps
customer loyalty is a further problem
...






10



2
...
(2015) found “
...
” From this government survey it can be seen that
Williams et al
...


As described above (2
...
This
factor, alongside the potential for ‘extensive problem solving’ potentially means that
customers may alter the general price importance statistic when choosing a supplier is
concerned
...



2
...
as cited by Clausen, G
...
P45)
...
”(Sirvanci, 1993
...

2005
...
If a consumer is concerned heavily by the price they pay, they are therefore
price sensitive
...
This, paired with an article
from Simon Roberts, COO of Boots; whom says 83% of customers believe not price, but
“service quality” to be the key factor to loyalty provides a platform for which investigation
and comparison can be made with the author’s primary data
...
(2010) however mentions that “loyal customers are less price sensitive”
therefore indicating that finding a way to gain a customer’s loyalty through either better
service, more supplementary services or external factors may help an organisation when its





11

prices are higher then competitors
...
as cited by Eldring, J
...
P
...
Prices are higher than their supermarket competitors, but there are many other
factors that may add value to a consumer
...



2
...
” (Tyagi and Kumar, 2004
...
Advertising is
an extremely expensive tool for companies to use, and according to Harris and Seldon
(1962) is “difficult to accurately measure the success of…” (Harris and Seldon, 1962
...
This study aims to generate primary data from the public to
investigate whether Carphone Warehouse’s advertising practices are influential in the
customer’s purchasing decision and also whether their key marketing messages are being
communicated effectively
...









12

Chapter Three – Methodology



3
...
A minimum of 50 respondents was the objective, but
Saunders et al
...
Collecting ten
extra feedback forms was a plan of contingency in case of loss or any other unforeseen
implications
...
This time was chosen due to increased footfall of the Canterbury
High Street for between these periods due to lunchtime
...


Face-to-face questionnaires were found to be the most appropriate method of collecting
primary data due mainly for two reasons
...
Secondly, the limiting of researcher bias in the form of the author
specifically standing in areas that do not increase the footfall of any one type of customer;
for example, standing outside of an O2, Vodafone, EE, Three, or Carphone Warehouse store
...
Furthermore, there is
generally a lower response rate and greater risk of missing data; these examples are
especially reflective of postal surveys
...
Due to avoiding this, the respondents subsequently remained random
...





13

3
...
” (Samouel et al
...
Subsequently,
purposive sampling was included alongside a random selection process
...
” They explain that the purpose of pilot testing is to refine the questionnaire to limit
“problems” for the respondents and the researcher in collecting the data
...
(2011) that a “10 to 1” ratio was appropriate
due to the explanation that “today” purposive surveys that target a specific criterion within
a survey, such as telemarketing, use a 10 to 1 ratio
...
If the individual politely declined, the next tenth person would be then
chosen
...


The purposive sampling method was crucially important during the primary data collection
so to firstly; not waste the respondent’s time if they were found to be not applicable for the
questionnaire, and secondly, to not allow anomalies to form in the data collection and skew
the accuracy of the project as a whole
...
P175) However, the disadvantage to using a purposive
sampling technique according to Saunders, Lewis and Thornhill (2003) is that the sample will
never be an accurate representation of the whole population
...
According to Bryman & Bell, “interviewees may be selected ‘purposively’ on the





14

basis of their likely ability to contribute to theoretical understanding of a subject
...
P492) Samouel et al
...



3
...
” The
advantages of which that are relevant to this study include secondary data to be less timeconsuming, often more accurate and on a larger scale if from the government or specific
industry and, lastly, the data is likely to be of high quality due to the likely involvement of
experts, and access to better information providers
...
P128)

The majority of secondary data has been compiled throughout the embryonic stage of
analysing Carphone Warehouse’s problematic areas
...

