Perception is an important piece of the puzzle for every successful company. It is vital to communicate your story so investors, customers, the media, regulators, and in fact, everyone perceive the company as growing, moving in the right direction and doing the right thing. AT&T has missed the mark with regards to perception in recent years.
I have followed AT&T for decades through various ups and downs. I like the company. That being said, AT&T continues to struggle. One reason is because they are losing the battle of perception. And this is one of the most important battles every company needs to win.
Consider the AT&T churn rate. Churn rate is the percentage of customers a company loses during a period of time. This is one good way to determine whether customers are generally happy with a provider by sticking around.
AT&T struggles with increasing churn rate meaning unhappy users
The higher the churn rate, the worse things are for the customer at a company.
Years ago, the churn rate for competitors in the wireless industry was higher. That was when quality was not as high as it is today. Carriers have successfully worked to reduce this number by improving customer experience.
Now, AT&T Mobility has been struggling under a renewed and increasing churn rate. That means customers are saying they are increasingly unsatisfied and leaving for a competitor.
This time it is not a quality story. This time the problem is around other things like cost of services, cost and performance of 5G, connectivity issues and most importantly, customer care.
Which wireless competitors are customers choosing?
So, where are AT&T customers going? Today, there are plenty of companies a wireless customer can move to.
Staying in the post-paid world, AT&T customers can switch to Verizon Wireless or T-Mobile.
Of these two competitors, I would guess most customers are switching to T-Mobile today. The reason is Verizon Wireless is facing some of the same issues as AT&T, plus they are the most expensive competitor.
In a weak economy, customers look for lower costs. Verizon is the highest priced wireless carrier.
A growing number of pre-paid wireless resellers, or MVNO players are also winning a sizable amount of what AT&T is losing.
The reason once again is simple. Savings and a weak economy. When money gets tight, customers look for a less expensive alternative.
Doing business with AT&T, T-Mobile, Verizon costs more than resellers
The bottom line is doing business directly with one of the big three costs more than a reseller. However, this extra cost does offer some advantages. But, as the bad economy continues to churn along, customers are looking for less expensive alternatives.
Some of the advantages of doing business directly with Verizon, T-Mobile or AT&T include:
· Getting primary access to wireless towers for wireless data usage.
· Are more often usable outside the USA, while most resellers are not.
· More wireless data in their plan which is important because when you reach your plans capacity, the speed slows way down making the phone almost unusable for the rest of the month.
Plus, assorted other goodies. So, there are benefits. However, as the economic problems continues, more customers are looking for financial help.
To save money, customers are increasingly choosing less expensive alternatives.
Customer cost for doing business directly with a wireless carrier can be between $60-$150 per month, depending on the plan and carrier you choose.
Customer cost for doing business with one of the MVNO resellers can be in the $20-$60 range. This is a very big savings for customers.
Weak economy sends users to find less expensive wireless alternative
That significant savings is why this reseller sector is growing much faster than the traditional wireless sector.
There are quite a few resellers customers can choose from. A few of them include Comcast Xfinity Mobile, Charter Spectrum Mobile, Altice Optimum, Cricket, Visible, PureTalk, Consumer Cellular and countless others.
Some of these are owned by one of the big three networks. So, for example even though AT&T is losing customers, their Cricket brand can continue to grow.
Resellers like Xfinity Mobile, Spectrum Mobile, Cricket and PureTalk
AT&T has been battling against this onslaught of new competition for years. That’s good news for the customer, but not for AT&T. And that ongoing battle showing no signs of relief.
In search of growth, AT&T made a bad move several years ago by acquiring DirecTV, CNN and Warner Brothers Media to create WarnerMedia. It failed. So ultimately, they sold off when it did not help Ma Bell. They have not yet fully recovered.
Verizon also made a bad move acquiring Yahoo and AOL for the same reasons. This did not work either. They sold off these assets as well. They have not fully recovered yet either.
Now AT&T and Verizon are back to being wireless, telecom and data network providers for consumers and business customers. They are back where they belong.
Ten years ago, T-Mobile was dying on the vine
A decade ago, T-Mobile was dying on the vine. Their turnaround took a while, but they have since recovered and have been a solid growth company in the wireless space in recent years.
So, between the battle with T-Mobile plus all the wireless resellers AT&T has been having a rough time in the competitive marketplace.
This T-Mobile advantage should last for a while, but not forever. The question is when will their growth slow, as it will inevitably do?
AT&T is an important competitor in wireless, telecom, data space
I would love to say AT&T has started to rebuild and are in the recovery mode. They are an important competitor and a wireless and telecom provider.
That being said, they are not. Not yet anyway. They don’t seem like they are back on the rapid growth side of the growth wave as we had hoped.
T-Mobile was struggling for life a decade ago. They recovered. So, if T-Mobile did it, AT&T can do it as well.
AT&T’s right hand doesn’t know what left hand is doing
Another large part of the AT&T problem is the right hand doesn’t know what the left hand is doing.
An example is how their poor customer service reps drop the ball. I would guess either they are not trained well enough, or they simply do not care for the customer.
They carelessly cancel services customers use, without the customer requesting the service be cancelled. This is reducing their revenues and ticks off the customer.
I have written about this in the past. How when a customer called AT&T to make a few changes, the company cancelled all services. Then when the customer called back to complain and get the services back, they were told they could, but they lost their phone numbers forever.
If AT&T shows they don’t care, why should the customer? That is another key problem they created which they now must live with.
Bottom line, this is a bad, expensive problem for the customer, and it is all caused by AT&T and their poor customer care and customer service.
AT&T needs to improve Public Relations and Customer Relations
Perception is such an important piece of the puzzle. Having the left hand and the right hand be on the same page is another. Having all sides of a company work together rather being a case of opposing forces.
These are some of the areas where AT&T misses the mark. And that is costing them in lost market share and revenues.
AT&T needs to better train all their workers to care for the customer.
Public Relations and Customer Relations are key parts of any successful business. It is a very important part for any company to get right. Especially in a marketplace which is so competitive.
Companies must control the PR narrative, or they will lose
Public Relations is important. It is important for successful companies to show who they are and what they have accomplished. It is also important for companies who are struggling to show themselves in the best light.
If AT&T doesn’t control the narrative, the marketplace will do it for them. When media and analysts create the narrative, it is never pretty for the company.
That’s quite a bit, but that’s exactly what is happening with AT&T today. That’s why they are losing the perception battle. They created this reality all by themselves.
Let’s be clear. I want AT&T to be a winner once again. Let’s hope they can create forward momentum and turn things around like T-Mobile did a decade ago.
The bottom line is, one way or another AT&T needs to find the right path. They need to make the magic happen. Something they have not done in quite a long time. I hope they can do it.
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