Introduction
Verizon is a multinational telecommunication company that operates in the B2C ecommerce industry. It deals with a portfolio of customer-centred products and services such as business 5G devices, smartphones, and internet dial services. Most of its services are offered online through the online retail platform and Verizon Wireless. Since Verizon operates in a competitive market, it is affected by various factors and forces within the industry. Due to such factors, it has to harness strategic measures to ensure it gains a competitive advantage against other players in the telecommunication industry. Competitive advantage is attained through Verizon’s core competencies, resources, and capabilities, which will be analyzed in the paper. Moreover, the paper will analyze corporate and Business-Level strategies that respond to the challenges of B2C ecommerce locally and internationally.
Body
Factors and Forces of B2C E-commerce that Affect Verizon
Various micro and macro-environmental factors affect Verizon’s operations. They include technological factors as the company operates in a dynamic environment. Technological advancement has negatively affected Verizon Company, forcing it to adapt accordingly. For instance, a shift by competitors to 5G networks significantly reduced its market share and increased the competition rate. Besides, technological advancement comes with its demerits, such as cybercriminals and hacking. According to Crawley (2020), the hacking of the Verizon system led to a massive data breach where criminals accessed confidential customer data. The cyber criminals’ attack on its system significantly reduced customer trust in the company. Most loyal clients shifted to competitors who assured encryption of their data and ensured that third parties could not access it. The changes in technology have also shifted customer preferences. Therefore, Verizon Company should invest in technology safeguarding customer data to stay relevant.
Additionally, the changes in laws and regulations directly affect Verizon. The rise of customer movements and legal policies safeguards customer protection. The changes in regulations have forced the company to adhere to the rules. In 2014, Verizon Wireless faced a legal suit and was forced to pay $64M as it overbilled the family calling plan (Goldstein, 2014). The lawsuit tarnished its reputation as it was branded an expensive company that overprices its customers. Besides, it led to financial loss due to compensation according to the customers. Verizon should be at the forefront of protecting customer rights and complying with the laws and regulations.
Furthermore, Verizon operates in a competitive environment which significantly affects its operations. The telecommunication industry is highly competitive with players such as TELUS Mobility, Vodafone, and Airtel. Each company has unique measures that it utilizes to compete, and thus Verizon should conduct competitors’ analysis to ensure that it stays ahead of other players in the industry. All players in the industry compete for the same market, and thus Verizon should enact measures to ensure it expands its market share by serving more customers. For example, Verizon has invested in network quality and coverage, which has attracted more customers.
Various economic factors affect Verizon’s operations. During covid19, most customers had less disposable income due to the closure of companies and loss of employment. It greatly affected Verizon as it decreased its sales as customers needed more income to dispose of in subscribing to Verizon products and services. However, post covid19, the pandemic; most countries are opening their economies for trade, symbolizing that customers have more income to dispose of. Besides, in developing economies, most customers have higher disposable income posing an opportunity for Verizon to diversify its operations. Furthermore, developing countries have a high economic growth rate, a crucial opportunity for Verizon. Therefore, the stability of an economy directly affects the operations of Verizon.
Changes in customer expectations affect Verizon Communications’ operations. Customers require high-quality products and services, such as a wireless connection with higher bandwidth, to offer a seamless experience. The needs of customers are changing and thus require Verizon to change accordingly. For example, customers prefer personalized recommendations on the website and apps to ease decision-making. Therefore, Verizon should monitor and understand customers’ purchasing patterns to make precise recommendations. It will be instrumental in exceeding customer expectations and thus gaining more loyal customers.
Actions to Sustain Verizon’s Competitive Advantage
Verizon should invest in technology to gain deeper customer insights. For example, they should invest in artificial intelligence, machine learning, and data analytics. The advanced technology will be instrumental in understanding customers’ purchasing patterns and behaviors to offer recommendations to customers. Moreover, the advanced technology helps to create a seamless customer experience by offering fast order processing and guiding customers to create easy navigation, especially in the apps and websites. Therefore, more customers will be satisfied, increase the number of customers and thus gain a larger market share than competitors.
Additionally, to sustain competitive advantage, Verizon should continuously engage in innovation. For instance, they should create unique products that competitors cannot imitate. Besides, Verizon should make customer-specified products that stand out against competitors. Besides, Verizon should explore new markets, especially in growing economies with a large customer base. Diversification helps eradicate the saturated U.S. market and has branches overseas in developing economies. The innovation may involve combining different technologies, such as augmented reality and voice commerce, making the company unique.
