The iPhone is a device that sells itself, right? Wrong. Marketers from Apple Inc. (Nasdaq: AAPL) and AT&T Inc. (NYSE: T) will have to step carefully now that the device is available from Verizon Wireless .
Apple and Verizon jointly announced on Tuesday that the iPhone 4, previously available in the US only from AT&T, will be available from Verizon in February.
Apple is the big winner here. AT&T consistently ranks last in customer satisfaction among US cellphone providers, while Verizon leads (for example, see this recent survey from Consumer Reports).
But Apple can't afford to beat the Verizon drum too loudly, for risk of alienating its partner, AT&T. Apple seems to have found the right tone here, by letting Verizon take the lead in the brief announcement, and sending COO Tim Cook rather than big marketing gun Steve Jobs to represent Apple at the event.
There's not a lot AT&T marketers can do to counter Verizon. Customer satisfaction depends on network quality, and marketers can't go out there with a shovel and pick-axe and lay cables. But AT&T can emphasize what it can do that Verizon can't, and it's doing just that: "For iPhone users who want the fastest speeds, the ability to talk and use apps at the same time, and unsurpassed global coverage, the only choice is AT&T," an AT&T spokesman told The New York Times. The differences between the two models are based on Verizon's using the CDMA cell network, which, unlike AT&T's GSM network, is primarily available only in North America and can't support simultaneous voice and data connections.
AT&T marketers also need to take a local approach. Just because customer satisfaction is higher for Verizon doesn't mean Verizon service is better everywhere. AT&T needs to determine where its customer satisfaction is strong and hit those areas hard. For example, AT&T service is satisfactory where I am, in San Diego, and also, apparently, in Northern New Jersey, where AT&T is significantly faster than Verizon.
Verizon marketers have the most straightforward job. But they can add further momentum by emphasizing those customer satisfaction numbers, and stressing what its iPhone can do that AT&T's can't -- most notably, act as a mobile WiFi hotspot for up to five other devices.
Verizon support could double Apple's smartphone market share and stop the encroachment of phones running the Android operating system from Google (Nasdaq: GOOG) into the smartphone market.
Apple's marketing victory is demonstrated by its stock price. In the days leading up to the announcement, after The Wall Street Journal leaked the news, Apple's stock soared, and AT&T's sank, while Verizon's saw a bump up and then stabilized.
Who's the big winner in the Verizon iPhone announcement? Can AT&T recover? Are Android phones doomed? Leave a message below and let us know what you think.
— Mitch Wagner is Editor in Chief of The CMO Site.
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