In a world where people are starved for human connectivity, a sense of stability and reliability, telcos have a unique opportunity to win loyalty and trust – not through promotions, packages and products, but through purpose. As people’s desires to go back to normalcy and their sense of self escalates, so does the price of inaction. CMOs must convert the surge in customer demand for bandwidth, as a result of COVID-19, into a long-term loyalty play. With social distancing and remote work expected to remain into 2021, telco CMOs should consider creating a purpose-driven brand platform that helps amplify their customers’ aspirations – forfeiting claims-riddled messaging and instead creating space and simplicity in people’s hearts and minds.
2020 is the year the world moved online
More than ever before, people, businesses, governments, schools and communities relied on carriers to stay connected, working, informed and entertained. The unprecedented impacts of COVID-19, series of antitrust battles and new regulations such as GDPR, CCPA and LGDP ushered in:
- More (not less) bandwidth demand at higher cost.
By Q120, bandwidth usage increased 47% - a spike that was originally projected for all of 2020. With 42% of the U.S. labor force working from home full-time, increasing traffic posed a unique opportunity that outweighed its challenges. Making inroads into telemedicine, eLearning and remote working created an opportunity for telcos to gather insights about their B2B and B2C customer base and plot long-term thinking.
- Noticeable shift from retail to ecommerce purchases.
A rise in network demand also means a rise in service level calls. With many wireless retail stores closed due to COVID-19, telco providers saw an uptick in eCommerce activity and call center volume, which not only tests their CXM (customer experience management) journeys, but also the ability to scale with agility.
- The T-Mobile & Sprint Merger.
On April 1, 2020, T-Mobile successfully acquired Sprint, effectively bringing the total number of major U.S. carriers from four down to three. This not only pushed regulatory boundaries, but also underscores how the ‘Big Three’ are on vastly different growth paths: AT&T’s pursuit of becoming a media empire, Verizon’s plans to evolve into a B2B company and T-Mobile’s desire to become the best wireless provider.
A strong signal of what’s to come: 2021 predictions
What started as a ‘race to the home’ became a ‘race to the person’ and will become a ‘race to ubiquity.’ Telcos’ initial race was to secure households through TV, Internet and Wireless bundles that ‘locked up’ customer loyalty by being a one-stop-shop or single pipe to in-home entertainment and communications. With the advent of 4G and OTT services, people began to have power and control in the palm of their hand. The race was no longer trying to serve the single pipe to the home, but instead about mastering personalization and people-based marketing. In this next race, the real prize will be moving people fluidly through a ubiquitously connected world that is built on user data and predictive analytics to make the world around the customer exactly as they want it to be.
- 5G will usher an era of prediction, not reaction.
In the early days of telecommunication, access was still very much device-based and while that will continue to some degree, the 5G era will herald a much different interaction between consumers and their telco provider. In the future, we will be building on the personalized, data-led advances in a 4G world and making everything surrounding the customer smarter and more intuitive. Telcos have already started the next arms race. They’re not just making individual customer contracts, but instead making city-level contracts to ensure entire cities and countries are smart. In this new connected world, everything becomes a screen and an access point that recognizes and intuitively predicts what a customer will desire next based on their pattern of movement, and what services they need and/or desire at a given time.
- Blurred lines between B2B and B2C.
We are increasingly going to witness a shift towards B2B messaging as it will touch every aspect of life, not just traditional communication and entertainment channels. This is why we’re already starting to see brand platforms like Verizon’s Humanability emerging – moving telcos from being a reliability company to a human ability company.
- Biden Administration vs. Trump Administration.
For highly regulated industries like telco, each election cycle poses a set of hot-button antitrust issues between Democratic and Republican administrations. For example, broadband internet regulation fluctuated between the Obama and Trump administrations, and with a Biden administration, we do expect to see a reversal of recent changes. With COVID-19 underlying the importance of high-speed internet access in both urban and rural areas, we expect uninterrupted bipartisan investments in scaling broadband infrastructure. As it relates to 5G, the White House committed to help accelerate the expansion of 5G by making available “a chunk of spectrum” to telecom companies. In favor of more connected cities, Biden proposes a $300 billion R&D investment program that would cover everything from "electric vehicle technology to lightweight materials to 5G and artificial intelligence."
The 2021 playbook for escaping sameness & saturation
Ultimately, CMOs cannot afford to do business as usual or use copycat tactics. Verizon, T-Mobile and AT&T have all adopted each other’s marketing strategies – touting the same claims and benefits, and as a result, only 20% of consumers are currently open to switching providers (Source: Mintel). The ‘Big Three’ can no longer afford to see each other as competitors or see themselves as mere carriers. Instead, they must become champions of purpose, custodians of data protection, and resurrect appreciation for simplicity.
- Sell potential – not products, plans and packages. Telcos should take a more human approach to innovation. It’s not only about leading with the latest tech and features, but how your brand can best service customers across their entire lives. Almost no end user has any conception of the technical underpinnings of network technology so ‘cold phrases’ such as latency, unlimited data or largest 5G network lack the simplicity required for mass adoption. “Warm engineering” on the other hand makes the intricate technology disappear and brings potential to the forefront. As more homes become connected and 5G becomes more widely adopted, telcos will have the opportunity to tell stories about human potential and address top-of-mind questions, such as: Why commute to work when you can connect to work?”
- Siloed data and tools won’t work. There is still a chasm between telcos and consumers, and CMOs must fill this void by playing a more active role in technology decisioning. Telcos are used to working in silos — with marketing, sales, customer service and billing focused on their own remits. In the digital world, this hinders cross-communication about customers and relevant data that could lead to growth. Marketers can develop a 360-degree view of customers when they implement systems that are in parity and deliver real-time, reconcilable data. This data, in turn, can lead to more data-driven decision-making: mining customer data to address customer needs/wants to reduce churn, finding the right prospects across channels, sending personalized offers when people are likely to switch providers, and using data to determine the next best offers or products for key customer segments.
- Becoming a steward of data protection and privacy. Consumers have made it clear that they want to understand and feel good about how their data is being used. The telco that lives up to be a true steward of consumer data protection and privacy reform, will take the crown. Brands should approach data and privacy regulation not from a reactive stance of compliance but from a proactive perch of brand elevation. The fact that only 14% of consumers said that they trust companies and brands to regulate themselves when it comes to privacy is telling. It is also an opportunity. By truly embracing the spirit of consumer privacy and not just settling for appeasement, brands can create an active laboratory for building new consumer engagement strategies rooted in deep and lasting attributes.
- Phil Gaughran, Global Co-Chief Integration Officer, dentsumcgarrybowen
- Joanna Hawkes, VP Integrated Strategy, dentsu
- Megan Keane, Senior Strategist, dentsu
- Rebecca Pinker, Director, Client Strategy, Merkle