(See Appendix III) Analysis of reputable web sources that focus on the mobile phone
industry have also been consulted and critically analysed in order to gain further insight into
the industry positioning
...
This
report discussed several consumer behaviour elements such as decision styles when
choosing a service supplier
...
(See
Appendix IV)














15



3
...
Although according to Bryman & Bell (2011) closed questions are normally
favoured in surveying, however, it is explained that both open and closed questions suited
the questionnaire that was used in the primary research conducted by the author
...
” (Bryman & Bell, 2011
...
It is clear from the majority of the questions in
the final questionnaire (see appendix VI) that there was space underneath each closed
question for the respondents to provide qualitative feedback if any unusual or unforeseen
answers came to their mind
...
In hindsight, the
decision to include ‘comments’ sections for qualitative feedback resulted in valuable and
otherwise unobtainable information from the respondents
...
Four options were initially adopted and are as
follows: not important, slightly important, rather important, very important
...
This feedback demonstrated a fifth option should be
implemented and, as such, an ‘unsure’ option was included in the final questionnaire
...
(See Appendix V) The author was later-informed by a relevant secondary
case study survey performed by the government, and, the reinforcement of the
aforementioned theory surrounding pre-purchase evaluation to implement this question
...
Due to the differing style of ranking between the ‘ranking of sources’ question and
the ‘Likert-style’ question 15% of respondents (9) were confused by the instruction of the
question and had to be prompted to complete this question again
...
(See appendix VII)


3
...
These
two terms are similar, however, they are both vital components to achieving validity
...
The main investigation
of this study is validated by the theory of ‘criterion validity’ whereby another reputable
source of information informs the study of another, and based on their correlations
matching, validity is achieved
...
(2011) Many similar and some exact
correlations have been found with the aforementioned theories and government survey
concerning decision styles that were used as criteria for this report
...
Construct validity is that of “deducing a hypothesis
from a theory relevant to the concept
...
P160) An example of this is
the hypothesis that the continued underperformance of the sales staff, resulting in lower
monthly bonuses, has a direct effect on their morale, commitment and future performance
...


Social desirability bias is something that cannot be eliminated by the researcher and is
described as a subsequent tendency to be somewhat disingenuous as to appear in the
manner the respondent feels they ‘should’, due to “answering through a filter of concern as
to what will make them look good
...
P80) There is a particularly high





17

chance of social desirability bias in a face-to-face interview and/or questionnaire situation
...
However, the questionnaire posed to the public was designed with this in
mind, and so the questions were designed to focus more on asking questions that evoked
genuine reactional answers that would not single out any person or make them feel judged
...
6 Semi-structured Interview

A semi-structured interview was conducted with the store manager of the Canterbury Rose
Lane store on 05/02/16
...
(See Appendix II for interview transcript) According to
Saunders, Lewis and Thornhill (2003) the reasoning for a semi-structured interview is when
the questions are complex, open-ended and not fully structured in a logical order at all
times
...
The store manager’s
opinions and beliefs are based on statistics that he deals with such as footfall amounts
...
However, he has been in this industry for over 15 years and has previously been a
branch manager for EE, and now deceased, Phones 4u
...

Disadvantages to this type of interview include, firstly, the lack of standardisation,
potentially leading to concerns with reliability; and secondly, interviewer bias
...
Saunders, Lewis and Thornhill (2003)









18

Chapter Four – Data Analysis




4
...
It was apparent that on the day of sampling, that 67% were
under 30 years of age with 38% of respondents represented the 18-23 age category
...

However, as previously explained; the simple random sampling technique was used, and
therefore, researcher bias regarding respondent selection was minimised therefore
reinforcing validity
...
1 – “Which organisation did you purchase your current mobile phone contract
from?”



Organisation used to purchase current
mobile phone contract










20
18
16
14
12
10
8
6
4
2
0

18
15
13
9

Carphone
Warehouse



O2

Vodafone

8

EE

Three





Question 2
...
The specific
wording of asking which ‘organisation’ rather than which ‘provider’ they are with eliminated
the confusion of respondents choosing the service provider they are with (e
...
O2) instead
of the organisation they purchased from (e
...
Carphone Warehouse
...


