10 Dos and Donts for Choosing a Mobile Cap Plan
August 14th 2006 00:54
In writing this entry I try and debunk some of the consumer mistakes I see so often when trying to get customers the best plan to suit their needs. Some of it seems very logical, but most people don’t follow it in the heat of the moment when the sales assistant tries to close the sale!!
The Dos and Don’ts about Choosing a Cap Plan.
1. Do look at the call rates!
So often I have customers trying to compare caps from different companies solely on the cap limit. This is a huge mistake! Hypothetically, just because one company is allowing you to spend $1,000,000 and another one $100 does not make the $1,000,000 “better” especially if the call rates were $1,000,000/min and $1/min respectively.
In a real world scenario you can look here at the call rates per 30 seconds of the 4 major 3G providers in Australia on each of their $49 caps respectively:
Telstra – 40c/30sec
Optus – 35c/30sec
Voda – 40c/30 secs
Three – 30c/30 secs
This is not to say however that these are the call rates of the higher caps! For some companies the higher the cap, the lower the call rates will be. What I have show is that there is definitely a difference in call rates and trying to compare what $200 worth of usage on say Telstra, may not be the same as $200 on Three.
What you have to note is that in the long run 5-10 cents for every 30 seconds really does add up.
2. Don’t forget the flag fall.
For those who don’t know what flag fall it is the connection cost of a call.
So many times people ONLY look at the call rates and disregard the flag fall costs. Unfortunately, flag fall is the only thing that is certain when you are calling from these caps. The most common type of call (according to our marketing department) is the 2 minute call. Essentially the two minute call comprises of flag fall 4 x 30 second blocks.
Considering that flag fall is generally close to the price of one 30 second block it does get rather expensive if you make many short calls, as opposed to a few long calls.
If the flag fall were to say be 25 cents. When you’ve made 100 calls that would already cost you $25. What’s more shocking is that you have not spoken to the person on the other side of the line yet, all you’ve done is connected. If you’re thinking that 100 calls is a lot you should think again, that means just a little over 3 calls a day.
3. Do look at what your usage is like.
If you like to make a great deal of short calls, you’ll want to look at a plan with a low flag fall. The longer your calls the smaller the percentage of the total call cost is made up of flag fall.
So inversely, if you make long calls you’ll want to look for a plan which supplies you with a low call rate. If you only SMS, take a cap with a high cap limit. SMS prices are pretty much standard on all cap plans
I know you probably think “I use a bit of everything”. Well the only answer to that is to look at a typical month of usage and calculate all your costs yourself, no easy way to do it perfectly.
4. Don’t assume all companies include all call types into their caps.
All phone companies include voice calls and SMS in their caps but what you have to look out for is what is not included. Key types to look up are: international voice calls, video calls, voicemail, international SMS, national MMS, international MMS, 13/1300/1800 numbers and directory assistance.
If they are not included in the cap then you pay for them separately, so it’s always good to check on any that you occasionally use. The one I get asked about the most is international voice calls but it might be different for your situation.
5. Do find out about on network extra calls and credit.
Some companies allow you to make extra calls to anyone on their network and are always a bonus. This is especially true if you know people who are on that network and even better if you call them often!
For some people this feature, is a make or break in terms choosing one cap over another and creates communities of users on one network. One member will join a network and then bring their whole family over to keep in contact with each other for little to no cost to them.
6. Don’t justify to yourself “I’ll never spend that much anyway”
This point kind of follows on from the look at the call rates point. Looking at the caps at face value does not work. So many people say “I’ll never spend $400 worth of calls anyway”. But they do!!!! Don’t look at it in terms of monetary value. Instead calculate how many calls you can make from the cap limit.
Sales reps will point out how much monetary value you’re getting out of them, but to point out how many calls you can make with that might be another story.
7. Do ask about any specials that maybe included in the plan.
For a period of time Vodafone and Optus were including certain amounts of free browsing of their “Vodafone LIVE!” and “Optus ZOO” respectively when you signed up.
