T-Mobile Challenges Verizon in Brand Perception in Wake of NSA Data Scandal

Consumers More Likely to Switch to T-Mobile Than AT&T, Verizon

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T-Mobile's rebranding as the "Un-carrier" appears to be working, at least according to research from YouGov. The brand perception firm found that for the first time since it began tracking the data a year ago, smartphone users are more likely to switch to T-Mobile than Verizon.

Likewise, T-Mobile's brand perception -- as measured by YouGov's BrandIndex Buzz score -- has twice surpassed that of Verizon in the past four months as Verizon weathered revelations that it provided customer metadata to the National Security Agency (NSA).

YouGov determines Buzz scores by asking adult respondents: "If you've heard anything about the brand in the last two weeks, through advertising, news or word of mouth, was it positive or negative?"

The spike in T-Mobile's brand perception started in late March, immediately after recently-appointed CEO John Legere debuted the company's rebranding in hilarious and profane fashion (see video below). T-Mobile's Buzz score more than doubled from less than 7 points prior to the announcement to approximately 15 points in mid-April when it surpassed Verizon for the top spot.

Verizon's brand perception quickly recovered to regain the No. 1 spot before nose-diving in early June following news it provided customer metadata to the NSA, at which point T-Mobile again became top brand awareness dog in the wireless provider industry. (AT&T and Sprint were also implicated as participating in similar data-sharing arrangements.) Verizon's Buzz score briefly fell to third behind No. 2 Sprint.

"Verizon Wireless has always welcomed competition and we work hard every day to provide customers with the best choices, devices, plans and network possible," a Verizon spokesperson said.

The changes in T-Mobile and Verizon's respective Buzz scores reflect a similar shift in customers more likely to switch to T-Mobile than Verizon, according to YouGov's CategoryView. For CategoryView, YouGov surveyed consumers whose primary phone is a smartphone and who said they were likely to change carriers within six months.

In the first quarter, only 11% of respondents said they would switch to T-Mobile. By the second quarter that figure had risen to 20% and settled to 16%. The percentage of customers willing to switch to Verizon has been cut in half from last fall (24%) to the current quarter (less than 12%).

Interestingly, Verizon has recently reclaimed its position as the most well-regarded carrier brand despite consumers' being more likely to switch to T-Mobile. Verizon mounted a comeback in July, the same month it announced Edge, a phone trade-in plan meant to rival T-Mobile's Bill Hader-approved Jump program. AT&T saw a similar jump in Buzz score when it announced its similar program, Next.

The peaks and valleys in the Buzz scores illustrate how fickle wireless plan consumers are. The data suggest that they don't like having their metadata shared with the government, but they're willing to overlook that if they can upgrade their phones more often. They're also more willing to switch to T-Mobile than Verizon, but they view Verizon slightly more positively.

Ultimately, the only thing that matters is selling phone plans, and to that end T-Mobile's attempted turnaround this year has been successful. T-Mobile announced on Thursday it had added 1.1 million customers in the second quarter this year, its largest uptick in four years.

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