Ausdroid Exclusive: Virgin Mobile pulling out of third-party retail stores, focusing on their in-store experience

Ausdroid Exclusive Virgin Mobile have confirmed to Ausdroid that they are changing their focus in Australia, but they are not pulling out from the Australian market. Quite the contrary.

How did this start?

Overnight we received an interesting rumour via our anonymous tip facility. Some of these tips have been — in the past — a bit questionable, and when we saw this one, well we thought it was of the same elk. I mean really, a rumour that Virgin Mobile were pulling out of the Australian market?

We had to check this for ourselves. So off to the local Kmart we went to investigate.

To our surprise, we found that there was no Virgin Mobile point-of-sale material to be seen. No brochures, no plan comparison tables, nothing. In the locked cabinets where handsets and SIM cards are sold, there was Optus, Vodafone, and a few minor carriers’ material, but nothing at all for Virgin. Could it be true?

I spoke to the shop assistant in the Entertainment section, where mobile telephony stuff lives, and asked the question. Where was all the Virgin Mobile stuff?

Well, it seems our tip is correct. Virgin Mobile products, including handsets and SIM cards, are no longer sold in Kmart, and not just our local one, but all of them. It’s gone. I was told that handsets have been gone for a little while now, but as of yesterday (5 April) all remaining products have been removed from sale as well.

This seemed just a little strange, so I thought I’d check the other Coles Myer properties nearby — Target and Coles — and maybe the local Virgin Mobile store. It seems this rumour might be restricted to Kmart only; both Coles and Target had various Virgin Mobile options available for purchase — SIM cards, and some cheap prepaid handsets. Nothing remarkable. Staff in both stores knew nothing of any pull-out by Virgin Mobile.

As for the Virgin Mobile shop? It was as open as it has ever been. A couple of staff were in attendance, and everything appeared to be normal. There weren’t many customers, just a couple of kids, but that’s not unusual considering it was fairly early on a Saturday morning.

What’s the official word?

The rumour about Kmart was right; Virgin Mobile’s Melissa Gompes has confirmed with Ausdroid this afternoon that besides mobile recharges, Virgin Mobile handsets and SIM starter kits will not be available in Kmart.

Further, the same changes will soon be happening at other retail channels, including Coles, Target, Dick Smith, Tele Choice, All Phones, and basically any other retailer of Virgin Mobile products and services.

Virgin Mobile have told Ausdroid that this is to bring the focus on Virgin’s own retail stores — all 74 of them — around the country. Virgin Mobile have also told us that, despite the leaked internal memo from Kmart, they are not pulling out of Australia at all; Virgin Mobile claims to be number 1 in customer satisfaction and has market-leading churn rates — there’s no way they’d leave the Australian market at the moment.

Knock on effects?

Already Virgin Mobile’s products are starting to disappear from store shelves. I’d imagine it won’t be long before stock on hand disappears from third party retailers, leaving just the option to recharge Virgin Mobile accounts through those outlets.

Ausdroid’s Daniel Tyson has been running around this morning and has confirmed this move with TeleChoice, confirming that they’ll no longer be selling Virgin Mobile services, instead they’ll be changing their offerings over to Telstra. This change is already underway; TeleChoice has internally commenced the changeover in the last week.

AllPhones are still advertising and offering Virgin Mobile products and services for sale, however our source has told us that Optus / Virgin have ‘threatened’ a number of times in the past to claw-in their mobile business. It looks like those threats have now become reality.

What does it mean for you?

If you’re a Virgin Mobile customer, chances are it doesn’t mean anything much. You should soon be able to have a much improved in-store experience (in line with Optus’ in-store improvements which we’ve previously covered). You will still be able to by recharge vouchers for pre-paid services from all the usual outlets, and Virgin Mobile was quick to remind us that you can do this online and via your handset as well, so there’s no changes there.

All in all, it’s just another change in Australia’s dynamic telco environment. Not entirely unexpected, but nonetheless, a bit of a shakeup, particularly for the third party retailers who will be losing a chunk of their business.