Three also have 50c for 10 minute Three to Three video call Sundays. Although video calls are not included in the cap, if you are already over your cap limit this effectively puts your call rate at 2.5c/30 seconds
8. Don’t ever call or text competition lines if you do not want to pay extra for them.
Competition lines (19/1900) will never be included in your cap. You will always pay extra for them and they are expensive in general.
9. Do find out how to check how far into your cap you are.
This is just because there are so many people who have taken the caps at face value and assume that they will never go over their cap because the limit is so “high” and thus never bother checking how far into their cap they are during the month.
In essence it’s awkward for the sales assistants because it was not our fault but their bill is a lot higher than they first thought. We then show them how to check their cap and then they go on their merry way.
I would just implore you not to get caught out in the first place!
10. Don’t just allow the first sales assistant to close the sale without checking the competitors!!
The most obvious one of the lot, it’s just that some sales reps are really convincing. They believe in their product to no end and can sell a mobile to a Luddite. If you’ve hit one of these and haven’t checked the competitors, don’t just say yes straight away but let them know you’ll think about it. You may find that another company has a cap that works more like you do.
Well that’s it. I like to think of all the cap plans as the glass slipper, there’s always one that will fit better than the rest. Here’s a bit of a glimpse of comparing the four $49 caps I was talking about earlier. The thing to take note of is the “cap limits” of the four being $200, $230, $280 and $230 for Telstra, Optus, Vodafone and Three respectively.
These are all estimates and the yellow signifies the best while the red signifies the close competitors that are within 10% of the best. Each of the rows represents 100% worth of usage in that particular type of call or SMS. So for the first row that means you use the whole cap only on 1 minute calls to other networks. In bold are the most common type of call "the two minute call".
If you have any questions give me a yell as per usual at mobiletales 064 gmail 046 com.
Next time at mobile tales we look at "What is 3G?"
- Ben
The Dos and Don’ts about Choosing a Cap Plan.
1. Do look at the call rates!
So often I have customers trying to compare caps from different companies solely on the cap limit. This is a huge mistake! Hypothetically, just because one company is allowing you to spend $1,000,000 and another one $100 does not make the $1,000,000 “better” especially if the call rates were $1,000,000/min and $1/min respectively.
In a real world scenario you can look here at the call rates per 30 seconds of the 4 major 3G providers in Australia on each of their $49 caps respectively:
Telstra – 40c/30sec
Optus – 35c/30sec
Voda – 40c/30 secs
Three – 30c/30 secs
This is not to say however that these are the call rates of the higher caps! For some companies the higher the cap, the lower the call rates will be. What I have show is that there is definitely a difference in call rates and trying to compare what $200 worth of usage on say Telstra, may not be the same as $200 on Three.
What you have to note is that in the long run 5-10 cents for every 30 seconds really does add up.
2. Don’t forget the flag fall.
For those who don’t know what flag fall it is the connection cost of a call.
So many times people ONLY look at the call rates and disregard the flag fall costs. Unfortunately, flag fall is the only thing that is certain when you are calling from these caps. The most common type of call (according to our marketing department) is the 2 minute call. Essentially the two minute call comprises of flag fall 4 x 30 second blocks.
Considering that flag fall is generally close to the price of one 30 second block it does get rather expensive if you make many short calls, as opposed to a few long calls.
If the flag fall were to say be 25 cents. When you’ve made 100 calls that would already cost you $25. What’s more shocking is that you have not spoken to the person on the other side of the line yet, all you’ve done is connected. If you’re thinking that 100 calls is a lot you should think again, that means just a little over 3 calls a day.
3. Do look at what your usage is like.
If you like to make a great deal of short calls, you’ll want to look at a plan with a low flag fall. The longer your calls the smaller the percentage of the total call cost is made up of flag fall.