This question was asked in order to see the average amounts of the public that visit the
network stores directly instead of Carphone Warehouse to discover the current missed
opportunity
...
These figures reflect, firstly, the lack of growth in Carphone
Warehouse Canterbury’s store sales; as over the past two years the majority of the public
have remained loyal to the network stores; and secondly, the theory of post-purchase
evaluation, as customers seem to be returning to competitors due to either loyalty, reduced
price sensitivity or being content with the service
...


The survey questions were asked of the public walking through Canterbury town with the
assumption that they would purchase from the Rose Lane store
...
This may have been a potential oversight from the author
in constructing the questionnaire resulting potentially in some data that does not fully
reflect the native Canterbury public
...
”

(Figure A)








Figure A (above) demonstrates the ranking system for question three from the final
questionnaire (See Appendix VI)
...
The graph below indicates the average score of each category by taking all scores
of each scale of importance and dividing the total by the number of respondents (60)
...
” (DeVaus, 2002
...
P298)




Average importance of elements influencing
the purchasing decision





Staff personality/Service



3
...
6
2
...
4

Lowest Price
2
...






Elements

Rank

Number of respondents

Advertising and reputation

4
(Important)
5
(Very important)
3
(Unsure)
5
(Very important)
1
(Unimportant)

27

Staff personality/Service





Researching alternatives
Lowest price




Location



23
14
39
19


This question allowed for an understanding of what is important to, and what influences the
public when deciding to purchase a mobile phone contract
...
Location was the only source of influence that was
ranked by the majority as ‘unimportant’
...
However, this study focused on a small sample of 60 respondents
...
The
study also reinforced the theory and secondary data provided earlier that describes service
as a very important post-purchase evaluation tool
...
The conclusion from both this and the author’s study has
resulted in the most popular decision style being ‘lowest price’ followed by the service
people receive
...
Do you think purchasing a contract on EE, O2 or Vodafone through Carphone
Warehouse would be lower or higher priced than going directly to the network store?”



Third-party price assumption






50

47

45
40
35
30



25



20



10



5



13

15

0
Higher

Lower


Question four was structured as multiple choice, however, only offering two options; one
for higher and the other for lower
...
It is recognised that having no ‘unsure’ option may have lead
people without an opinion into a choice they may not feel strongly about
...


This question was asked in order to investigate the general perception of the public as to
which retail model (third-party or direct-to-store) was lower in price
...
Evidently, the message is
not being communicated effectively due to 78% of respondents believing Carphone
Warehouse is more expensive than its direct competitors
...
This element also falls into pre-purchase
evaluation as previously mentioned; Solomon (2002) explains that: “…multiple sources [are]
consulted prior to store visits”
...
“According to new research conducted by UK retailer Shop
Direct, one in four British people now shop online at least once a week…with one in five of
the 1,000 surveyed saying they used their device to shop and one in ten using a
smartphone…now 95% of British people buy goods via internet retailers…and electronics
account for 54
...
]” Fiona Ellis Chadwick, senior lecturer in
retail management at The Open University Business School reinforced that “the customer
experience has drastically changed…” (Mail Online, 2014)

A significant portion of the sample surveyed (32%) announced they purchase online
...
” However,
many respondents of the majority (68%) whom chose to comment said their choice for in
store purchasing is so they can see and feel what they are buying before committing to it for
24 months
...
”
(Figure B)










Figure B (above) displays the layout, and information provided for question six
...
The respondent was asked to place each number (1-5) only once to display their
order of importance
...
“In general, respondents
find that ranking more than seven or eight items take too much effort, so you should keep
your list to this length or shorter (Kervin, 1999, as cited in Saunders, Lewis and Thornhill
2003 P296)



