Last year, Trone Brand Energy launched a national survey of home internet subscribers to get a peek into their understanding of their service, most frequent internet activities, biggest frustrations and internet shopping behaviors. The 980 respondents who completed the survey represented several classes of telecom providers—from the largest national home internet providers to much smaller regional providers.
The goal of this series was to gain marketing insights for the next wave of potential high-speed internet customers. Remarkably, people that share the mindset and behaviors of fiber-tier subscribers existed across the entire customer spectrum. This shows that converting customers is about developing a differentiated marketing strategy that speaks to the unique advantages for each class of provider.
Now that it’s 2018, we felt it was time to revisit our national survey of home internet subscribers. We wanted to better understand the difference between how the subscribers of the biggest internet providers think compared to subscribers of the rest, including those who subscribe to smaller, regional internet providers.
Scoring Telecom’s David and Goliath
AT&T, Charter Communications (consisting of Time Warner Cable and Spectrum), Comcast and Verizon made up the top four home internet providers and represented 65% of all respondents. The remaining 35% subscribed to CenturyLink, Cincinnati Bell, Cox Communications, Google Fiber, Sprint, Windstream and other regional providers.
For the purposes of this article, the top four home internet providers will be referred to as, “The Big Four,” and the remaining internet providers will be called “The Alternatives.” Nearly half of The Alternatives internet provider group consists of a subgroup of smaller, regional internet providers.
One way to quickly understand the level of advocacy for a given brand is to calculate its Net Promoter Score® (NPS®)—a number ranging from negative 100 to 100 indicating the difference between the percentage of promoting customers to detracting ones. Author and business strategist Fred Reichheld developed the widely adopted NPS® as a way of measuring a brand or organization’s performance with the philosophy that the typical mid-growth brand in any industry would score between a five and a 10.
What is NPS®?
A number ranging from negative 100 to 100 indicating the difference between the percentage of promoting customers to detracting ones.
After classifying all home internet providers into two groups, The Big Four and The Alternatives scored similar NPS® scores of negative 24 and negative 32 respectively. When you look at only the smaller, regional internet providers, a subgroup of The Alternatives, the result is a similarly low score of negative 26. We have conducted similar studies with national home internet subscribers and found comparable NPS® scores—indicating the low level of customer advocacy and quality of relationships commonly found in the telecom industry.
While these numbers are not particularly good news, they begin to dispel the notion that The Big Four group consisting of AT&T, Charter Communications, Comcast and Verizon has more critics compared to other internet providers. Subscribers are hesitant to recommend their current home internet provider to others across the board.
Trust and Reliability
Given the similarity in NPS® scores for both provider groups, we needed to understand the biggest service attributes helping or hurting the NPS® scores for The Big Four and The Alternatives. We wanted to understand if their scores were impacted by the same attributes. That way, we could determine the biggest hurdles that need to be overcome to move those negative NPS® scores toward positive territory.
We asked our survey respondents to evaluate the importance of the same set of key service attributes when comparing and choosing their home internet providers. This service attribute list included generic service attributes like: “responsive customer service,” “faster internet speeds,” “local customer service locations” and “responsiveness during issues.”
Interestingly, The Big Four and The Alternatives groups have different sets of service attributes that have the biggest impact on their NPS® score. The percentages in the chart below are based on the Top 3 Box measures, which represent the total percent of respondents finding a given attribute to be important when deciding on or comparing home internet providers.
The Big Four Subscriber: Biggest Hurdles Impacting NPS® (Top 3 Box)
95%—Faster internet speeds
95%—Responsive customer service
95%—Responsiveness during customer issues
The Alternatives Subscriber: Biggest Hurdles Impacting NPS® (Top 3 Box)
97%—Reliability of service (e.g., few outages)
84%—Helps everything in your home run seamlessly
The Big Four
The Big Four subscribers are looking for their internet providers to deliver on faster internet speeds and responsive customer service while The Alternatives subscribers are primarily looking for their internet providers to deliver on reliability, and secondarily, on helping things run seamlessly.
The key difference between these two groups is the word “reliability.” Reliability doesn’t rank as one of the biggest hurdles impacting The Big Four group’s NPS® score, likely due to the strong national infrastructure and marketing backing these companies have compared to the majority of The Alternatives providers. Ultimately, The Big Four subscribers believe that while their internet providers have larger infrastructures, which can be a positive asset in delivering the speeds they desire, they may lack in responsiveness to customer service issues.
The Alternatives group subscribers believe they will likely receive more responsive customer care but the perceived inherent smaller infrastructure may constrain their technology offering—they’re wondering if the company is going to be reliable and make their homes run seamlessly. That’s not to say The Alternatives subscribers don’t find responsive customer service or faster internet speeds important, but there is not another service attribute as critical as reliable service impacting their NPS® score. Reliability of service (e.g., few outages) is the most critical service attribute hurdle that The Alternatives group providers need to overcome to improve customer loyalty levels.
Applying Reliability to Your Marketing
Understanding what has the biggest impact on advocacy for The Big Four subscribers compared to The Alternatives subscribers has big implications on your marketing planning in 2018.
With 97% of The Alternatives respondents agreeing that reliability of service (e.g., few outages) is an important attribute when choosing and comparing home internet providers, reliable service needs to be a core message for any marketing efforts. Built into this message should be the secondary theme of how reliability makes your home run seamlessly. The beauty of seamlessness is that it is highly emotional and speaks to how much our home lives are driven by reliable internet service. Another positive of this attribute is that it is not associated with a negative issue like customer service is for The Big Four group.
In 2018 and beyond, The Alternatives home internet providers can empower their marketing mix with messaging strategies built around the importance of reliability. Be sure to stay tuned for our next home internet survey blog post next month.If you would like to discuss these findings please feel free to contact us directly.