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Verizon gets a lesson in remedial business management 101
Any current or former Verizon user that read this past Friday’s Wall Street (4/21/17) had to get a good chuckle out of the article on how Verizon had posted its first quarterly loss due to customers leaving them for the competition.
Gee! Was ANYONE REALLY SURPRISED???
For those of us that have been constant and loyal Verizon customers for many years, we’re finally seeing Verizon(VZ) waking up and realizing that the basic tenets of undergraduate business school concepts still hold true – it’s the CUSTOMER, stupid!
Back in 2011, VZ decided to punt unlimited data plans from the cell phone service plans it provided. Further, and even more annoying, if you wanted to upgrade your cell phone hardware, it meant having to buy a new service plan as they wouldn’t let you grandfather your old plan with any unlimited options, to the new phone. Well, there was a way around it and I still kept my unlimited plan when I upgraded, much to the chagrin and consternation of VZ. You can’t imagine how many spam calls I’ve gotten over the years from VZ telling me how much greater the new plans were – but of course they were NOT unlimited data and would charge me a tonne of bucko$ after a certain data useage – not to mention slower speeds for actually using the unlimited data you were paying for. Add to that when you had to leave your current units for iPhones or whatever, VZ had removed the automatic hotspot capabilities that allowed you to turn your cell phone into wifi hotspot. But, you could buy more hardware at a high price and pay more money to get the same functionality you had before. This attempt to ripoff customers didn’t last very long.
Enter AT&T, Sprint and everyone else with their unlimited plans, acceptable service hardware and all at a much cheaper price. Basically, someone at these companies had a clue at what doing market analysis really is and actually figured what the customer really wanted and how to make money selling it to them!
It didn’t take much marketing from the competition for people to realize that the Verizon bimbo that was always wandering around asking if anyone could hear him, was costing them too much and they didn’t have what they used to and more importantly WANTED. It also didn’t take too long for the Verizon bimbo to realize this as well and he switched from Verizon. Gee, go figure.
According local sales reps in the stores, the very recent and sudden changes in plan offerings to include unlimited data and much better pricing structures was a huge surprise that they were only informed of, literally, until minutes before the public was. Kind of sounds like VZ had a major “oh shit!” moment and a major reality check! Gee…wonder why….
My guess is that in the future business schools will be adding this to the litany of case studies that undergraduates will have to endure. It would make another of the many good case studies of how you will lose market share by not offering what the customer wants and is willing to pay, as well as being too arrogant to be aware of your market competition and think that just because you’re currently the 800 pound gorilla on the playground that things can’t change against you…and quickly!
Interestingly enough, we’re seeing other former market share “gorillas” thinking the same thing and also seeing that they’re losing market share. In my opinion, this list would start with none other than IBM…
I’m Don Rima and that’s the view From Where I Stand.