How carriers are finding new ways to monetize and retain users — and what that means for advertisers

What many carriers have done to retain existing users is to bundle mobile services with other subscriptions, such as Netflix and Disney+. Others focus on highlighting 5G capabilities to attract users looking for superior speed. 

With the shift to all things digital — and the growing interest in the metaverse — more companies are focusing on creating a robust interconnected experience for their customers.

A glimpse at current monetization strategies and potential innovations on the horizon 

Currently, most carriers are opting to partner for content to attract new and retain existing customers for more premium plans. For example, Verizon offered access to Apple Music and Disney+ in some of its mobile plans, while T-Mobile offered Netflix and a year of Apple TV and Paramount+ for customers that selected its service. 

However, with so many deals available, the competition for monetization in this way is becoming crowded. Carriers are turning to other ways to diversify their offerings to stand out among their competitors. For example, McKinsey has highlighted several innovations on the horizon for user monetization, such as prompting customers to make impulse purchases to upgrade their network performance whenever they prefer, rather than doing so each month. Other potential innovations McKinsey highlights include selling 5G-enabled experiences such as AR gaming, VR entertainment, smart stadiums and more. 

Another approach is using partnerships to deliver 5G-enabled experiences for a seamless customer experience. McKinsey found that 74% of customers indicated they’d prefer to purchase a 5G connection from a gaming app rather than their mobile provider. 

A partnership with a popular online game could be more efficient than charging for 5G on its own. And carriers may even embed 5G into partners’ apps to essentially act as a wholesale provider for 5G connectivity and expand their potential customer base. 

Unique incentives like these are more in line with the growing digital world and the increasing interest in the metaverse. As more companies create digital experiences and embrace the metaverse lifestyle, the advertising opportunities for marketers will become more expansive and more interesting.

Crafting a variety of monetization strategies is essential to retaining and attracting users. For many advertisers, these opportunities are rare and often limited-time, one-off opportunities to gain new customers via these partnerships. Many carriers are opening opportunities within the content delivered on devices through news, weather, notifications and enabling personalized set-up experiences via technology partnerships. 

However, as more consumers note the advertising programs to which many users are automatically added, sentiment is often divided over what is the right approach. To guard against the kind of rejection that automatic opt-ins can create, programs such as Verizon Selects and AT&T’s Enhanced Relevant Advertising require an opt-in — and collect less personal and detailed information.  

The balancing act is always essential, and the chief media officer at a CPG company, in a recent Digiday article, said, on the condition of anonymity, “To be honest, this is something we need to navigate carefully, so we’re going to step forward slowly on this one. We need to take our time to digest the decisions being made and potentially the reaction from legislators. There’s just so many shades of gray at the moment.”

Retainment strategies: From subscription bundles to additional services

For some carriers, it’s becoming increasingly apparent that mobile devices are turning into the primary screen rather than the second screen. Still, there is some interplay and connectivity between mobile and TV that they can capitalize on and that advertisers can as well. 

“The TV is normally the second screen as the mobile device is more communicative with consumers,” said Britany Scott, vice president, East and Central at AdColony. “They have the opportunity to communicate back with that device, which is the kind of connection I think that trumps anything else going on. It doesn’t matter that the phone is so much smaller than the TV screen. You can react and interact with it, so it definitely takes dominance.”

With the relationship between mobile and TV evolving — and sparking a debate over which device is the second screen — it’s causing some companies to adjust their business models. For example, T-Mobile is branching out into TV, and Spectrum is beginning to offer mobile service.  

“TV is never going away,” said Scott. “It’s always going to be tried and true. They’re definitely going to be a staple when it comes to media. I think what advertisers have to think about is what people are using it for and how people will engage with it. For a reactive situation, mobile is great. But there’s a huge opportunity to connect those devices. Consumers are using TV differently, so marketers need to use those viewing habits and how users are choosing to interact with their TV screens to their advantage.”

As carriers continue to branch out service-wise and update options for advertisers, marketers should see an uptick in opportunities. While carrier monetization strategies haven’t always been ideal in the past, many innovations on the horizon could open up the floodgates for marketers soon, leading to a more connected digital ecosystem. 

Sponsored By: AdColony