Virgin Mobile to reward big spenders

Virgin Mobile is to launch a new offering next month aimed at rewarding and retaining its high-end customers.

A company spokesman said: "We aim to give them some of the benefits of a contract. We want to reward, attract and retain loyal customers."

Details of the offer, hinted at in the operator's trading statement today, are not yet available. But the spokesman said Virgin is aiming at bringing supermarket bulk-buy principles to the mobile phone market with added Virgin panache.

Benefits may include being able to pick pricing and usage plans and gain vouchers with the pre-pay model of being able to budget mobile use. The bonus for the user will be lower prices for extensive use and not having to sign a year-long contract.

Virgin's move is the latest in the continuing battle against 'churn', or customers moving to other operators or from pre-pay to contract or vice-versa. The annual churn rate for all operators in the UK is estimated to be between 25 and 30 per cent.

Around 70 per cent of the UK market is pre-pay. None of Virgin's customers are on contract; 95 per cent of them are pre-pay and the rest are direct debit.

According to Virgin's trading statement, released in advance of interim results due in the middle of November, growth is strong and margins are increasing. The company has paid off £30m in debt and should be able to pay a dividend in its first year.

Virgin had 4.1 million customers as of the end of June. New customer figures will be released with the interim results in November.