Taxes included was the hard part, and the whole point.
I led the pricing and packaging workstream for T-Mobile ONE, and the work was less about the plan than about every function that had to change for the price on the ad to be the price on the bill.
Senior Product Manager, Postpaid Subscription ProductShipped work
CONTRACT-ERA PLAN
Line chargesTaxes & feesDevice subsidyOverages
One tax-inclusive price
UnlimitedNo contractTaxes included
KELVIN ZEE
T-MOBILE ONE · 2015 - 2017
01 · THE PROMISE
02 · THE INDUSTRY PLAN
03 · THE DECISION
04 · WHY IT WAS HARD
05 · EIGHT FUNCTIONS
06 · AROUND THE PLAN
07 · WHAT CHANGED
A plan is a promiseabout what a customerwill pay.
SCHEMATIC
The number on the ad smaller,the number on the bill bigger.
Make the pricethe whole price.
UNLIMITED DATANO CONTRACTTAX-INCLUSIVE FROM JANUARY 2017
A price that includes taxis not a marketing change.
Accounting
Legal
Billing
Revenue recognition
SCOPE
8
functions aligned for the tax-inclusive rollout
VALUE PROPOSITIONS
International roamingGogo in-flight connectivityJUMP!
Each one turned a partner economic into something a customer could state in a sentence.
COMPANY RESULT
~75%
of new postpaid accounts activating on ONE by October 2016
851Kbranded postpaid phone net adds in Q3 2016
T-Mobile named ONE as a primary growth driver alongside iPhone 7 and prepaid migrations.
KELVIN ZEE · T-MOBILE ONE
Taxes includedwas the hard part,and the whole point.
Role reel, at your own pace
The promise
A plan is a promise about what a customer will pay.
The industry planSCHEMATIC
The industry plan made the number on the ad smaller and the number on the bill bigger. A device subsidy hid inside the line charge, the advertised price excluded taxes and fees, and overages punished the months customers used more.
The decision
Make the price the whole price: unlimited data, no contract, and from January 2017 a single tax-inclusive price.
Why it was hard
A price that includes tax is not a marketing change. It is an accounting, legal, billing and revenue-recognition change.
Eight functionsSCOPE
8 functions aligned for the tax-inclusive rollout: legal, accounting, finance, care, retail, billing, marketing and customer delivery.
Around the planVALUE PROPOSITIONS
Around the plan sat international roaming, Gogo in-flight connectivity and JUMP!. Each one turned a partner economic into something a customer could state in a sentence.
What changedCOMPANY RESULT
About 75% of new postpaid accounts were activating on ONE by October 2016, and there were 851K branded postpaid phone net adds in Q3 2016. T-Mobile named ONE as a primary growth driver alongside iPhone 7 and prepaid migrations.
The role in 30 seconds, using only facts published on this site.
851Kbranded postpaid phone net adds in Q3 2016
~75%of new postpaid accounts activating on ONE by October 2016
8functions aligned for the tax-inclusive rollout
T-Mobile named ONE as a primary growth driver for the quarter alongside iPhone 7 and prepaid migrations, so these are company results the work contributed to rather than results it produced alone. The net-add and adoption figures are from T-Mobile's published Q3 2016 results and its October 2016 statement.
A plan is a promise about what a customer will pay. For most of the industry that promise was untrue by design. The advertised price excluded taxes and fees, a contract locked the customer in, overages punished the months they used more, and a device subsidy hid inside the line charge. Every one of those made the number on the ad smaller and the number on the bill bigger.
Make the price the whole price
T-Mobile ONE removed them. Unlimited data, no contract, and from January 2017 a single tax-inclusive price. The simplification is easy to describe and it is the describing that made it hard, because a price that includes tax is not a marketing change. It is an accounting, legal, billing and revenue-recognition change.
Align the functions that make a price real
I ran the workstream through the 2016 launch and the January 2017 tax-inclusive rollout. Eight functions had to agree before the price could be stated that way: legal, accounting, finance, care, retail, billing, marketing and customer delivery. Each had a version of the same question, which was what the number meant in their system, and none of them could be resolved by the others.
Around the plan I built the differentiated value propositions: international roaming, Gogo in-flight connectivity and JUMP!. Each one turned a partner economic into something a customer could state in a sentence, which is the same test the price itself had to pass.
What changed
T-Mobile reported 851K branded postpaid phone net adds in Q3 2016 with positive sequential ARPU, and named ONE as a primary growth driver alongside iPhone 7 and prepaid migrations. By October 2016 roughly 75 percent of new postpaid accounts were activating on ONE and about a quarter of the account base had moved to it.
The transferable lesson is that packaging simplicity is won in the systems that produce the bill, not in the description of the plan. Anyone can advertise a simpler price. Only the functions that calculate it can make it true.
FROM THE LAUNCH / 2016
The plan on one page, taxes still outside it.
The August 2016 launch fact sheet is T-Mobile ONE in full: unlimited talk, text and 4G LTE, a pricing ladder that falls per line as lines are added, and the Un-carrier benefits attached to it, including Simple Global, Mobile Without Borders and an hour of Gogo in-flight.
Look at the line under the price. Plus taxes and fees. That clause is what the January 2017 rollout removed, and removing it is what took eight functions, because a price is only tax-inclusive once billing, accounting, finance and legal all calculate it that way.
T-Mobile ONE launch materials, 2016. Brand and design are T-Mobile's.
