Broadband pricing: how to make it simple?

I originally thought that this platform would streamline the broadband switching process? A bit like look after you bills but with broadband?

I have to say, this thread is fascinating. I love how you guys have opened up this process of how you are planning to operate and discussing it with us (your future customers in a lot of cases).

What’s apparent in the above comments is that you really are in a commoditised market where speed and price are the key differentiators between companies. I would highly recommend you guys read 7 Powers by H.W. Helmer and think about counter-positioning Cuckoo.

Why? You don’t have the scale to be competitive on the lower bands of pricing and you cannot stand out with your current positioning that you’re offering better customer service and shorter contracts. To a lot of people, signing up for longer contract periods only is front of mind when there are actually is a problem in the service by which time it is too late.

At the time when your prospects are considering who their new broadband provider will be because their current one was sh**, they are back to focusing on price because they cannot differentiate between good customer service or good connections at the time of picking a provider. You’re offering a 1month rolling contract but unless it’s a pinpoint at the time when the customer is signing up, I don’t think you’ll have a lot of people flying for that sign up.

In response to your £60 upfront fee question, I would hate to have to pay that. Could you spread it out over the initial 12 months and claw back the cost if someone cancels ahead of having paid off the cost of the router?

The way I think you’ll have to differentiate yourselves is by doing something that the other companies are not doing. Here are few starters:

  • Offering something that has a non-monetary value as a ‘feel good benefit’. You’ll have to find something that resonates with your brand but people still use ecosia because they are helping plant trees (despite it being a bing white label and inferior to Google).
  • Same day installation? Is this a massive pain point? It might be that you depend on the network providers who cannot offer that.
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Thanks a bunch @Chris. That book actually holds up my screen!

I agree with everything you’ve said. We’ve come up with some options today that we’re going to model out, test via market research polling and get your feedback on this thread here.

The issue with clawing back the £60 if someone leaves is that it then effectively becomes a long term contract :thinking:

We have a plan on the non-monetary benefit.

Speed of installation is also something we’re looking at (potentially getting the complete switch process down from avg 14-21 days to 1-2 days). Would a next day switch be enough for you?

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Ah excellent. It’s a great book!

I’m relatively organised and don’t mind planning up to three weeks in advance as I set myself reminders well ahead of my contracts expiring. So I wouldn’t be your target market for the short switch time.

Personally, 12month contract is fine and the price needs to be relatively competitive. Speed is relatively unimportant as I don’t stream loads and don’t play games over the internet. Good customer service would be a differentiating factor to some extent because I’ve had a terrible experience with my current provider’s service (37 days without internet) in the last couple of months.

Hi all - thanks so much for your comments on pricing so far. So valuable to help us get real insights from potential customers.

We’re also running an online survey this week that tests different pricing options - we will share the findings on this channel and pitch our updated proposal!

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Thought this was interesting @James. Though you’ll shoot me in the hunt for margin :eyes:

Hi everyone. Thanks so much for the feedback you’ve been giving us on pricing. We took it all away, did some thinking, surveying and modelling, and then wrote a blog outlining what our strategy would be. You can read it here!

Goes without saying that this is an ongoing conversation with all of you. We think this is the most sensible approach to pricing, but are happy to be persuaded otherwise! So comments are very much welcome.

And any sharing of the blog on social media is very much appreciated, as we look to get our name out in the open…

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Hi! Sorry to necro this thread but I just wanted to say firstly that I came from your Instagram advert but more importantly:

I think your pricing is very well aligned compared to new customer offerings. I recently renewed my BT broadband and they are only offering 24 month contacts for new and existing customers which is rubbish. I don’t want to be locked in with their pricing for 2 years. I got a stipulation on the contract because I’m not planning to live in the UK for that much longer.

£30 for what basically sounds like Infinity 2 without a contract sounds great to me. I also don’t use my landline (don’t have a phone installed) and I need unlimited data. That speed is great for downloading games etc.

I understand the power of having one key offering like Bulb. But I think it’s important to understand that there is a market of people who can’t get those speeds and it would be fair to offer a cheaper package for them (and old people who just look at Facebook and email their grandsons) at 30 mbs.

I’m excited to see where Cuckoo goes, even if I probably won’t be able to join. I have comments about the referral scheme but I don’t think that’s on topic for this thread.

Thanks Dylan. Instagram seems to be working!

On product choice thats a fair challenge. We’re probably going to stick with just one deal and one price this year but once we get bigger we can then test and adjust. ideally we’d provide the speeds and reliability you actually need by there are only so many problems we can fix all at one time!

And on the referral scheme, do share them on the referral thread.

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Hi @dyl - thanks for your comment on pricing. Good to hear you think it sounds reasonable. Interested in your views on our £60 join fee. Do you think that’s a turn off for many people? More details in our blog.

James

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I understand how the £60 can be a barrier but I like the flexibility of offering Klarna. I think it encourages people to stay for a couple of months to make it “worth it”. As long as the fee is transparent I don’t think it’s too bad.

You could make it more of a deposit type thing where you “earn” it back after x number of months, if that makes sense?

Excited to see what the future holds for Cuckoo!!

Thanks for the feedback! Yep Klarna does help. And we’re definitely weighing up the idea of allowing people to earn it back. Great way of rewarding customer loyalty - the opposite of what the industry typically does.

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Seriously though, who wants to be locked in a 24 month contract??

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You tell me!

(Although if you did choose to stay with us for 24 months then obviously we’d love it)

THere’s a market for reasonable cost, good quality broadband, look at AAISP/IDNET etc, so assuming its good quality price should not be an issue in my mind.

Providers like NOW TV etc do provide a similar offer with regards to short contracts (But also have the £60 connection charge), however they only offer “switching” from an existing line, rather new connections.

Thanks. Yh if you think about it there’s nothing groundbreaking in our offer other than the simplicity. Basically like the opposite of Amazon. They want to sell everything SKU imaginable. We only have 1. Hopefully it works :slight_smile:

What’s the relative difference in wholesale pricing for different down/up speed options?

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Hi @jph - it varies by wholesaler, and in any case I’m afraid that’s a little bit too commercially-sensitive for us to put on the forum!

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That’s why I only asked for relative figures. Can you say anything about the different options available? Even qualitative pricing differences would be helpful.

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