Given the changes afoot at Boost Mobile, it’s no wonder some might be curious about Boost’s retail strategy going forward. Some have even said it’s akin to a flea market.
Boost has been around since the early days of MVNOs in the U.S., initially affiliated with Nextel Communications and later coming under the ownership of Sprint. Today, it’s under the stewardship of Dish Network, thanks to a rather novel approach by the U.S. government when it conditionally approved the Sprint/T-Mobile merger.
Since Dish Network took over Boost ownership about a year ago – and remember, Dish didn’t have a mobile retail presence until then – Boost has been operating as an MVNO using T-Mobile’s network. Lately, its relationship with T-Mobile has been the center of attention, as Dish co-founder and Chairman Charlie Ergen famously referred to T-Mobile CEO Mike Sievert as the “magenta Grinch".
Flea market analogy
Jeff Moore, principal of Wave7 Research, previously made the analogy between Boost and flea markets when he tweeted about various services being offered in some stores: sports gambling, telehealth, Sling service. “For better or worse, Boost stores are becoming flea markets,” he said.
Questioned about that statement more recently, Moore presented a list of all the things that led to that conclusion.
Some dealers sell the Vigo brand of international payments. In fact, dealers in California have told Wave7 they wouldn’t be able to stay in business if it weren’t for the ability to offer those payment services. Some Boost dealers also keep unlocked phones on hand; typically, carriers only unlock phones if they’re intended for their own network. Sling is offered in at least four trial markets. Some stores, where the Comcast footprint allows, offer Xfinity internet services.
RELATED: Dish’s new EVP of Boost looks forward to shaking up prepaid
The list includes other items, including the recently added telehealth services added this summer and sports entertainment.
“This is all occurring in the aftermath of Dish Network taking over Boost stores. They’re giving their dealers a lot of autonomy,” Moore told Fierce, noting that some of the add-on services started in 2018, before Dish took over.
In addition, “phone repair is a big thing” for some dealers. It’s not clear how widespread that is, but there are signs in windows about offers of phone repair, and for those dealers who offer it, it’s very important to them, he said.
According to Wave7, some good news for Boost stores is their numbers haven’t gone down that much compared to pre-pandemic days. They’re finding additional sources of revenue, and that’s a positive. “I think Dish Network is telling the dealers, ‘do what you’ve got to do to survive,’” Moore said.
While dealer autonomy might be a nice benefit, it’s not exactly the main motivation, according to Boost EVP Stephen Stokols, founder and former CEO of FreedomPop, who joined Dish last fall.
It’s more about pursuing a wholistic strategy where customers’ needs are met in one place – and Boost customer demographics show, for one thing, a big need for medical services. Many of them are “vastly under-insured,” and having access to medical staff for themselves or a family member is a big deal.
“We’re trying to have broader appeal,” Stokols told Fierce. “We want to bring people in” and increase traffic in stores.
As for looking like a “flea market,” Stokols said he can kind of see where that perception comes from, especially in the early days of the strategy, but the services in the stores are digital – so it’s not as if they’re taking up shelf space – and they offer ways to go beyond the usual voice, text and data that so many other retailers offer. Among the U.S. carriers, everybody claims the best or fastest 5G, and “we’re trying to cut through a lot of that noise,” he said. “We’re trying to actually differentiate.”
He hinted at but gave no details about coming attractions, like in the area of financial services. It already addresses sports entertainment, of which the DraftKings is just the beginning.
“There are other propositions coming that will be as compelling,” he said, and for customers, it’s about getting services beyond voice, text and data that will bring them value.
Another acquisition in the works
Another acquisition is expected relatively soon, but he wouldn’t elaborate on the nature of that, except to say that there are “a lot of" smaller MVNOs out there.
Dish already oversees multiple brands. It recently bought Republic Wireless, last year it acquired Ting Mobile and “there’s likely to be another acquisition” in coming weeks but nothing that they’re ready to talk about now, Stokols said.
“The idea is to take a Boost store and actually make it more like a retail experience with a wholistic experience,” with a lot of new stores equipped to sell multiple connectivity products, he said.
“We’re trying to take Boost up market to some extent. We don’t want to look like a Cricket store or a Metro store. We want to look like you can come in there and you can get different services,” he said. Not every store is upgraded, but “that’s the approach.”
In the same sense that T-Mobile took on extra costs when it started offering “Netflix on Us,” Boost is willing to incur the cost of the medical service, for example, for the prospects of customer satisfaction, retention and acquisition.
Some poor performing stores have closed and new ones have opened up but net/net, it’s relatively flat, so Boost hasn’t closed a boatload of stores, as one might have presumed when new ownership took over.
One of the big questions is to what extent Boost stores will end up selling Dish postpaid wireless services when the time comes. Dish is currently building out its own 5G network.
Wave7’s Moore said postpaid and prepaid stores tend to serve different clientele. “There are reasons why we have prepaid stores and postpaid stores,” he said, noting that Boost stores are not generally located in areas where postpaid sales would make a lot of sense. “That being said, I would never say there’s zero overlap.”
Will Boost stores eventually will sell Dish postpaid wireless services? The answer appears to be yes, as Stokols said stores are being set up to sell multiple brands.
As for the impending T-Mobile CDMA network shutdown that, according to Dish, threatens to hurt Boost customers, he would only say that conversations with regulators are ongoing.