Consumer Cellular, approaching a half-billion dollars in annual sales, gets tryout with Target [The Oregonian, Portland, Ore. :: ]
(Oregonian (Portland, OR) Via Acquire Media NewsEdge) March 30--Consumer Cellular is getting a spring tryout -- in the cactus league, no less.
Beginning this week, retail giant Target will stock the Tigard company's cell phones in 32 stores in the Phoenix, Ariz., area.
It's an experiment to see if Consumer Cellular can gain the same kind of traction with Target that it's had with Sears, which stocks Consumer Cellular's phones across the country. The company expects a decision on a wider rollout by summer.
Consumer Cellular is among Oregon's biggest technology businesses and fastest growing, though one of its least known.
Partnerships have been key to its growth, starting with the AARP and then expanding with a 2011 deal to put Consumer Cellular's phones in hundreds of Sears stores nationwide.
"Target could be the next one," said Consumer Cellular chief executive John Marick. "They've got 1,800 stores across the country. You do the math -- you don't have to sell too many phones at each one for that to really add up."
Privately held Consumer Cellular markets cell phones to seniors -- offering low-cost, no-contract plans for people who want a mobile phone but don't use it heavily, and don't want to pay the big cell phone companies' monthly fees.
Consumer Cellular's phones start at $35 and a monthly plan costs just $15 to customers who can keep their calling under 200 minutes a month. The Tigard company also offers a selection of data plans and smartphones, including the iPhone. It leases space on AT&T's network to provide voice and data service.
While Consumer Cellular operates a niche business, it's a rapidly growing niche as baby boomers age and wireless technology becomes pervasive. Consumer Cellular's revenues hit $355 million last year.
Annual sales have climbed by at least 35 percent in each of the past several years, and Consumer Cellular expects that to continue this year -- putting 2014 revenue just shy of $500 million.
Target wants to see immediate results, Marick said, and will be making decisions about what it will stock this fall by early summer. So the key to making the new partnership work will be demonstrating that Consumer Cellular can drive shoppers to its stores, and doing it quickly.
Initially, Marick said, that means steering new Consumer Cellular customers, most of whom sign up online or over the phone, to Target to pick up their new phone.
At Sears, those in-store pickups gradually grew into in-store sales as Sears personnel grew more familiar with the product. Consumer Cellular is hoping the same pattern repeats at Target.
As Consumer Cellular has grown, the company's work force has expanded from around 200 in 2010 to more than 900 today. Most work in call centers in Tigard, Redmond and Arizona. Customer service is key to the company's brand, Marick said, so managing that growth and maintaining service standards has been the greatest challenge.
Founded in 1995, Consumer Cellular is still owned by Marick and the other executives who run it. They have fielded calls from potential investors over the years, and interest has increased along with the company's scale. Marick said the company isn't talking with prospective investors or buyers now.
"So far we've been able to do all the things we want to do," Marick said. "We don't need the cash in order to meet our customers' needs, or the needs of the company."
Consumer Cellular has founded its growth rate, 35 to 40 percent, to be sustainable and manageable -- and isn't interested right now in taking risks that could jeopardize that success.
"If we were trying to grow 40 or 50 percent" a year, Marick said, "we certainly could have done something wrong and put ourselves in trouble."
-- Mike Rogoway; twitter: @rogoway; phone: 503-294-7699
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