Average importance of pre-purchasing sources





1
...
8

Independent online review sites

3
...
5

In-store staff
0

0
...
5

2

2
...
5

4

26

A chart of the highest majority of each source has again been provided below to increase
clarity, and to provide the most accurate representation of the data collected
...
Finding out this information allows Carphone Warehouse
to better understand how potential customers review the sources of information available
to them and develop the most effective method
...
This figure may reflect the importance to the public when
making their purchase decision, however, television adverts aim to bolster brand
reinforcement alongside displaying certain products, and so this does not reflect fully the
organisation’s aim for their advertisements
...
P85) This is reinforced by Kotler and Armstrong (2010) through
their explanation that the sole goal of advertising is not just to retain market share, but to
increase consumer awareness of a brand
...
This statistic correlates with the findings of the aforementioned
‘Nielsen’s Customized Research Services’ as explained that: “Word-of-mouth
communications or recommendations from other consumers…[are] the most trusted source
of consumer information with 78 per cent trusting such sources
...
2010)
If Carphone Warehouse are not improving year-on-year in sales, the problem then may be
resultant of poor service or a lack of knowledge in the consumer’s post-purchase evaluation
...


Question 7 – “Does Carphone Warehouse advertise that they compare the most networks?”


Does Carphone Warehouse compare the


most networks?




40

38

35



30



25



22

20
15



10



5



0
Yes

No


Question seven was designed for two purposes; firstly, to investigate what percentage of
the public sampled understood what Carphone Warehouse’s business practices entail, and
secondly, whether advertising and/or marketing is contributing to the problem overall
problem
...
A relatively high percentage of the public
(37%) have not been reached by Carphone Warehouse’s communications
...
This could be
rectified in further repeated studies by adding a separate question so to ask both elements
separately for greater accuracy and validity
...
Secondly, to discover whether Carphone Warehouse’s main message
is being received by the public
...
This statistic alone demonstrates Carphone Warehouse has
a problem communicating their unique selling point to customers, despite an expansive
marketing campaign utilising a popular celebrity
...
2 Qualitative analysis

The following analysis is of the three questions from the final questionnaire that probed for
a purely qualitative response
...
“Quantitative data can be divided into two distinct groups: categorical
and quantifiable…categorical data refer to data whose values cannot be measured
numerically but can be classified into sets (categories) according to their characteristics…”
(Saunders, Lewis and Thornhill
...

Saunders, Lewis and Thornhill (2003) All respondents remained anonymous and so the
author has numbered each questionnaire from one to sixty to reference specific quotes
...
Quantitative data has displayed the general consensus of the sample,
however, without an indication as to what made the respondent choose a particular option,
there is a prescribed lack of perspective and reasoning for their opinion
...







30

The most popular reasoning for the decision to select ‘higher’ was due to the public
assumption that the organisation being third-party or a “middle man” came with associated
higher costs and the need for “extra commission” to pay for staff
...
” Respondent 17 however
stated: “They [Carphone Warehouse] are more expensive but they help you more
...
”

Of the 13 respondents that selected ‘lower’, eight decided to comment on their decision
...
Respondents 12, 31 and 44 stated that Carphone
Warehouse is lower in price than their network rivals due to their mere existence
...
” Respondent 31 stated: “Carphone Warehouse has to be cheaper
otherwise it cannot operate as competitor to the networks” Finally, Respondent 44 stated:
“Carphone is not cheapest for contracts you can get better online
...
”

It can be concluded from these responses that the majority of the public are not
understanding Carphone Warehouse’s place in the market, nor do they understand that due
to economies of scale, Carphone Warehouse must purchase more phones from the
manufacturers than the network to cater for higher volumes of sales across multiple
networks
...











31

Qualitative question 2



This question was designed with the intention to discover both any assumptions of the
public but also, and more importantly, what objections people have when deciding not to
purchase through Carphone Warehouse
...
The advantage
is due to the question singling out only those who have never purchased through Carphone
Warehouse previously; these are the exact people the study is aimed at
...
However, during the final questionnaire a very
low number of people decided to fill out this question
...
” which is evidently with a competitor
...
” Respondent 16 stated: “I get better deals through my local O2
shop
...
They have bad service
...
Firstly,
that the younger generation tend to be often lead by their parent’s decisions and
recommendations, or the place their parents previously visited
...
Secondly, the study has discovered that many
respondents aged 41 and over from the sample explained that they “go where they have
always gone” and that they are loyal to their network
...
”




32

Qualitative question 3



The highlighted area above is a follow-on question from the quantitative one above it asking
for a simple yes or no answer
...


