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Carphone Warehouse has defended its cashback deals in light of greater scrutiny on cashback promotions from Ofcom and bad publicity surrounding cashback.
CEO Charles Dunstone said: 'Cashback deals are a reflection of the aggression people have to get new connections. Subsidies are now significantly higher than the cost of the phones and the margins people are looking to make, so the residuals are given away as cashback.'
Several thousand customers were left with unpaid cashbacks after Dialamobile and Mobile Media Systems collapsed last year. 'Although Ofcom is looking at it, it is an issue for customers who have bought from very small outlets, and been promised cashbacks and the companies have gone bankrupt. It's an issue of fraud of people setting up a business, promising cashbacks and then collapsing the business rather than coming from networks or reputable businesses like ourselves.'
Dunstone added: 'Cashback will continue because that's the way the market is. If it was to stop we would make a lot more money, but I can't see that happening.' |
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Q. I have an issue with Cashback
A. If you have not been paid your cashback or the dealer is making life difficult to claim, then we are advising that you should in the first instance after you have contacted the dealer concerned, inform Ofcom the regulator, and also Trading Standards who will log your complaint.
Because of the number of cashback problems we are not able to deal with the many thousands of enquiries. The IMPDA is pushing for change in their area, and has already had meetings with Ofcom the industry regulator, and is also meeting Members of Parliament. The networks as well are doing what they can to reduce the bad cashback dealers.
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I have a problem with a Dealer |
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Q. I have a problem with with my dealer
A. If this is to do with the purchase of a mobile, then you should contact the dealer first to try to sort things out, you could also contact the Manager or Director of the company to inform them of the problem. In many cases talking to higher management can resolve the issue.
If you have have a problem with rudeness or an unwillingness to do anything then you can write to us giving full details and we wil write to them for you.
If you unable to resolve your problem, then you may wish to take it to one of the bodies set up to help, such as Trading Standards, Consumer Direct or Ofcom.
Always try to resolve the issue with the dealer first and ensure that you put everything in writing so you have a record. The dealer will do all they can to resolve issues, but in many cases this can come down to a mistake by the customer, or where the customer has not understood even if this was clearly explained at the time.
If the problem lies with an order placed online i.e. through a distance sale, then talk to the dealer, and if you were told that the conversation was being recorded then ask for the recording to be played back to you. In many cases this resolves the issues especially if you have agreed to an order or some details of the order but forgotton it later.
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PARLIAMENT SUPPORTS IMPDA |
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It has been announced today, that an Early Day Motion has been put forward by MP's at the House of Commons with regard to cashback. The Early Day Motion applaudes the IMPDA and supports the IMPDA in its call to Ofcom. The full text of the motion before parliament is as follows. INDEPENDENT MOBILE PHONE DEALERS ASSOCIATION, OFCOM AND CASHBACK 15.01.2008 Godsiff, Roger That this House welcomes the first meeting to take place between the Independent Mobile Phone Dealers Association (IMPDA) and Ofcom, the telecoms regulator; regards the opportunity presented to the IMPDA to give its views on the working relationship between dealers and the network providers and consumer issues, particularly in regard to the ongoing problems associated with cashback which have left many customers facing legal action, as long overdue; agrees with the IMPDA that the consumer has been ill served by the failure of the network providers to adequately police the cashback incentive scheme; believes the network providers to be complicit in the active promotion of an unsustainable business model in relation to cashback to achieve connection numbers and highly profitable volume targets; further believes the voluntary arrangement agreed between Ofcom and the network providers has comprehensively been demonstrated to be inadequate; and supports the IMPDA in its call to Ofcom, following its current review, to introduce statutory regulation not only to protect the consumer but also to eliminate uncompetitive practices within the industry. |
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The IMPDA podcast is produced monthly, and has stories, News and Happenings from around the dealer network. We also have interviews with invited guests, and in this months interview with Paul Marks will be Bob Sweetlove from Hugh Symons Communications, winner of the IMPDA 2007 Best Distributor Award. Bob will be taking about the decision to cease trading with Distance sellers, Hugh Symons and what they can offer dealers, and the future for the industry. In the future we hope to have interviews with other distributors, Manufacturers, and Networks. We are always open to comments or suggestions, so if you have a comment or would like to give us a story (we may even contact you for an interview) then email us at contact (at) impda.co.uk |
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The hype on the iphone and the decision of O2 to continue to bar their own authorised dealers to sell this especially on the run up to Christmas is disgraceful and shows how little O2 values its dealers, it would have made more sales, if they has allowed them to sell from day 1. Why have they got to wait, start this week and tell all your dealers they can sell it now. O2 had plenty of time to sort out a business tariff prior to launch, they have known about the iphone for some time, but they have failed to have anything in place. In all O2 have done themselves no favours with lack of planning and a poor launch with only CPW again selling it. Businesses are eager to buy and what’s O2’s suggestion, get a consumer tariff and they will help to port numbers. What a way to treat buyers. We had thought 3 had been bad in the past to its dealers on the run up to Christmas but O2 takes the award of the bent bucket for the treatment of its dealers and failing to provide business tariffs, lack of planning and forethought. The past year for dealers has not been good and most dealers have been frustrated by the network only deals especially on the run up to Christmas. Cashback has put some companies to the wall, and distributors have been picking up the pieces, whilst those dealers still in operation have been finding it tough going. 3 network came out with a brilliant set of Mix and Match plans to challenge T-Mobile and was widely welcomed by dealers. The IMPDA is growing all the time, and Ofcom and MP’s are talking to dealers for the very first time, so there was some light in the dealer tunnel. We still have not seen POS material for December from 3 and I have a feeling that again just before January it will turn up, again poor planning. No statement still on letting their authorised dealers start selling the iPhone now, what poor support that is, again the small dealer gets left out whilst the large CPW is left to sell, if that’s not one sided, then I don’t know what is. If as its been reported in Mobile today that T_Mobile are putting off dealers from connecting new connections and upgrades until January, then this is going to be a poor Christmas period for dealers. Dealers need to have support both from the distributors and networks, and need something to enhance sales this Christmas, so far not a lot, so we can only ask if they can come up with something which will help dealers in what should be the busiest time of the year. The IMPDA are planning to do podcasts on the site soon, so we will have discussions, interviews, and news affecting the industry. Paul Marks with his extensive experience in Hospital radio will be part of the new podcast team so we hope everyone will enjoy the experience. |
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Message from the Chairman IMPDA
On behalf of the IMPDA and its team I would like to wish all UK dealers/distributors/networks a very Happy New Year 2009.
We wish all dealers good luck for 2009 and that their business continues to survive in 2009 after what has been a very difficult last quarter of 2008. Dealers this year need all the help they can get, and we hope that Mobile Network Operators will help to keep the independent dealer alive and well in 2009 and maybe offer special deals which will help to bring more business to the independent sector.
The future for dealers this year may be more difficult due to the economic climate, however dealers are tough and many will survive this difficult time. Despite the gloom, consumers are using their mobiles more and more, and although their may be a slight downturn, it;' not as bad as some sectors. That does not mean that dealers can be complacent. If anything diversification is the word this year, with more dealers taking on additional products to sell, and not just mobiles. Suppliers can also help dealers achieve additional sales, If suppliers would like to help UK dealers then please contact us to discuss.
Happy New Year to you all
Chris Caudle
Chairman IMPDA
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