Furthermore, Verizon should form strategic alliances with other companies in the same industry to reduce competition. It will help them to combine resources such as technology and finances to gain a larger market share. Verizon has partnered with companies such as T-Mobile and T&T (www.verizon.com, 2023). The alliances occur in logistics and processing payments, which are crucial to Verizon’s success. Similarly, Verizon should continuously promote its products through advanced platforms such as Search Engine Optimization and social media to boost customer awareness and attract more customers. Besides, Verizon Communications has partnered with advertising agencies such as New York and Draft Worldwide to advertise on their behalf. Promoting products and services offered by Verizon helps reach more customers and gain a larger market share.
Essential Resources, Capabilities, and Core Competencies Available for Verizon’s Competitiveness
Verizon has retained its brand image for an extended period. It is a renowned brand locally and internationally for its high-quality products and services. It has been crucial in leveraging customer trust and loyalty due to its consistency in the industry. According to its website, the company is known for having the most reliable 5G network, its sustainability and digital inclusion, and embracing diversity and inclusion in its service delivery. According to (Hemlin, 2023), Verizon Communication has been awarded 30 times for Wireless Network Quality based on J.D Power results. Therefore, it has been competent in meeting customers’ needs leading to the rank as the best telecommunication company.
Moreover, Verizon Communications has a solid customer base. Statista says it has 143 million subscribers that can easily be converted to loyal customers. Therefore, it has an already established audience that can be used to drive online sales. Therefore, being an already established company symbolizes that its brand is already accepted by many customers who buy its products and services. Besides, having an online presence using different channels helps reach out to more customers leading to brand awareness.
Furthermore, Verizon Communications has a technological advantage over competitors. The company stays updated on market trends and the needs of the customers contributing to its competence. It was the first company to launch a 5G network in the United States which boosted user experience. Besides, it has technological infrastructures such as artificial intelligence, which contribute to its success and reduces competition with other players in the industry. Therefore, having technological expertise ensures that they maintain an online presence. For example, using artificial intelligence to provide 24/7 customer services and facilitate order processing.
Similarly, Verizon Communications manages a wide range of customer data accessed through online transactions. The data comprises customers purchasing behaviors which are crucial in gaining insights into their needs. Therefore, through data analytics, Verizon makes strategic recommendations on customer preferences that facilitate purchasing. Besides, by analyzing customer data, Verizon can acquire a wide range of information and thus make rational decisions concerning customer needs and purchasing patterns. However, the company is very cautious in ensuring encryption to prevent third parties from accessing customer data (Pearlson et al., 2022). Besides, they have enacted strict measures to prevent data breaches that might harm customers and the company.
Strategic Recommendations
Verizon should be customer-centric by prioritizing the needs of the customers. The company should implement policies that would boost user experience, such as faster order processing, personalization, and creating different channels to communicate with customers. For example, the website should have an icon where customers can air their grievances and complaints and should receive prompt feedback on their concerns. Besides, Verizon Communications should invest in advanced technology to ensure faster payments. It should also promote usability by offering recommendations to customers based on their purchasing patterns. Therefore, any customer issue should be treated with urgency, increasing the number of customers and thus sustaining competitive advantage.
Moreover, Verizon Communications should partner with other companies in the same ecosystem. The alliance should be strategic, thus offering an advantage to Verizon. For example, an alliance with logistic companies will ensure prompt deliveries, while a partnership with financial companies will offer prompt processing of payments. The alliances will increase the number of customers due to a seamless customer experience. Besides, the partnership should be in strategic areas where competition is high, which will reduce the level of competition and increase its competitive advantage. Hence, a preliminary analysis should be conducted on a possible partnership by gauging its advantages and disadvantages to ensure that Verizon benefits from such alliances.
Additionally, Verizon Communications should be involved in continuous innovation. It can be done through research and development to develop new products and services. Besides, it will help stay ahead of the competitors by discovering new markets and products to help solve customer needs. Verizon should hire creative and highly motivated individuals to help realize its mission and vision. The company should explore new markets with minimal competition, such as developing markets to offer markets outside saturated U.S. markets. Moreover, they should continuously develop the existing technology to stay ahead of others. For example, they should innovate a more advanced 5G or 6G network before other companies. Therefore, Verizon Communications will retain a competitive advantage over other players in the same market.
