Virgin Mobile Offers 'Pink Slip Protection' for Mobile Users

Virgin Mobile will be offering "Pink Slip Protection" to mobile phone users who have been customers for at least two months: Lose your job, prove you're eligible for unemployment benefits and three months' of calling is on Virgin Mobile. It seems to be working for Hyundai-can it work for the in-your-face MVNO?

Trying economic times call for creative marketing measures.
On April 15, Virgin Mobile will unveil a new unlimited prepaid calling plan available with "Pink Slip Protection," which will waive up to three months' of calling charges if the customer becomes unemployed.
Pink Slip Protection is available with Virgin Mobile's $49.99 Totally Unlimited plan, its Texter's Delight program-also being introduced April 15-and other Virgin Mobile USA monthly plans without annual contracts may qualify.
"With the unemployment rate rising, the fear of job loss or salary reductions have made consumers watch every dollar," said Dan Schulman, CEO of Virgin Mobile, in a statement announcing the program.
Salary issues, Schulman said, tend to impact Virgin Mobile's prepaid base more than its other customers.
In order for Pink Slip Protection to kick in, one must be a Virgin Mobile customer for at least two months on a monthly plan. In the event of a job loss, Virgin Mobile will cover the cost of the monthly plan, including taxes and surcharges for up to three months, provided the customer can show proof of eligibility for state unemployment benefits.
While it may be creative marketing, it's hardly untested. The automotive industry has also had luck with programs that alleviate customers of their "what if" fears.
F.I. Magazine reported that after Hyundai offered an Assurance Program, CNW Research surveyed consumers shopping for a vehicle in Hyundai's market segment and found that more than 50 percent of what it calls "intenders" hadn't considered buying a Hyundai before learning about the Assurance Program, which states that if, within a year of financing or leasing a car, a customer loses his or her income, the vehicle can be returned.
Could Virgin Mobile see a similar response?
"In general, people are very loyal [to their mobile carriers]," says John Spooner, an analyst with Technology Business Research. "There's a momentum effect. There needs to be something really enticing to get them to change-an iPhone, or something."
A protection plan is "certainly a nice thing to have," says Spooner, "but I don't think it'll be the only factor in deciding to go with that carrier. You kind of add it all up: Do I know anyone who says it's a good carrier? Do I like the plan?"
Overall, Spooner felt the offer was in keeping with Virgin's in-your-face style of marketing. "It's not typical, but it works. It'll get them some attention."
In March, the Centers for Disease Control and Prevention reported that, in a cost-saving measure, more Americans were getting rid of land lines and using only their cell phones, and Opinion Research found that Americans were cutting back on cell phone spending-a move it believed would benefit carriers offering prepaid spending plans.