Device Contribution Margin Management
Brightstar’s device contribution management service aims at lifting overall profitability of the device portfolio.
What is Device Contribution Margin? In simple terms, contribution margin measures the profitability of one device for the operator. It is defined as the lifetime revenue generated by that device less the variable cost directly associated with that device (i.e. procurement cost, commissions).
Management of the device contribution margin is a core component of Brightstar’s Device Management service that can bring high-value benefits to the operator including:
- Reducing average subsidy costs (understanding which handsets perform well at which plan levels)
- Increasing average ARPU (understanding which handsets deliver better than average ARPU)
- Providing increased leverage for vendor negotiations
These benefits are delivered through:
- Real-time reviews of device-by-device product performance against the original device business plan
- Systematically identifying and supporting high contribution margin devices with fact-based and data-driven decisions
- Dynamically responding to competitor activity
