How Verizon and T-Mobile are using exclusive perks to boost customer loyalty

Verizon and T-Mobile are pouring more marketing behind newly expanded rewards programs offering discounted and exclusive access to events such as concerts and sports games. The beefed-up perks are designed to reduce churn in the hotly competitive category while solving measurement challenges posed by previous offerings. Mobile carriers have long used enticements—including new customer discounts—as they battle for market share. But retaining customers might become even harder come April, when a new ruling from the Federal Trade Commission takes effect that requires companies to simplify subscription and membership cancelations. Last-minute offers have typically been key for retaining customers on the brink of cancellation, making it all the more important for telecom companies to promote loyalty through rewards programs, said Brad Jashinsky, marketing analyst director at Gartner. “It’s really hard to differentiate your T-Mobiles from your Verizons from your AT&Ts,” he said. “They’re also now facing competition from cable providers offering wireless, which is just another reason to lean into these loyalty programs.” More news: Click to Cancel—what to know about new FTC rule Ad Age recently caught up with executives from Verizon and T-Mobile to learn more about their latest perks and their broader loyalty strategy. The latest salvo in the rewards battle comes from Verizon, which earlier this month introduced a program called Access Concert Series that features live concerts exclusively for Verizon customers. The program is an expansion of the broader Access Rewards program Verizon launched in June, which grants customers entry and special privileges at events, such as sideline access for NFL games and red carpet movie premieres. See all of Ad Age’s 40 Under 40 honorees here The programs come after T-Mobile in February debuted its Magenta Status rewards program, which offers customers discounts at hotels, $5 movie tickets and discounted concert tickets. The brand positioned it as a countermove to other brands it said reduced or eliminated their perks. It specifically cited AT&T, which discontinued its Thanks rewards program in October 2023 after launching it in June 2016. AT&T declined to comment for this story. “We’re going to market it everywhere,” said Vinayak Hegde, T-Mobile’s consumer chief marketing officer. “In our stores and at our events.” On Oct. 20, T-Mobile partnered with fashion creator Wisdom Kaye on a TikTok post in which Kaye styled different Magenta Status perks. @wisdm8 Replying to @T-Mobile Magenta Status inspired outfits 🤝 @T-Mobile #TMobilePartner ♬ original sound - Wisdom Kaye The brand will partially rely on VIP experiences to sell the rewards program, said Kaley Gagnon, VP of marketing. For example, concert-goers will see the value of Magenta Status when T-Mobile customers fast-track into venues through dedicated entrances, she said. Going forward, T-Mobile will couch its Magenta Status marketing in promotions of its T Life app, which began housing all the brand’s offerings in August. ‘Money-can’t-buy experiences’ Verizon’s new Access Concert Series begins with a couple of Latin artists—Xavi will perform a Verizon-customer-only show at Houston’s Music Hall on Oct. 25 and Becky G is slated for an exclusive performance at the Fillmore in Miami on Nov. 12. Customers were asked to claim free tickets using the Verizon app, or enter a sweepstakes by visiting Verizon stores in Miami and Houston. Customers can engage with the Access Rewards program within the myVerizon app. There, they can purchase presale tickets for concerts and sports games, claim free passes to local events on a first-come, first-serve basis and access always-on items such as movie ticket discounts. Once at events, Verizon will give select customers in-seat surprises like sideline access at NFL games. Verizon is marketing its programs using customer relationship management channels such as texting, email and owned channels such as its social media accounts and website. It also relies on partners to promote perks and direct customers to Verizon Access, said Nick Kelly, VP of partnerships. For example, Verizon has taken advantage of its sponsorship of Amazon Prime Video’s “Thursday Night Football” to do media integrations in those broadcasts promoting the perks, including ad overlays during games that show a QR code that takes users to the Verizon Access web page. Starting with the Oct. 31 game, Amazon broadcasts will feature 15-second cuts of Verizon customers enjoying perks. By focusing on “money-can’t-buy experiences” available through Access Rewards, Verizon can sidestep visibility issues the category has typically seen with giveaway-focused programs, Kelly said. “We’ve given all of these things away and then we don’t know what actually happens,” he said. “Do we ever actually see a customer experience this? So, we’re solving that. Our team partners are out there identifying Verizon customers experiencing XYZ and are not only capturing it but amplifying it.” NFL team partners will share Verizon experiences on their social media channels, for instance. That moment when you meet @Mac_BZ thanks to @Verizon Access 🤩Learn more: https://t.co/1y3GFZZhll pic.twitter.com/cwqeTTR2OM— New England Patriots (@Patriots) September 27, 2024 Finding exclusive offers T-Mobile began offering its T-Mobile Tuesdays perks program in 2016, which includes a range of weekly discounts on food, gas, entertainment and more. It used to have a dedicated app, but is now integrated into the T Life app to consolidate its customer experience offerings—Hegde acknowledged that customers previously needed too many apps to manage different services. T-Mobile maintained that it effectively measures the success of T-Mobile Tuesdays by looking at the number of offers customers save in the T Life app. For Verizon, focusing marketing on how customers experience events makes it a little easier to differentiate from competitors that often offer similar rewards like VIP areas at concerts and tickets at sporting events, Kelly said. “That’s one of the challenges heading into 2025,” he said. “If we’re all offering the exact same thing but it’s different events or different venues, you really just care who the music artist is, and that’s not really dictated by us.” An added challenge he faces is pushing partners such as Live Nation to come up with exclusive offers as they also work with other telecom and financial services companies on crafting relatively similar experiences. Credit cards have long offered exclusive perks to members, and brands such as American Express have beefed up their offerings of late, including opening airport lounges and other exclusive experiences. No matter the category, these programs are similarly designed to boost customer retention and reduce churn, Jashinsky said. Telecom companies report different churn figures for prepaid and postpaid plans. Reducing postpaid churn is more highly valued because those plans, which consumers pay for at the end of a billing cycle instead of upfront, generate significantly higher revenue per user. One figure most companies report is postpaid phone churn, which T-Mobile defines as the number of customers who deactivated service represented as a percentage of the average number of customers during a specified period divided by the number of months in the period. Verizon reported retail postpaid phone churn of .85% for the second quarter of 2024, while T-Mobile and AT&T reported postpaid phone churn of .80% and .70%, respectively. Those figures may already seem low, but every percentage point matters in telecommunications, Jashinsky said. Many customers pay up to $200 for monthly family plans and home internet, and unlike other churn-stricken industries such as streaming, consumers are only subscribed to one company at a time, and often for years. NextGen Marketing Summit Join us for a crash course on Gen Z, DTC marketing and the creator economy Register today Telecom companies expect dips and rises in churn throughout the year. Given the relative newness of both Verizon and T-Mobile’s rewards programs, companies are monitoring early success based on in-app engagement where customers can manage their accounts or attendance at VIP events. For example, T-Mobile has observed customers contribute 5% to 10% of total opening weekend box office sales in North America since Magenta Status began offering $5 movie tickets. Looking forward, both companies plan to closely monitor their rewards program marketing and how much it is drives business. For Verizon, that means brainstorming experiences for advertising’s biggest day at Super Bowl LIX on Feb. 9, Kelly said. The company has not detailed its Big Game plans but has been known to air pricey Super Bowl ads, including putting Beyoncé in an ad last February.

How Verizon and T-Mobile are using exclusive perks to boost customer loyalty

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