It was expected from pilot testing that this question would receive a low response rate,
however the importance of the potential answers is what allowed the question to remain
...
The majority of respondents claimed they, if fact, knew that Carphone
Warehouse compares the most networks; 22 from 60 people said they do not
...
I always
watch YouTube but never watch TV, plus its cheaper
...
”
Respondent 14 stated: “They need to advertise that there is more on offer than just what
the networks sell or people will think it costs more
...

However, a potential oversight is the question of the respondents simply assuming that
Carphone, in fact, do; purely due to them being a third-party organisation
...
In future repeated surveying the follow-on
question should be out of immediate eye-line as to not influence the respondent’s decision
in any way
...





































34

Chapter Five – Conclusions

The reasoning for Carphone Warehouse Canterbury’s problem of declining year-on-year
sales of contracts has been concluded below surrounding eight key aspects
...
However, these conclusions have also been informed by secondary data relative
to the mobile phone industry, and finally, underpinned by theory so to achieve
triangulation, and therefore, validity
...


The data analysis displayed that 63% of the respondents within the sample understood
Carphone Warehouse compares the most networks
...
Further to this, a mere 17% of the
sample thought it was possible to upgrade for a lower price at Carphone Warehouse whilst
keeping the same phone number
...
This is clearly representative of the problem Carphone
Warehouse is currently facing, as they are limiting their ability to attract new customers
...


2) Lowest price and good service from staff were the most popular decision styles
...
This conclusion correlated exactly with that of the Government
‘Consumer empowerment survey’ conducted surrounding choosing a mobile phone
supplier; which informed the questionnaire of this study
...






35

3) Location is not a significant factor in the pre-purchase decisions of the Canterbury
public
...




4) Carphone Warehouse is perceived by the sample as being more expensive than the
network stores
...
Alarmingly, from the 22% that assumed Carphone Warehouse is
lower in price than the networks, the majority could not provide reasoning for their
selection
...
This clearly reflects the
overarching problem the store is having
...


Due to 32% of the sample claiming they purchase online due to perceived lower prices and
added extras such as cashback, paired with theory reinforcing that online purchasing is
increasing, Carphone Warehouse Canterbury’s store sales are being reduced by online
purchasing
...


This conclusion displays a lack of knowledge of Carphone Warehouse’s core services, and
reinforces that their advertising content needs adapting to target network customers
...


This is signified by the majority of the public whom display loyalty to the provider they are
with, claiming they habitually re-purchase where they, or their family have always gone
...
This means many people are not considering Carphone Warehouse as an option
before they purchase elsewhere
...


8) The Canterbury store is being targeted inaccurately by Carphone Warehouse,
resulting in fewer staff bonuses and potentially undeserved ‘underperformance’
...
This means the
Canterbury store is converting a minimum of 6% of their footfall into contract sales, which is
the target governed by Carphone Warehouse management
...
This reveals the PPCR targeting system is
inaccurate given the footfall of the Canterbury store
...

The PPCR targeting system is, therefore, creating virtually unachievable targets for the store
to hit given their recent footfall
...
The
problem is also linked to pre and post-purchase evaluation as the customers visiting the
Canterbury store have reduced year-on-year, yet the PPCR target remains the same
...
Resource implications and the feasibility of their implementation have been
considered
...


1) Revise the store PPCR, Volume and Reward targets
...
This is to provide
a fair and achievable target for the store to hit which reflects a minimum of 6% post pay
conversion rate of the footfall
...


2) Improve the way employees can earn their reward (bonuses)

A related recommendation to number 1 is that the targeting system as a whole should be
revised
...
This means, at present, success in achieving contract volume does not earn
employees their reward bonus, this is a conflict of interest for employees and has resulted
in a frequent loss of income for the Canterbury store staff over the past eight months
...
This
implementation could be rewarded each month with the top 100 employees earning £100
...







