Closed loop ate my glass slipper!Thursday, 26 May 2011 Fairytale ruined as ugly sister wins (consumers') heartsAt a recent meeting in London a number of the leading prepaid program managers in Europe reflected on what was inhibiting the growth of prepaid across Europe. The group identified the following:
While I agree with all the above it does have an open-loop bias. Nearly every discussion around prepaid has an open-loop bias. Open-loop products are certainly gaining traction in Europe but they have a long way to go to reach the levels predicted, and even further to pass out the ugly sister that is closed-loop.
Along a similar vein, at a recent conference European prepaid market statistics were presented as “open loop growth rate now eclipsing closed loop”. While open loop had indeed grown from circa. 3% market share to over 5% (growth of 66%+), closed loop had also grown in the same timeframe albeit by a couple of % to just shy of 50% market share. Why not celebrate that?
Closed loop is a success. There are many fine examples of successful programmes. Dare I say it, some providers are even making a profit! Of course it has its problems, but maybe it is time for the ugly sister to get a make-over and learn to dance.
DH
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