The latest moves by AT&T and Verizon Wireless highlight a growing trend among wireless carriers to aim advertising and marketing messages for services squarely at the specific age groups who use them. These segments won't generate big bucks, but analysts say carriers will continue to target specific markets on the advice of equity investors who demand to see sustainable wireless subscriber growth.
An estimate that now puts a cellular phone in the hand of more than 80% of every man, woman and child in the United States has elbowed carriers into targeting age-specific markets more aggressively. "The low- and high-age demographics are less penetrated than other segments," says Christopher King, senior telecom services analyst at Stifel Nicolaus & Co., Baltimore. "You've also seen an increase in the number of advertisements for prepaid phones, as well as texting services specifically targeted at today's youth."
Verizon Wireless, Basking Ridge, N.J., introduced America's Choice 65 Plus calling plan aimed at consumers ages 65 and older. Two plans are available. The Single Line Plan includes 200 anytime minutes and 500 nights and weekend minutes for $29.99 per month. The two-line plan offers 450 shared anytime minutes and 1,000 shared night and weekend minutes for $59.99.
San Antonio, Texas-based AT&T reached out to parents with young children who must have the latest cellular phone with a service that lets mom or dad block text messages and calls to and from specific numbers or during certain times, too, such as when kids are at school, during afternoon study times and certain hours at night.
The phone service called Smart Limits lets mom and dad log on to a Web site and choose functions that ensure kids can't call friends when they should be studying or in bed. Parents also can filter access to content, such as chat, dating and game Web sites.
As carriers look for specific markets and age groups to offer specialized services to, better wireless handsets and faster data services will prompt marketing and advertising targeted toward subscribers with voice plans, says Tim Horan, communications analyst at CIBC World Markets.
Most data services still target small and medium-size businesses, but more will attempt to attract consumers between the ages of 20 and 45 who own handsets like Research in Motion's BlackBerry, Apple's iPhone, or Palm's Treo. "Data will contribute between 35% and 40% of revenue within the next three to four years," says Horan. "Wireless revenues from data services have doubled in the last 18 months."
CIBC World Markets estimates data services will contribute $25 billion in revenue to the $150 billion garnered from wireless subscriptions in 2008--up from $21 billion and $140 billion, respectively, this year.