Market Channels Strategy: Verizon Wireless FiOS

New Target Market – The middle class, high class, students and the youths

Marketing channels entail a myriad of activities or practices that are essential for transferring ownership of services from the production point to the point where they are consumed (Stern, 2013). In other words, they are ways that producers or manufacturers use to get their products or services to the people who will finally use them. There are various marketing channels that are embraced during the transfer of goods and services. Companies can either use direct or indirect channels to deliver their products to customers. In this case Verizon Wireless uses a mix of alternative, indirect and direct channels to supply Verizon Wireless FiOS to its consumers. Through this service, the company is able to supply FiOS internet, FiOS TV and FiOS digital voice to its customers. In regard to FiOS internet, customers are required download a mobile on their phones or digital devices, which then provide them with a platform for subscription. Customers can, also, directly log into the company website, register and subscribe to various FiOS plans that suite their needs. Upon subscription, customers can have direct access to FiOS digital device, FiOS TV, and FiOS internet plans. The new target market for Verizon wireless FiOS comprises the middle class, high class, students and the youth. These four categories of the customers comprise the new target market. The mix of indirect and direct marketing channel for selling FiOS service will not change as a result of the new target market. It is the most efficient approach for the middle and the high class who want to catch to fast TV programs, students who rely on the internet to do their research, and for individuals who want to have fun by watching movies.

In terms of marketing channel strategy, the distribution intensity strategy that Verizon Wireless embraces for distributing FiOS service is mass coverage strategy, also, referred to as intensive distribution strategy. Through this type of marketing channel strategy, the company ensures that the service reaches all geographic locations that contain its target market. This strategy is well known in the company because of the way it utilizes a mix of distribution methods with the aim of increasing its customer base (Presutti, 2013). The direct channel of distribution that the company uses comprises of the company operated stores, the integral aspect of Verizon Wireless’s distribution strategy for FiOS service. Through the indirect distribution channel, the company uses retail channels that comprises of agents that sell both prepaid and postpaid FiOS service. The distribution intensity would not change for the new target since the company’s marketing objective is to acquire a large customer base for FiOS service.

In regard to the value chain, each member of the channel diagrams highlighted above plays a significant role. In regard to direct distribution channel, Verizon Wireless marks the start of the value chain as the producer of the service. It brings value to the customer by producing the service (FiOS service), which suits the various needs (FiOS digital device, FiOS TV, and FiOS internet) of customers. In regard to the indirect distribution channel, wholesalers, which comprise of different independent companies bring the service closer to consumers by buying and distributing data services, minutes and wholesale access to customers. The retailers who comprise of Target, Costco, Wa-Mart, and Best-Buy add bring value to the customers by selling prepaid and postpaid services to the final users.

In regard to pricing strategy, Verizon Wireless embraces premium pricing strategy on its products and services including Verizon Wireless FiOS. However, the company should embrace a lower-cost alternative such as bundle pricing in order to attract new clients and be able to maintain the new ones.

Scroll to Top