VM operate the same "bait and switch" practices as other telcos, energy suppliers, insurers, breakdown & household service companies. They all offer heavily discounted pricing to attract new customers. They have also got wise to people asking for discounts. If (as I suspect) they're like the large customer service companies that I've worked for, then the following principles will apply:
1) All companies see customers drifting away over time for different reasons. Just to keep customer number stable, discounts are offered to entice new customers because no discounts means uncompetitive pricing and no new customers. And once they've got a customer onboard there's the prospect of upselling on speed and cross selling other services like TV packages, wifi boosters and mobile contracts, which can be very profitable add-ons.
2) Around half of all customers will accept the out of contract price when an introductory discount ends. There's complicated modelling of customer attrition rates over time that are used by the pricing teams when designing introductory discounts, and the whole practice relies on a small number of customers who will stay with the company on an undiscounted offer for years. Some leave immediately, some (like you and I) phone up and ask for a discount, with varying levels of success, some stay on the undiscounted rate for a few months before leaving or renegotiating. This is important, because it means the net present value of future cash flows from an "average" new customer will be greater than for an existing customer offered the same discount, because the company's modelling will indicate existing customers who get a discount are far more likely to ask for a repeat discount every time the last one ends.
3) Even then, existing customers who negotiate are not all offered the same discount - complex modelling and behavioural analytics are often used either at an account or a segment level that take account of how likely they think a customer is to leave, how much that customer pays and what services they take, along with location and demographic data. I would expect that some customers will not under any circumstances be offered a discount, eg if an area has a big queue of people wanting to join, but not the capacity to accept them, or maybe if the customer is on a low margin product like 100 Mbps broadband only.
4) Even the maximum available discounts vary daily or weekly, depending on competitor marketing campaigns, customer loss/retention numbers, and whether VM are happy or worrying about what their parent company has to tell investors that quarter.
5) VM's first offer of a discount is never their best offer, but the retentions agents have rules for what discounts can be offered. So phoning and complaining about price and hinting you might leave might get you a couple of quid off, a more convincing threat to leave might be four quid off, a threat to leave with a valid knowledge of somebody else's discount pricing might be six quid off. Somebody who actually cancels will (unless they are on the "no discount" list) often be subject to win-back efforts, and they'll get even better offers during their months notice period, occasionally at or even below new customer pricing. That gets you the best price, but if for one of the several reasons mentioned above they DON'T phone and offer you a discount then you need to plan accordingly. Consider that if you had broadband and phone, you gave notice but didn't have another supplier contracted, you would lose your landline number and any VM email address.
The retentions agents are on bonuses to retain customers but give away as little discount as appropriate, and they are trained in this, and they do it day in day out, compared to you or I doing this a couple of times a year for different services. So it isn't a level playing field, and if you want a better discount you need to be prepared. Although not all will apply to you, see this post.
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