The In-Store Phone Trade-In Has Evolved—So Must Carriers & Retailers

To win the hearts, minds, and wallets of consumers, mobile retailers and carriers must prioritize the in-store phone trade-in as an experience. If you want to make stores more appealing for trade-in consumers, you must give employees fast, accurate diagnostics and grading solutions. The right tools take pressure off time-crunched staff and automate the delivery of complex grading capabilities that don’t undercut the true market value of handsets.

This article tracks how phone diagnostics and grading solutions have evolved to support your mobile retail or carrier business.

Kon Maragelis With 30 years of experience in senior leadership roles in the telecommunications and mobile reverse logistics industry, Blancco’s Head of Mobility Product Marketing and Sales Success, Kon Maragelis, ensures that Blancco’s mobile solutions lead the industry. Drawing on his decades in the sector, Kon is recognized for his thought leadership and innovative solutions design, leveraging benchmarked reverse solutions and patented process flows. He speaks regularly at global conferences and supports carriers, retailers, and mobile lifecycle businesses to optimize their mobile processes and systems.

Summary

• Despite the growth of consumer self-service, phone trade-ins and related services still often require in-store interactions. 

• Yet, without effective in-store resources, mobile companies risk accepting incorrectly and inexpertly graded devices, lowering customer satisfaction and potential profits.  

• Apple’s Genius Bar and remote diagnostics apps partially met this challenge, but accurate and consistent mobile trade-in evaluations remained out of reach 

• Until recently, full mobile grading and diagnostics were not possible in stores. But new tools are changing the game for mobile retailers and telcos.

For in-store phone trade-ins, customer service is still essential

Businesses and consumers have grown to love self-service shopping. 

From online ordering to chatbots, many experiences are now totally self-driven. And the data suggests that many consumers prefer to steer their own course. 

Just over 20% of retail purchases are expected to take place online in 2024, with that number projected to grow to 23% by 2027. What’s more, 67% of respondents in one survey said they prefer self-service over speaking to a company representative. 

As important as self-service strategy is, it is only part of the story. Nearly 60% of consumers say they cannot resolve their issues on the web. Approximately half still contact live agents. 

For your mobile business too, consumer self-service can be a double-edged sword. 

Inexpertly and incorrectly graded mobile devices create backlogs of work, and your customers can feel let down when they don’t receive what they believe to be the full value of a phone trade-in. 

Mobile companies must provide quality training and technologies for store employees. This is the only way to drive efficiencies and positive customer experiences. The problem has always been that your customer-facing employees are not technicians. This has made getting accurate device assessments virtually impossible. 

But, after years of evolution, new options have emerged. 

Before we look at these new options, how did we get here?

Stage 1: From early mobile market to Genius Bar

The first cell phone sales were an offshoot of existing telecommunications networks. Mobiles were available at places such as AT&T Phone Center and Bell Phone Center. Electronics retailers including Radio Shack were also early adopters. This evolution meant that cell phone sales increased, with minor repairs being possible because the technology was still at an early stage.

Dedicated mobile-first stores grew throughout the 1990s and early 2000s. But as the technology became more complex, it also became harder to perform technical assessments on site. 

After 2007, a new paradigm blending technical operations and sales emerged. 

Apple’s Genius Bar concept had been launched in 2001. But with the advent of the iPhone in 2007, it became the home for synchronized mobile device sales, diagnosis, and repair. 

Genius Bars were (and still are) staffed by “Genius” employees. Apple trains and certifies employees to perform this role and nothing else. These employees make in-store repairs easier and are touted as one reason for Apple’s high level of customer satisfaction. 

Other carriers and OEMs wished to emulate the Genius Bar model as it became more successful. Some of these companies launched customer-facing technical and diagnostic solutions of their own, but no company’s efforts were as far-reaching as Apple’s. Even today, the Genius Bar remains unparalleled for in-store technical assessment. 

Stage 2: The unrealized promise of web-based diagnostics software 

In the 2000s and 2010s, internet speeds and bandwidth increased. This meant that web-based business solutions supporting phone trade-ins could also emerge. Physically, these web solutions used cables to connect mobiles with desktops or tablets running third-party software. 

Pilots with selected retail staff with technical acumen began well. Consumers received better customer service and there were reports of higher No Fault Found (NFF) deflection rates. This was all without the need to send handsets away for testing. Some phone diagnostics vendors provided on-the-spot training and in-store support, which helped to maximize the effectiveness of the solution and encourage full deployments. 

