How Sprint Aims to Lap AT&T and Verizon With 4G

Apple’s iPhone 4 wasn’t the only big announcement in telecom this month. Sprint Nextel also announced the availability of 4G, a next-generation wireless data network that improves so much on 3G that Sprint likens it to the jump from dial-up to broadband. Sprint launched an ad campaign from Goodby, Silverstein & Partners that compares 4G to other innovations like the car, the TV and the rocket ship. The campaign highlights HTC’s EVO, which the company dubs “the first 4G phone.” For Sprint, the launch is perhaps its most important ever. The company has been losing subscribers at an alarming rate over the last few years and needs an edge against AT&T (which has iPhone exclusivity) and Verizon (known for a robust network). Bill Morgan, Sprint’s svp, brand advertising, discussed the launch with Brandweek. Excerpts below.Brandweek: Do you think most people understand what 4G is, or do you need to do a lot of education?Bill Morgan: People understand it pretty quickly. I think the messaging we’ve had out there for a while that it’s up to 10 times faster than 3G is something that people quickly understand. But the key we’ve found is to get people to experience it. It really takes what’s an understandable claim and kind of dimensionalizes it. It helps you understand how your behavior might change. So in the cities where we’re launching 4G, we’ve done a lot of experiential marketing. BW: What kind of experiential marketing?BM: We’ve been doing for quite a few months what we call mobile marketing vehicles. They’re just as you might suspect—they’re vehicles equipped with 4G and devices. We go around to various high-traffic areas and demonstrate to people what 4G can really do for them. With EVO coming on board now, we’re going to expand that. We’re going to take that into malls and other high-traffic areas. BW: Is it a difficult sell in the sense that most people are already in a contract and may have a few months left, during which time they’ll wait for their carrier to go to 4G?BM: We had such a head start over the competition with 4G. Obviously, we’re the only ones out there with it. The others are in the early stages of development or in some cases don’t have anything going on there yet. So just as there is with devices, there are contractual constraints that inhibit people. But we find that once people experience 4G, they make comments like, “As soon as I get out of my contract,” or “I have to check and see what the termination fee on my contract is.” People are highly motivated once they experience it. We have seen people break contracts and decide it’s worth taking the financial hit. Of course, with some folks raising their [early termination fees] lately, that’s an additional hurdle.BW: Speaking of devices, shortly after your announcement for the EVO, Apple announced the iPhone 4. It seems to me the functionality gap is closing, yet many consumers still see Apple as the gold standard. How do you compete with that?BM: You have to tip your hat to Apple. They do a tremendous job on their products. The iPhone and the iPad are wonderful products. But if you look at the blogs and all the online reviews, we’re seeing that gap narrowing, and [the EVO] is being positively compared to the iPhone. The buzz is that the EVO is better in part because the Sprint 3G network is superior to AT&T’s, and I think the public has spoken loudly about the network performance with the iPhone. So when you then up the ante with 4G, it’s just light years ahead of what that network capability offers. I think it’s interesting that you hear people talking about EVO and iPhone in the same breath, and we’re sharing that best-in-class functionality. And then when you add on top of that the kind of value from a service standpoint—you can get everything on the EVO for $79 and that’s with 4G. You compare that to the iPhone where the best deal you can get is around $120 [a month].BW: Consumers don’t always think logically, though. Do you think that some of them equate “cheaper” with “not as good”?BM: No, we’ve actually had great success with our Any Mobile, Any Time plan, where we compare our $69 plan to the competition’s. So with the competition, you can get unlimited talk for $69, but people say [with Sprint], “I get unlimited text, unlimited data.” That’s a value proposition that people understand, especially in this economy. But the network improvements that we’ve made and with 4G coming very quickly, we find people understand. So, it’s just the opposite. When you describe people saying, “Maybe, it’s cheaper because it’s lesser,” actually they’re saying “Wow, this is a great value.” And when they do experience it, we’ve received great feedback overall on performance and customer service. BW: What do you think is the biggest misconception about Sprint, and how will you address it?BM: We think if people haven’t tried Sprint in the last three years, they’re probably not aware of all the improvements that we’ve made. When [CEO] Dan Hesse came in, he wanted to put a heavy, heavy, almost maniacal focus on customer service. And on the value side, we’ve simplified things. People don’t want to see a meter running while they’re using data. It’s kind of like in the old days when the rental car companies charged by the mile. It wasn’t a good feeling trying to watch the odometer, and it’s not a good feeling trying to watch your minutes.

Brand Marketing

How Sprint Aims to Lap AT&T and Verizon With 4G

Todd Wasserman

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Todd Wasserman