Verizon Communications Corporate and Business-Level Strategies to Respond to B2C Ecommerce Challenges
Corporate-Level Strategies
Verizon has adopted various corporate-level strategies to deal with challenges in B2C ecommerce. It has undertaken vertical integration through the acquisition of other companies. According to Sikka (2021), Verizon has acquired AOL and Yahoo to gain an online presence through video advertisement. It aided in increasing its online presence through advertisement and digital platforms. Besides, it has helped Verizon to offer digital products and services that suit different customer needs. The acquisition helped Verizon control its online activities, boosting its revenue and reducing competition. It helped solve the challenge of advanced technology and a shift to online business in B2C ecommerce.
Furthermore, Verizon Communications forms strategic alliances with other firms. The alliances ensure that it offers a competitive advantage in the industry. For instance, Disney Bundle’s development arose after Verizon and Disney’s partnership to provide streaming services. It helps Verizon to serve more customers and increase its product offering. It has been instrumental in boosting competitiveness in the ecommerce market. Similarly, Verizon has diversified its operations by exploring new markets and developing new products. Besides, diversifying its marketing channels has shifted the traditional way of doing business to modern ecommerce business. For example, a shift from T.V. advertisement to digital channels such as social media platforms. Hence, through diversification, it has adapted to the dynamic B2C market.
Business Level Strategies
Verizon has adopted a differentiation strategy by offering premium products to its customers. It offers a seamless customer experience through the internet with high bandwidth and unique mobile devices. Therefore, it has differentiated itself from competitors by offering a premium brand unique to the company. Premium products and services are charged slightly higher prices and offer the best services. It helps to eradicate the problem of extreme competition in the B2C market. Therefore, the differentiation strategy helps customers to distinguish it from other players in the same industry.
Moreover, Verizon Communications conducts its business through an Omnichannel strategy. It uses numerous channels to ensure customers can access its products and services. For instance, they have brick-and-mortar stores and online platforms (Sherovska & Petrovska, 2021). The combination caters to different customer needs by providing a variety based on their preferences. The strategy ensures that it takes care of customers both locally through the stores and internationally through online platforms. It helps resolve the problem of dynamic customer needs by providing traditional and modern business methods.
Finally, Verizon Communications uses a customer-centric strategy by targeting different customers. Their network plans target customers in the same or different segments by tailoring their products to meet customer needs. For example, the network plans for families is different from business one. Therefore, segmenting customers based on their needs and preferences helps Verizon to serve a range of customers and increase its market share. It helps resolve the problem of intense competition and changes in customer tastes and preferences. Hence, the company stands out against competitors and gradually gains market share by serving more customers.
Reference List
Crawley, K. (2020). Deep Dive: Verizon 2020 Data Breach Investigations Report. [online] SpyCloud. Available at: https://spycloud.com/blog/a-deep-dive-into-the-verizon-2020-data-breach-investigations-report/ [Accessed 6 Apr. 2023].
Goldstein, P. (2014). Verizon will pay up to $64m to settle lawsuit claiming it over-billed for Family calling plan. Fierce Wireless. Available at:https://www.fiercewireless.com/wireless/verizon-will-pay-up-to-64m-to-settle-lawsuit-claiming-it-over-billed-for-family-calling. [Accessed 6 Apr. 2023].
Hemlin, I. (2023). For the 30th time in a row, customers make it clear: Verizon is unmatched in Network Quality. [online] www.verizon.com. Available at: https://www.verizon.com/about/news/30th-time-verizon-unmatched-network-quality [Accessed 6 Apr. 2023].
Pearlson, K., Schwartz, J., Sposito, S. and Arbisman, M. (2022). How Verizon Media Built a Cybersecurity Culture. MIS Quarterly Executive, pp.165–183. doi:https://doi.org/10.17705/2msqe.00064.
Sherovska, G. and Petrovska, I. (2021). The Future of the Retail Industry by Implementing Omnichannel Marketing Strategy in the Republic of North Macedonia. International Journal of Academic Research in Business and Social Sciences, 11(8). doi:https://doi.org/10.6007/ijarbss/v11-i8/10450.
Sikka, P. (2021). Why Verizon Needed to Diversify Its Wireless Business. [online] Market Realist. Available at: https://marketrealist.com/2016/09/verizon-needed-diversify-wireless-business/[Accessed 6 Apr. 2023].
www.verizon.com. (2023). Company Awards and Recognition. [online] Available at: https://www.verizon.com/about/our-company/awards-recognition/ [Accessed 6 Apr. 2023].
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