increasing revenues and improving profitability, despite
intense competition.
DIFFERENTIATING THROUGH THE CUSTOMER EXPERIENCE
U.S. Cellular continues to differentiate itself from other wireless carriers through the Belief Project™, which rewards customers for their loyalty with relevant and meaningful benefits, such as early phone upgrades and free accessories.
At the end of 2011, 3.1 million new and existing customers—55 percent of retail customers—had selected Belief Plans, including higher-revenue data plans, which helped to increase average revenue per customer.
To drive subscriber growth, U.S. Cellular is also improving the effectiveness of its advertising, marketing and promotions. In 2011, U.S. Cellular launched innovative social business programs that leverage the “word-of-mouth” power of its most loyal customers to increase awareness and drive potential customers to the company’s retail stores and website.
INCREASING SMARTPHONE SALES AND DATA USE
As customer demand for smartphones and data services continues to rise, U.S. Cellular is increasing smartphone penetration by offering a competitive range of Android®-, Windows Mobile®- and BlackBerry®-based devices, including smartphones, tablets and modems, at a variety of price points.
At the end of 2011, smartphone customers were 30 percent of U.S. Cellular’s postpaid base, compared to 17 percent at the end of 2010. And smartphones were 52 percent of total devices sold in the fourth quarter of 2011, and 44 percent of devices sold in the year. This drove corresponding growth in data use—and in adoption of higher-revenue data plans—which, along with an increase in data roaming revenues, led to higher average revenue per customer.
As the industry moved toward tiered data pricing, U.S. Cellular prepared to introduce its own tiered plans in 2012, including entry-level plans to encourage customers to upgrade to their first smartphones.
ENSURING OUTSTANDING COMMUNICATIONS EXPERIENCES
Even though growth in data use has significantly increased traffic across U.S. Cellular’s network, the company kept pace with that growth and received its twelfth consecutive award for wireless call quality from J.D. Power and Associates in 2011, and received its thirteenth award in early 2012.
In conjunction with its partner, King Street Wireless, U.S. Cellular prepared its 4G LTE network and devices to support demand for data services and provide faster and more satisfying data experiences, while significantly reducing the cost to carry data traffic.
The company also added capacity to its 3G network and strengthened overall network capacity and coverage by adding 237 new cell sites.
INCREASING AGILITY AND EFFICIENCY
As part of its commitment to investing for the future, U.S. Cellular continued to improve its operational systems in 2011 through major enablement initiatives designed to help the company develop, market, sell and deliver services faster and more effectively.
U.S. Cellular enhanced the online customer experience with web-only promotions, instant Online Sales Support, a Data Estimator Tool, and Ask & Answer self-help capability. By early 2012, U.S. Cellular customers could purchase devices and accessories, change plans and redeem rewards online. The company implemented more customer targeting features of the Enterprise Data Warehouse/Customer Relationship Management system, including adding data related to customer transactions, prepaid customers, and marketing and demographics.
U.S. Cellular also made strong progress on its new billing and operational support system, which will include a new point-of-sale system and consolidate billing on one platform. The system is expected to be fully operational in 2013.