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What's in Store
for 2013?

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Telecommunications

By Kevin Perlmutter

Telecommunications

Comedian Louis CK may have said it best when talking about people’s frustration with relatively new mobile technology. “Give it a second. It’s going to space and back. It’s amazing. Is the speed of light too slow for you? The worst cell phone in the world is a miracle. Why do we expect it to be perfect?”

The telecommunications industry has changed dramatically in the last decade. In 2001, only 15.5 percent of the world’s population had a mobile device subscription, and by 2011 that number rose to 85.7 percent, according to the International Telecommunications Union.

The scale and pace of change in this industry is unprecedented, and consumers are increasingly becoming addicted to new capabilities. As the cycle of demand and innovation accelerates, it will stimulate further changes in consumer and business behaviors, and the bar will continue to be set higher. This will put increasing pressure on telecom companies to evolve and stretch, just to keep up with the demand they’re creating.

Beyond the build out of high-performing networks, Interbrand sees three key areas of focus for the telecom industry in 2013:


"The scale and pace of change in this industry is unprecedented, and consumers are increasingly becoming addicted to new capabilities. As the cycle of demand and innovation accelerates, it will stimulate further changes in consumer and business behaviors, and the bar will continue to be set higher. "



1. Increasing importance of customer experience and brand trust
Brand trust is getting harder to earn worldwide and, in some markets, earning trust in the telecommunications sector is even more challenging. As telecom brands look to expand their businesses into areas like mobile banking, digital life, connected cars, home security and cloud services, they will need to strengthen customer relationships. They must excel at the most basic level of service if they expect to maximize their opportunities in new areas of business. They will need to increase efforts around understanding emerging behaviors in order to keep up with and/or drive demand, remain relevant and stay ahead of the competition.

The T-City experiment is helping Deutsche Telekom do just that. Since 2007, the company has turned cities into “future labs.” It has deployed emerging technologies in order to monitor their usage, demand drivers and community impact. Ethnographic research at any scale will help telecom companies to uncover customer insights and develop truly customer-centric Go-to-Market strategies. This is especially important as they expand into unfamiliar industries, and attempt to partner with players and alter the existing ecosystem.

2. Corporate citizenship
Interbrand research has shown that socially responsible brands earn increased favorability and advocacy. Nielsen says that 66 percent of consumers around the world would prefer to buy from companies that give back to society. Telecommunications organizations are in a unique position to create incredible impact on the very communities they serve and will increasingly activate these programs. In the U.S., AT&T is doing exactly that with two significant initiatives. First, AT&T Aspire, an educational initiative backed by over 250 million USD, aims to reduce high school dropout rates and improve workforce readiness. Secondly, “It Can Wait” is an AT&T anti-texting and driving program that’s expanding in 2013. Also in the U.S., Verizon is supporting the awareness and prevention of domestic violence with a corporate commitment of more than 40 million USD. Programs like these are important steps for telecom companies that wish to improve their societal contribution and brand sentiment.

3. International expansion and consolidation
Business is increasingly global and people are traveling more — and telecoms are responding. Services like the eSim card, for instance, will enable travelers to easily switch mobile operators based on location and price. Telecoms are also becoming more price competitive when it comes to international roaming. Further, expect to see more cross-border industry consolidation and partnerships such as SoftBank’s proposed purchase of Sprint in the U.S., or Carlos Slim’s America Movil SAB’s overseas expansion in partnership with Royal KPN NV (Dutch Telecom) and Telekom Austria. In 2013, we believe that telecoms will increasingly begin to expand internationally, whether through international alliances or acquisitions — all to create international networks for their customers.

In 2013, customer expectations will continue to increase, and telecom companies will need to respond in relevant ways in order to capitalize on the customer demand that their very own technology is responsible for creating.

FYIQ

  • ABOUT KEVIN PERLMUTTER
    Kevin Perlmutter is Senior Director, Strategy, Interbrand New York.

    What’s one thing you would change about the world if you could? Kevin answered: "I’d like the world to be safer with less senseless killing due to war, terrorism or crime." Kevin.Perlmutter@interbrand.com
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