Ontela Picdeck a

Topics: Mobile phone, Bluetooth, Multimedia Messaging Service Pages: 8 (2201 words) Published: September 9, 2013
KEL450

MOHANBIR SAWHNEY

Ontela PicDeck (A):
Customer Segmentation, Targeting, and Positioning
In April 2008 Joe Levy, the director of carrier marketing for the technology start-up Ontela, was considering how to position the company’s first offering, PicDeck. Ontela’s PicDeck was a technology service that allowed wireless subscribers to seamlessly transfer pictures from their mobile devices to their computers, email inbox, and other networking devices and services (see Exhibit 1). The service had been well received in the media. An article in Telephony magazine lauded the service as “helping bridge the gap between phone and PC.”1 Ontela’s technology offered value to end users (wireless subscribers) by providing a more convenient mobile imaging experience. This in turn was expected to increase sales of highmargin data services for Ontela’s wireless carriers, its direct customers. By encouraging consumers to transfer pictures from their mobile devices, this new service was expected to increase consumer use of wireless carrier services. Ontela sold its technology to wireless carriers, who were responsible for branding and pricing the service and marketing it to wireless subscribers. These subscribers paid a monthly fee to carriers for the PicDeck service, and Ontela received a portion of this subscription revenue. To develop a compelling positioning strategy for the PicDeck service, Levy needed to identify target segments within the wireless customer base. He faced several major questions: What was the best way to determine the appropriate target audience? Which segment(s) would provide the biggest opportunity for both Ontela and the carriers? How could he balance the needs of subscribers with the carrier’s goals of decreasing churn and increasing average revenue per user (ARPU)? As Levy thought about these questions, he knew that his company’s future depended on his ability to answer them.

1

Sarah Reedy, “Say ‘Cheese’ and Send,” Telephony Online, April 14, 2008, http://telephonyonline.com/wireless/news/ telecom_future_seen_technology_118.

©2009 by the Kellogg School of Management, Northwestern University. This case was prepared by Patrick Dupree, Christine Hsu, Ryan Metzger, Fuminari Obuchi, Arun Sundaram, and Kari Wilson under the supervision of Professor Mohanbir Sawhney. It was revised by Professor Kent Grayson. Cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. To order copies or request permission to reproduce materials, call 800-545-7685 (or 617-783-7600 outside the United States or Canada) or e-mail custserv@hbsp.harvard.edu. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of the Kellogg School of Management.

ONTELA PICDECK (A)

KEL450

Background: Mobile Services and Media Convergence
Mobile Phone Services
The U.S. mobile phone service industry earned $150 billion in revenues in 2007, making it one of the largest sectors of the U.S. economy. Within this market, the data services segment— which included Internet data plans, text messaging, picture messaging, and other multimedia transfers—had grown exponentially. With the continued growth in data revenue, voice revenues were expected to decrease as a percentage of total ARPU. Therefore, wireless carriers would be increasingly dependent on unique and high-value data services for profits and competitive differentiation.2

Camera Phones and Media Convergence
The concept of the camera phone was developed by Daniel A. Henderson in 1993 under the name “Intellect.”3 Since its inception, cameras had become a ubiquitous feature on cellphones worldwide. Advancements included increased megapixel capability as well as video capability....
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