Choosing a wireless carrier and making sense of the various plans available has long been a notoriously difficult process involving a frustrating amount of guesswork for customers. In this episode of Mastering Innovation on Sirius XM Channel 132, Business Radio Powered by The Wharton School, Miguel Quiroga, CEO of Visible, the all-digital wireless carrier created by Verizon, discusses the shift toward subscription models and startup mentalities designed to eliminate friction for customers in this space.
After two years of research on the industry at large, Verizon identified the need for a customer-centric business model that was entirely digital, rather than a retail-focused one in a physical storefront. Quiroga explained that despite creating more competition for itself with a separate carrier, the company evolved to match what the consumer wanted: a more direct, transparent experience. Unlike traditional startups, Quiroga observed, Visible has little room for beta testing or trial and error in a field where reliability and customer trust are paramount. He detailed new challenges and opportunities, such as engaging consumers without the conventional face-to-face interactions, particularly the less digitally-centric customers.
An excerpt of the interview is transcribed below. Listen to more episodes here.
Transcript
Miguel Quiroga: Fundamentally, we built Visible with one thought in mind. We looked at the data in the U.S., and over 60 million consumers switch phone service every year. When you think about that number, it’s incredibly staggering. If you look at the reasons and pain points as to why a consumer is moving around, it’s price, upselling, services we don’t need or understand, poor customer service and the time it takes to switch. Our opportunity is: we believe we can offer a simple, easy-to-use phone service experience that takes all that friction away. You can basically sign up and manage that service from the comfort of your home.
Nicolaj Siggelkow: You just explained some of the differences and pain points. There’s no yearly contracts. This is monthly contracts, correct?
Quiroga: That’s correct. There is no contract. Think of it more as a subscription type of model, as many tech companies have developed.
Siggelkow: Interesting. If I look at the Verizon website, and I also see $40 per line and unlimited plans, what’s the difference? Is it the contract length?
Quiroga: There are some differences in terms of this particular offering from us or anyone else in the industry. Fundamentally, because we are offering $40, it’s an all-in price point. There are no hidden fees. All taxes are included. That’s essentially the same price you see on your bill every single month. That’s particularly unique for our customers, presenting it in a way that’s directly to the consumers. We eliminate the store option in our business model because we feel that is something in this day and age that a lot of customers would value, and it is not necessarily required. We take the store option out of the equation, and we pass that value on. That’s essentially the basics of our business model.
Siggelkow: Good. Now, the key focus of the Mack Institute for Innovation Management here at Wharton is how large established firms can innovate. Clearly, Verizon is a very large established firm. I’d like to probe a little bit into the origins of Visible and how it was created. What’s the origin story of Visible? Who came up with the idea, or how did it get started?
“Customer centricity is the name of the game across any industry. For the wireless industry in particular, there’s a lot of opportunity to make things much better.” – Miguel Quiroga
Quiroga: It was two years of research into the whole industry and consumer behavior at large. That brought Verizon to a point where they thought, “We need to invest and incubate this type of startup mentality and enterprise within the core business.”
We’re headquartered out in Denver. We’re completely separate geographically from the core business of Verizon. The thinking behind this is: how do you actually innovate and insert yourself into a crowded market and make a difference? Customer centricity is obviously the name of the game for everybody across any industry, but for a business like the wireless industry in particular, there’s a lot of opportunity to make things much better. The challenge for any large businesses is how to do that at scale. What we’re finding is: when you build a business from the ground up, the tech stack, the people, the culture, the business practices, the way you make decisions, the way you iterate, they are fundamentally different when you start within a new business and a new brand. It’s something that we hold true to everything we do here at Visible and something that always helped us drive forward to be efficient and fast-market.
Siggelkow: Yes, every large organization struggles a little bit with how to do this. You’ve really chosen this idea of, “Okay, let’s create a new business unit.” Moving out to Denver, what was that decision like? Being away from headquarters, is this good, or is it bad?
Quiroga: It’s fantastic. Besides, we’re in a beautiful part of the country. You can see the mountains, and you get some amazing sunshine. What’s interesting about this process is you’re bicoastal. You can easily access both coasts – both the tech on the West Coast and all of the tech in the East Coast. There are some advantages there. An advantage with geographic focus is, you get to focus on the business, but still tap into what the core of something like a Verizon business is at scale. You get the best of both worlds. It’s something that also allows us to build a type of focus culture with one mission in mind: taking care of, innovating, and redefining the phone service category here in the U.S. That’s something that we’ve really been happy about: setting up a culture like this.
Siggelkow: Feel free to say, “I cannot answer this,” but I’m really intrigued by how large organizations overcome their innovation challenges. This is a bit of a radical solution, creating a separate business unit that can sometimes compete with the rest of the organization. I can imagine that not everyone was happy about this. What role did top leadership play in terms of who was behind this and said, “No, this is the way we need to go down this path. Yes, I know some people may be unhappy, but this is what we believe is right.” Where in the organization is this momentum coming from?
“It’s about presenting an offer into the market that tightly meets that particular segment.” – Miguel Quiroga
Quiroga: That’s a great question. What you’re describing is not uncommon, this topic of, “How do you do a startup type of model or even make critical decisions that drive innovation and change?” The way to think about this is that we, broadly across Verizon, understand that our business is evolving, and this was a way to focus on a very specific target demographic. Consumers are ultimately highly digitally-centric or want simplicity and ease of use. It’s really about presenting an offer into the market that tightly meets that particular segment and allows us to build the type of product experience we’re looking to achieve. It’s something that oftentimes, businesses have to do to stay the course. That’s why we are where we are and why we’ve come to market the way we have.
Siggelkow: Can you tell us a little bit about the timeline? You said you launched not that long ago. How long was it in-the-making before you really started going out into the market and ramping up?
Quiroga: Broadly speaking, it’s about two years between the research, the co-creation with customers, and the development process that was required to bring this to market. Building a culture is always an ongoing thing. What’s interesting for us, given our innovation mindset, is that our team dynamic is very specific. We’ve had a very nice blend of different industries and categories from small, medium, startup to tech companies. At the end of the day, it’s probably only 20% of the business that is pure telco, and that’s by design. It’s set up that way to force a type of disruption oriented toward simplicity. I’m not a biggest fan of using “disruption,” but as a way of being change agent in a very crowded market, I think that’s a good way to go.
About Our Guest
Miguel Quiroga is the CEO of Visible, the first all digital and app-based wireless carrier in the U.S. Backed by Verizon and designed with an innovative first to market technology model, Visible has no stores, no contracts, and speedy customer service. Under Miguel’s leadership, Visible is uniquely engineered to completely change and simplify the experience of consumers and revolutionize the mobile industry. He holds an MBA from Columbia University and a BS in Computer Science from The University of Texas at Dallas.
With over nearly twenty years in telecommunications, Miguel has led organizations and strategies in every layer of the industry, including wireless, wireline, and internet, all while maintaining the fine balance between profitability and customer satisfaction. During his tenure at Verizon, he served in a number of key leadership and executive roles, including Head of Customer Business Intelligence and Employee Experience. Furthermore, in his most recent role at Fios as the Vice President and Head of Digital, he re-wrote the playbook on designing innovative ways in which consumers can choose how they prefer to receive internet and cable services.
Mastering Innovation is live on Thursdays at 4:00 p.m. ET. Listen to more episodes here.