Rogers CEO dismisses analyst’s concerns about loss of customers due to price hike

(Aanchal Nigam / Red Maple)


Image Source: @Rogers/Twitter

Rogers Communications’ Chief Executive Officer dismissed the concerns of the analyst about losing customers due to price hike. Instead, Rogers CEO Tony Staffieri said the company was focused on its premium brand where performance was stronger.

According to Canadian Press report, during Rogers Communications Inc.'s fourth-quarter earnings call, CEO Tony Staffieri addressed concerns about the loss of customers, particularly among its discount brand segments like Fido, to rival carriers due to competitive pricing strategies. Staffieri observed an increase in what he described as promotional activity in the market's lower end towards the last quarter of the year, which led to a shift of some phone customers towards competitors offering more attractive deals.

The company noted an uptick in its monthly churn rate for net postpaid mobile phone subscribers, a key metric for tracking service cancellations, to 1.67 percent from 1.24 percent in the previous year's fourth quarter. Despite this rise, Staffieri remained confident, emphasizing the company's strategic focus on premium segments over discount offerings. He highlighted that Rogers experienced a significant year-on-year increase in new subscriptions, primarily under the Rogers brand, which constitutes the bulk of their customer base.

Rogers reported a net increase of 184,000 postpaid mobile phone subscribers for the quarter, a slight decrease from the 193,000 additions in the same period the previous year. This growth was attributed to effective sales strategies in an expanding Canadian market. Staffieri pointed out that the churn rate for Rogers mobile brand customers is notably lower than that for Fido, suggesting a stronger retention of customers within their premium segment.

Addressing the recent price increases, Staffieri sidestepped direct questions about the potential impact on future churn rates. Instead, he remarked on the diminishing promotional activities in the early part of 2024, hinting at a stabilization in the market's competitive dynamics.

Furthermore, Staffieri noted Rogers' success in attracting newcomers to Canada, such as foreign students and temporary workers. He acknowledged the transient nature of this demographic, which could lead to fluctuations in subscription numbers, yet maintained a positive outlook on the company's ability to attract and retain customers in this segment.

Overall, despite the concerns raised by analysts regarding customer loss due to price hikes, Staffieri's comments reflect a strategic focus on premium services and confidence in the company's market position and customer retention strategies.