38

This recommendation will improve motivation to sell higher contract volume, which in turn
will raise staff morale; whilst potentially maintaining commitment of employees and
increasing the second highest ranking pre-purchase influencer; service quality
...
An incentive such as a free case and/or screen protector for any phone they
buy will be offered if they come and upgrade for a lower price with Canterbury store
...


4) Introduce a marketing campaign surrounding segmentation

Carphone Warehouse should develop a marketing campaign, including advertisements that
target specific problem markets
...
An
advertisement similar to that of players in the supermarket industry such as Asda, Tesco and
Aldi is being suggested also
...
Aldi
demonstrate this by comparing an Asda, Tesco, Morrisons or Sainsbury’s product to that of
their own brand to display a significantly lower price, however, without sacrificing any
benefits
...









39

5) A refer-a-friend discount scheme

Based on the conclusion that recommendations are the most powerful source of influencing
consumer behaviour, a referral discount scheme is being recommended
...

The only criteria would be that the friends they refer must have never had involvement with
Carphone Warehouse before, and must be purchasing a 24-month contract
...
A
multiplier system can be implemented also that entitles the most loyal customers whom
refer enough people within a given period to even better discounts and deals
...
(2010) due to his
aforementioned explanation that “loyal customers buy more products” and “loyal customer
spread positive word-of-mouth and refer other customers
...
Phone reviews and general information regarding
the organisation’s practices can be communicated to a potential target market of online
technology enthusiasts that may not have been reached by prior communications
...
This method of
communication can also be monetised through ‘Google Adsense’ in order to provide a
return on the investment of production time and costs to create high quality content
...
The sample surveyed within this study, however, have provided a
valuable insight into the problems Carphone Warehouse Canterbury are currently facing
...
Any
potential oversights made by the author during the inception, creation and completion of
this project have been announced through critical analysis of the study as a whole
...

























41

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Armstrong, P
...
(2010)
...
London: Pearson education
...
R
...
Research methods for social work
...

Babin, W
...
(2012)
...
Mason: Cengage learning
...
(2011)
...
3)
...

Bryman, A
...
(2011)
...
3)
...

Burrows, T
...
Online shopping 20 years on
...
dailymail
...
uk:
http://www
...
co
...
html
Clauson, G
...
Price sensitivity for electronic enternainment
...
com
...
(2009)
...
Hamburg: Druc
diplomica
...
T
...
Advertising management
...

Langdon, D
...
Apple pie, beds and eggy bread
...

Law, J
...
(2013)
...
New York:
The haworth hospitality press
...
(2015)
...
Retrieved December 6, 2015, from
moneysavingexpert
...
moneysavingexpert
...
(2009)
...
London: AVA Publishing SA
...
J
...
Essentials of Business Research Methods (Vol
...
New York: M
...

Saunders, M
...
(2003)
...
3)
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Schiffman, L
...
(2010)
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10)
...

Seldon, H
...
(1962)
...
London: University press
...
(1989)
...
New Jersey: Transaction publishers
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5)
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42

Williams, B
...
(2015)
...
Retrieved from www
...
uk:
https://www
...
uk/government/uploads/system/uploads/attachment_data/file/413511/B
IS-15-208-consumer-empowerment-survey
...
B
...
8)
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43

Appendices


Appendix I – Sales figures 2014/15




Month

2014

2015

Variance

January

342

275

-67

February

332

323

-9

March

289

261

-28

April

470

448

+22

May

389

358

-31

June

381

320

-61

July

421

394

-27

August

328

317

-11

September 403
October
589

393
525

-10
-64

November 379

385

+6

TOTAL

3,999

-324

4,323
























44

Appendix II – Semi-structured Interview with Store Manager

The following interview was carried out between the author and the Canterbury store
manager on 05/02/16
...
This to me clearly demonstrates that the store is doing its job efficiently,
the organisation is just not sending the custom our way…”