Unfortunately, many of these efforts subsequently saw a decline in usage. Expensive supply contracts were discontinued and the dream of emulating Apple’s Genius Bar failed. 

What happened? 

A lack of technical skill among retail sales staff was a defining factor in this failure. 

Vendors had assumed that employees would receive technical training, but this was virtually impossible to achieve in the fast-moving retail sector. Carrier and retail sales staff could not be turned into mini engineers. Given all the other demands on their time, they were not the same as specially trained Apple Geniuses. 

Not providing employee training resulted in more transactions involving inaccurate and ineligible devices. These instances affected customer experiences and hindered the success of redemption services. They also incurred significant write-down costs. 

Web-based solutions were also limited in other ways. Many relied on cabled workstations that restricted movement and took up space. As retail stores are often small, this was impractical. 

Although web-based software was imperfect, it did focus attention on process automation because the software enabled employees to automatically perform relevant tests with less manual intervention. 

Combining technical store processes with automation opened the door to new value-added services. This included the in-store phone trade-in and the early upgrade. 

Stage 3: Applications evolved, but cosmetic grading did not 

The web-based solutions of this period were a stepping stone to remote diagnostics apps.

With new remote solutions, customer-facing employees could support in-store phone trade-ins more effectively and with less training. App-based diagnostics also removed the need for cabled hardware, offering flexibility. 

Despite these advances in diagnostics, precise cosmetic grading remained elusive. 

This was because many in the phone diagnostics industry overlooked the need for full grading. A complete device assessment requires both diagnostics and high-level grading. Missing one of these elements can detract from a comprehensive, effective redemption experience. 

To have any gaps in the system means returning to the dangerous potential for incorrectly graded mobile devices. These mistakes disappoint customers and create time-consuming work for carriers and retailers. They also force the adoption of simplified grading standards. 

Stage 4: Bringing diagnostics & grading together 

A new stage in this evolutionary journey has recently happened. It’s one that merges automation and connectivity into a straightforward transaction. It can be navigated by sales staff with minimal process knowledge. In certain spaces, customers can even accurately self-grade and perform their own trade-ins. 

This key development comes in the form of customer-facing, automated trade-in kiosks. Until recently, they were promising, but the size and cable attachment requirements of the units made it difficult to fully advocate for them. 

That changed recently, however, with the development of a new generation of trade-in kiosks. These new units have reshaped the concept as they are smaller, do not require cables, and use accurate AI-driven cosmetic grading capabilities. 

Through a combination of human and AI tests, and 4K cameras, it’s possible to accurately assess any handset. By placing the device inside the machine, users can get their phone graded. We now have a compact, portable, cable-free machine that requires minimal space. 

This development can transform the redemption experience by offering a fully graded trade-in. To optimize this innovation, however, mobile carriers and retailers must still use accurate diagnostics. That’s where Blancco comes in. 

When paired with Blancco’s accurate and comprehensive suite of remote diagnostics solutions for mobile, it’s now possible to have a unified solution for the in-store phone trade-in experience. 

This promising leap forward, in the form of a grading station supported by Blancco’s diagnostics tests, was trialed successfully by the influential Japanese electronics retailer GEO. Along with some large European operators, GEO immediately recognized the potential of this arrangement for in-store interactions and deployed it in several locations as a way to evolve its mobile trade-in programs. 

It’s a solution that looks likely to be taken up by other telcos and mobile retailers around the world. 

Stay ahead as the market changes 

The journey towards comprehensive customer-facing diagnostics and grading solutions outlined here has already driven strong market growth, but there are still opportunities for improvement. And, whether it’s a possible future addition of automated data sanitization or the wider rollout of grading units, the next few years could deliver much for carriers and retailers. 

For example, you probably know that many of your customers are aware of a device’s true value. So, when they perceive valuations as incorrect, they turn to e-commerce rather than coming directly to your business. This leads to the current trend of undervaluing devices for the sake of expedited customer experiences. That’s a race to the bottom that frustrates customers and undermines your long-term profitability. 

To reduce this frustration and recapture ground lost to e-commerce, it’s essential to invest in effective mobile processing technologies that evolve as the market does. 

This is something that makes Blancco a strong partner for mobile carriers, retailers, service providers, and those operating in the second-hand market. Blancco’s mobile products have evolved to include new and better tests, to work closely with innovators like Pandas, to simplify the erasure of Apple products, and much more.  

However the market changes, pick a vendor that understands what those shifts really mean for you. 

Get started now—learn how Blancco’s automated diagnostics solutions can improve your mobile business.

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