Consumer Cellular notches 2.5M users, predicts $1B in revenue next year

Smartphone
Consumer Cellular is thriving in a brutal MVNO market by targeting older users.

The MVNO market in the U.S. is rife with casualties, but Consumer Cellular continues to pick up momentum.

The Portland, Oregon-based company recently notched its 2.5 millionth customer, as the Bend Bulletin reported this morning, and expects to generate $1 billion in revenue next year. The company confirmed those figures to FierceWireless.

While most MVNOs don’t release customer numbers, Consumer Cellular appears to be the second-largest such service provider in the nation behind America Movil’s TracFone. And while TracFone’s growth in the U.S. may have peaked, Consumer Cellular has seen impressive—if not entirely consistent—growth in recent years.

The 22-year-old company, which provides service using the networks of AT&T and T-Mobile, posted 30% growth in 2014 and roughly half that increase last year, the Bulletin reported.

The history of MVNOs in the U.S. is strewn with failed businesses, from high-profile brands such as Disney Mobile and Mobile ESPN in the early days of the market to smaller efforts such as For Defense Mobile and Scratch Wireless. Perhaps most recently, RingPlus was shuttered after it failed to make a go of free, ad-supported calling plans.

Providing services to niche markets has become a key strategy for MVNOs, and as Consumer Cellular evolved it began targeting users 50 years old and older. Roughly 10 years ago, the company inked a revenue-sharing partnership agreement with AARP that essentially allows the company to advertise to AARP members (Consumer Cellular materials are included in AARP’s new-member welcome packet). The company’s services and devices are also available in Sears and Target, as well as through the Consumer Cellular phone service and website.

As Consumer Cellular narrowed its focus on the 50-plus market, the company worked to make its services as simple as possible to use. For example, it works with Swedish phone maker Doro to build custom feature phones—and more recently an Android smartphone—designed to be easy to use for the elderly.

But the primary element of Consumer Cellular’s business strategy in targeting its chosen niche is its customer service operation.

“Absolutely the time that our customers spend with our call centers is longer than other call centers, but in some ways that has also worked to our benefit because we’re willing to devote that time to helping our customers,” CEO John Marick told FierceWireless last year. “So maybe you’ve tried another carrier and you had a bad experience or you didn’t get through to a call center. But we’ve got our number on everything, we’re more than happy to talk to you and do whatever it takes to make you comfortable.”