With the recent success of T-Mobile, it's hard to believe it wasn't that long ago that T-Mobile was left for dead - a deteriorating asset waiting for someone like AT&T, Dish or Softbank/Sprint to pick up. It was losing customers thanks to no iPhone at the time, and its network infrastructure was late to the LTE game. Today, T-Mobile is the number three wireless carrier in the US, having just surpassed Sprint in the number of subscribers. It's worth taking a look at what they did from a strategy and positioning point of view.
Why strategy and positioning? A company's position is tightly coupled with a company's strategy and operations. Without that tie, a position lacks credibility from the inability of a company to deliver on its promise. Comcast has announced that it wants to be a "customer-focused" company, but given its organizational structure and internal incentives to reduce churn, Comcast has thus far been incapable of delivering on that message. Customer focus is not in Comcast’s DNA.
When we help reposition companies, we use a Company DNA framework to assess its ability to deliver on its differentiation. In our collective experience, we have found that technology companies can be categorized in one of three ways — Product, Customer and Concept — and each can be differentiated in one of two ways.
- For a Product company, it's about features or value.
- For a Customer company, experience or segmentation.
- For a Concept, it's category creation or cult of personality.
All companies have aspects of these three categories, but only one can be a dominant personality. As a former client noted, DNA is the "first impression you give when you meet for the first time" (thanks Arkady).
T-Mobile decided that the only way it could win was by becoming a Concept company. In March 2013, T-Mobile launched its Uncarrier effort to position itself against the Big Two wireless carriers (Verizon and AT&T). The face of this effort is CEO John Legere, who has adopted a straight-talking customer hero persona that T-Mobile die-hards have embraced.
What's interesting is that T-Mobile executives made that conclusion earlier, but they didn't have the leadership with the right DNA to match until Legere took the job as CEO.
It was equally important to make radical changes to its products and services to credibly deliver on a Concept differentiation - no contract plans, unique phone payment plans, etc. These are changes that Verizon and AT&T had no choice but tofollow.
In many industries, but especially in tech, success is often times measured in marketshare. You could argue that if T-Mobile were really that successful, it should be #1 in marketshare, right? Actually, no. Concept companies are out there to change the world, and success is measured in how many believers you've acquired and what kind of outsized impact you've made to the world.
Has T-Mobile’s repositioning been a success? Absolutely.