Q: “How has contract sales performance throughout 2015 compared to 2014?”
A: “Firstly, we are not getting as much footfall this year…not even close… and our weekdays
we struggle to hit minimum contract volume target
...
The weekends also are no where near
as busy as they were last year, footfall has reduced massively as last year the team were miles
off PPCR yet hitting target still
...
The
organisation is not creating enough buzz around the new products
...
We haven’t seen a real buzz for a product launch since the iPhone 4s
...
It is questionable whether many
people do not want to come all the way to Canterbury and pay almost £2 per hour for parking
to walk around and get cold
...
Lastly, the organisation pushes the wrong messages to the public attempting
to drive in high footfall, mainly surrounding a low-price deal that appeals to a narrow market
...
”





45

Q: “You say the majority of causes are external due mainly to a lack of knowledge on the part
of the customer, why do you think this is, and can it be rectified, if so how?”
A: “Yes, it can be rectified if the organisation sends out the right messages to the public
...
I would say the
average is between £25-£28 per month
...
If we are
not hitting numbers that reflect year-on-year footfall, then it seems quite evident that we are
losing customers to the networks or online
...
This is also reducing our chance of getting customers into the store and showing them
what we are all about, I know that for a fact
...
2013: (£25m)
loss
...
”
Source: (Cityam, 2014)
--------------------------------------------------------------------------------------------------------------------------
EE 2014 Q3 “Operating revenue” down by 1
...
3 per cent year-on-year” (Compared with Q3 2013)
“…to £1
...
”
Source: (Mobilenews, 2015)

Vodafone 2014 Q3 “Q3 Group service revenue declined by 0
...
However, Carphone
Warehouse has declined by a significant amount more than the others
...
gov
...
pdf















48

Appendix V – Pilot Questionnaire



(One single page)











49

Appendix VI – Final Questionnaire



(Front page)













(Rear page)






















50

Appendix VII – Quantitative data




Below are the overall results for all eight quantifiable questions asked to 60 members of the
Canterbury public with their respective percentage weightings attached
...
3%)
• 24-29 = 17 (28
...
3%)
• 50+ = 6 (10%)


Q2) Organisations

2
...
6%)
• O2 = 18 (30%)
• Vodafone = 9 (15%)
• EE = 15 (25%)
• 3 = 5 (8
...
2) Previous organisation:
• CPW = 14 (23
...
3%)
• Vodafone = 11 (18
...
6%)
• 3 = 8 (13
...
= 3
...
= 3
...
= 2
...
= 4
...
= 2
...
7%)
• Higher = 47 (78
...
7%)
• In store = 41 (68
...
8
• Television advertisements: | 1 = 12x | 2 = 10x | 3= 9x | 4 = 12x | 5 = 17x |
Av:3
...
8
• Official network website: | 1 = 6x | 2 = 15x | 3 = 10x | 4 = 14x | 5 = 15x |
Av: 3
...
5


Q7) Does Carphone Warehouse advertise that they compare the most networks?

• Yes = 38 (63
...
7%)


Q8) Does Carphone Warehouse allow you to upgrade and keep your number and tariff at a
lower price?

• Yes = 10 (16
...
3%)










52

Appendix VIII – Executive Summary

•

The Carphone Warehouse Canterbury Rose Lane store was the case study for this
project
...


•

This shortfall has contributed to missed potential contract revenue of £209,952
...
This was due to
internal evidence of reduced store footfall when compared year-on-year
...
These were: ‘post-purchase
evaluation’, ‘Carphone Warehouse’s advertising’ and ‘the store’s targeting system’
...


•

The two most important factors (decision styles) influencing the decision of where to
purchase a 24-month contract were Lowest price and Good Service/Staff personality
...


•

78% of the sample perceive Carphone Warehouse as ‘higher’ in price than the
network stores
...


•

The recommendations from friends and family ranked significantly higher than all
other sources that influence pre-purchase evaluation; followed by review websites
...
This has been concluded as an advertising problem
...


•

Recommendations have been provided to reverse the current decline in contract
sales, and footfall

---