Where Have All of The Prepaid Customers Gone?

Going, Going, Gone!

So many in the prepaid calling card business have been suffering through declining sales as the customer base continues to move towards other sources for making long distance phone calls. We know that many continue to use calling cards because of their convenience and savings, but where are all of the rest going to make their calls?

Calling Card Demographics

As far as I can tell, phone card customers are mostly immigrants and are generally credit challenged. They naturally prefer cash transactions as that is what they grew comfortable within their home country. Credit card availability is also less common elsewhere than in the United States.

What Has Changed?

In recent years, the credit card companies have started to cater to the immigrant population more than ever before, especially in the Hispanic market. As a result more and more immigrants are getting credit cards than ever before. Also with prepaid credit cards getting a bigger push than ever before, many who would have never had the credit status to qualify for a post paid credit card are now able to join the ranks of the credit enabled.

What This Means?

What this means is that many of these former prepaid phone card customers are now able to choose from a variety of other services that have been unavailable to them before: Mobile phones, Prepaid Cellular, Voip and traditional long distance as well.

These other companies have also been making a cognitive push towards the ethnic markets by lowering their LD rates to levels commonly reserved by the phonecard industry. Some, like Skype, have taken it a step further by offering free long distance. It's hard to compete with free so what can you do?

Look Ahead

Diversify, diversify, diversify is the answer! Unfortunately their is no one easy answer as to what to do and the answers will differ by each businesses strengths and weaknesses. Some things to consider: Prepaid Mobile (lower margins but a growing business), Voip services, Internet Affiliate programs and so much more... just put your thinking cap on and give it a try!