So inversely, if you make long calls you’ll want to look for a plan which supplies you with a low call rate. If you only SMS, take a cap with a high cap limit. SMS prices are pretty much standard on all cap plans
I know you probably think “I use a bit of everything”. Well the only answer to that is to look at a typical month of usage and calculate all your costs yourself, no easy way to do it perfectly.
4. Don’t assume all companies include all call types into their caps.
All phone companies include voice calls and SMS in their caps but what you have to look out for is what is not included. Key types to look up are: international voice calls, video calls, voicemail, international SMS, national MMS, international MMS, 13/1300/1800 numbers and directory assistance.
If they are not included in the cap then you pay for them separately, so it’s always good to check on any that you occasionally use. The one I get asked about the most is international voice calls but it might be different for your situation.
5. Do find out about on network extra calls and credit.
Some companies allow you to make extra calls to anyone on their network and are always a bonus. This is especially true if you know people who are on that network and even better if you call them often!
For some people this feature, is a make or break in terms choosing one cap over another and creates communities of users on one network. One member will join a network and then bring their whole family over to keep in contact with each other for little to no cost to them.
6. Don’t justify to yourself “I’ll never spend that much anyway”
This point kind of follows on from the look at the call rates point. Looking at the caps at face value does not work. So many people say “I’ll never spend $400 worth of calls anyway”. But they do!!!! Don’t look at it in terms of monetary value. Instead calculate how many calls you can make from the cap limit.
Sales reps will point out how much monetary value you’re getting out of them, but to point out how many calls you can make with that might be another story.
7. Do ask about any specials that maybe included in the plan.
For a period of time Vodafone and Optus were including certain amounts of free browsing of their “Vodafone LIVE!” and “Optus ZOO” respectively when you signed up.
Three also have 50c for 10 minute Three to Three video call Sundays. Although video calls are not included in the cap, if you are already over your cap limit this effectively puts your call rate at 2.5c/30 seconds
8. Don’t ever call or text competition lines if you do not want to pay extra for them.
Competition lines (19/1900) will never be included in your cap. You will always pay extra for them and they are expensive in general.
9. Do find out how to check how far into your cap you are.
This is just because there are so many people who have taken the caps at face value and assume that they will never go over their cap because the limit is so “high” and thus never bother checking how far into their cap they are during the month.
In essence it’s awkward for the sales assistants because it was not our fault but their bill is a lot higher than they first thought. We then show them how to check their cap and then they go on their merry way.
I would just implore you not to get caught out in the first place!
10. Don’t just allow the first sales assistant to close the sale without checking the competitors!!
The most obvious one of the lot, it’s just that some sales reps are really convincing. They believe in their product to no end and can sell a mobile to a Luddite. If you’ve hit one of these and haven’t checked the competitors, don’t just say yes straight away but let them know you’ll think about it. You may find that another company has a cap that works more like you do.
Well that’s it. I like to think of all the cap plans as the glass slipper, there’s always one that will fit better than the rest. Here’s a bit of a glimpse of comparing the four $49 caps I was talking about earlier. The thing to take note of is the “cap limits” of the four being $200, $230, $280 and $230 for Telstra, Optus, Vodafone and Three respectively.
These are all estimates and the yellow signifies the best while the red signifies the close competitors that are within 10% of the best. Each of the rows represents 100% worth of usage in that particular type of call or SMS. So for the first row that means you use the whole cap only on 1 minute calls to other networks. In bold are the most common type of call "the two minute call".
$49 Caps in a nut shell
If you have any questions give me a yell as per usual at mobiletales 064 gmail 046 com.
Next time at mobile tales we look at "What is 3G?"
- Ben
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Comment by Anonymous
Virgin - using Vodafone network no longer has a capped $49 plan. It is now cap $45 and has only $200 worth of calls at same call rates
Comment by MaaUpma
Indus Guru
Vastu - The Indian Science of Dwelling
EGurumantra - Demystifying India
Thanks Ben !
Comment by Anonymous