Summary
- Bundles are back, with a twist. Providers are including streaming services with their plans, while cable mobile virtual network operators (MVNOs) take advantage of more traditional telecom packages by bundling their wireless services with their home internet offerings.
- Price wars are not slowing down as options increase and household budgets tighten. With the emergence of low-priced cable MVNO options and increased interested in prepaid wireless, providers need to price accordingly.
Wireless phones have become as much of a household necessity as home internet services, and that necessity comes with a price tag. According to a recent survey, almost half of Americans believe their phone plan is overpriced, with 73% concerned that the price will continue to rise. In a time when inflation is impacting so many U.S. households, consumers are evaluating their options.
Bundles have long been the gold standard in telecom, offering consumers value (although sometimes it’s simply the perception of value) when they sign up for multiple services with a single provider. This strategy has evolved to meet the needs of today’s consumer. Many providers offer streaming services “on them” when you sign up for a plan. This is a logical move — consumers continue to stack up their streaming services, so providing the opportunity to eliminate a bill makes sense. The rise of mobile virtual network operators (MVNOs) continue to change the landscape, creating more consumer options and the opportunity to bundle with more traditional telecom services.
Cable MVNOs have slowly been taking over market share in the wireless space. In Q2 of 2022, cable operators captured 25% of all post-paid account additions. It is projected that cable will acquire 3% of post-paid consumers in 2022, growing to 7% by 2026. Having a wireless offering is a viable strategy for both growth and retention for cable operators.1
As far as prepaid wireless options are concerned, gone are the days when prepaid is only associated with burner phones, used by questionable characters in TV and film. There are essentially two groups of consumers utilizing prepaid wireless. Those who do so out of necessity (unbanked or credit-challenged consumers), and those who use it because they seek value, unwilling to pay post-paid costs. I equate this to the mentality of cord cutters, those who have the means to choose a “premium” service, but simply do not want to. These consumers want value, they know what perks and services they want and that is all they’re willing to pay for. The state of the economy is also creating a new interest in prepaid. Seventeen percent of Gen Z is considering switching to a prepaid plan because of their current financial situation; that number is 18% for millennial parents.2
Consumers are unaware that many of these providers operate on the same, reliable networks. Some cable MVNOs such as Comcast, are even strengthening their networks by utilizing their wi-fi networks and 5G cell sites. With all these viable consumer options, providers need to stand out and build awareness of their specific offerings. Here are some actions providers can take to support their market share:
1. Always-on Marketing: Consumers are becoming less brand loyal, especially younger generations. Only 37% of Gen Z identify as “brand loyalist” so consistently keeping your brand top of mind and touting your perks is the path to gaining subscribers.
2. Household-level Personalization: A household with four wireless users does not need the same options as a household with one wireless user. Personalized messages have proven to get a better response. Working with partners such as Vericast allows providers to personalize messages to the household level, to ensure messaging resonates.
3. Message Amplification During Key Time Periods: Consumers switch plans and buy phones year-round, but the most popular time to purchase is around the winter holidays when there are more sales available, and tax season when consumers have an influx of cash. Vericast is positioned to identify consumers in the market for wireless at any given time and increase frequency and touchpoints to boost provider presence during these key timeframes.
Working with data-driven media providers such as Vericast can help you achieve your acquisition goals. Reach out today to learn more.
