As a generalization, Sprint has categorized their prepaid users into three different classes: those who will always go for prepaid, those with credit problems, and those who are still young and hope to establish a credit history of their own. It is, however, important to note that the network has tightened its credit policies for postpaid users in the past 15 months. So how do they plan on lowering their churn rate? It's quite simple. Sprint hopes to lure in the right prepaid users to a more lucrative postpaid plan by giving them customized offerings.
Sprint hopes to go about with this strategy in a scientific manner. Instead of offering random programs for their customers, the company plans to take a look at each customer and upsell a program specific to his behavior. And over time, they can build a billing relationship with Sprint to continue using the program. This also works in Sprint's favor as it turns into an opportunity for them to upsell their customers into their new products and services. So it's a Win-Win situation for everyone.
While this definitely won't happen overnight or in just one quarter, Sprint knows that it's a much needed strategy; especially in a market wherein there is already a decline in smartphone growth and fewer postpaid users. To address this specifically, Sprint has to develop a long-term strategy on how they can capture a saturated market.
And as Sprint hopes to turn its finances around, its executives know they have to focus on their strategy for 2016; which is to reduce costs. This means they will be letting go of things that no longer make sense for this priority. Last Friday, a report on The Kansas City Star depicts that the carrier has already started letting go of employees in an effort to cut $2.5 billion from its budget. Sprint has not given further detail about the job cuts, unfortunately.