Vonage's $3.99 Retention Plan

Vonage offers a $3.99 per month retention plan to customers who might jump ship to providers with more certain futures. The plan is meant to shore-up Vonage’s customer churn rate, especially as the internet telephony company struggles to stay alive amidst a patent dispute with Verizon. Vonage’s churn rate last quarter was 2.4%, high enough to spook investors or anyone considering a potential acquisition. A comment left by a self-avowed Vonage flack tries to put a positive spin on the offering:

This promotion is not new and has actually been around for several years now (at least 3 years or so), and it’s usually used, when/where necessary, as a short-term retention promotion. That said, this is by no means something Vonage uses broadly. Less than 1% of Vonage’s total customers are currently in the $3.99 program. Since this is such a small number of Vonage’s overall customers, the plan’s low price point does not significantly impact the company’s financials.

To join the 1% of Vonage customers who pay less than $50 per year for telephone service, call Vonage and threaten to leave for greener pastures. Tell them that the service’s future is uncertain, and that it is just too expensive; don’t hesitate to mention that you would be willing to stay for a reduced rate. If you succeed, let us know by sending your story to tips at consumerist dot com.

Vonage offers $3.99/month to retain customers [VOIP & Gadget Blog via ZDNet and VOIP Watch]
(Photo: Scot (PhotoNoob.net))

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  1. allstarecho says:

    What’s failed to mention is that this plan is free incoming calls but billed at 3 cents a minute for outgoing calls. I pay $5.00 a month for my Vonage after really wanting to cancel last month, free incoming, 3 cents outgoing. Plus they gave me 6 months credit. So free for 6 months, then $5.00 a month. I’ll keep it. They probably won’t be around in 6 months anyway.

  2. Crazytree says:

    we need a story/forum thread dealing with retention plans for major companies and how to best exploit them.

  3. badhatharry says:

    Does their retention plan include letting me play with this dog? Because I’m totally in.

  4. bohemian says:

    We dumped our Vonage recently. Our new cable provider gives free digital phone service with our package that costs the same as our other cable provider without it but we get way more channels and free phone.
    Vonage had an issue with my c-card and shut off our phone. Our bank reissued my card after it was found in the batch of lost card numbers in the recent TJ Maxx data theft. In dealing with all the places I had to give my new c-card number and trying to figure out what my rarely used Vonage login was to get this updated they turned off our outgoing phone service.
    That was what sent me looking elsewhere. Now I have free phone service. Buh bye Vonage.

  5. ShadowFalls says:

    I pay less than $50 a month for unlimited local and long distance, US and Canada. But then again, I don’t have Vonage, I have Brighthouse with 24/7 tech support. No equipment to buy either, and it is a single device for the cable modem and phone. No issues about worrying about a problem with the router as well.

  6. mathew says:

    If you use Gizmo (gizmoproject.com) the regular rate for a dial-in number is $4 a month, and you just pay for whatever minutes you use for outgoing. So I guess that’s why Vonage’s desperation rate is $3.99.

  7. FLConsumer says:

    Had Vonage for awhile… Back when I signed up with them, they honestly were one of the better VoIP providers (other than wholesale). Used to run me ~$31/mo

    A few years have passed and Vonage’s reliability and tech support have really tanked. I’ve since moved onto Viatalk. I pay ~$8/mo for unlimited local & long distance, didn’t have to buy any equipment either. Unlike the cable co’s, I can use my Viatalk account on any SIP device of my choosing and can take it anywhere I wish. When I go on holiday this week, I’ll be taking my PDA d laptop with me, both which have SIP clients on them, so I’ll have my home & business phone lines at my hotel room.

  8. orielbean says:

    This is what Vonage was good for – a catalyst for VOIP to be used up in the market reaction. I remember getting the stock IPO notice so I could buy some of that trash when they went public. Now we get the phone service in broadband for reasonable prices.

    Thanks Vonage! I will send a delightful floral arrangement to your closed-casket funeral.