Verizon goes big with holiday promotions

Verizon is the standout in a new study of US wireless operator holiday smartphone promotions. Verizon is offering much more fetching offers this year than in previous years, a possible indication that Verizon is investing more heavily in gaining new customers.

"Broadly speaking, this year's promotions are similar to last year's," wrote the financial analysts at MoffettNathanson in a recent note to investors (registration required). "Verizon is the biggest exception, perhaps suggesting that they are feeling the need for an all-out push to deliver their numbers."

Indeed, Verizon has struggled to regain momentum in a mobile market where T-Mobile, AT&T and cable companies like Comcast and Charter Communications have been gobbling up most of the sector's new customers. In recent months though, Verizon has managed to make progress with new promotions and pricing strategies.

Verizon officials have promised that the operator will end 2024 with an overall increase in postpaid phone customers – after years of losses. "We will be postpaid phone net add positive ... this year," Sowmyanarayan Sampath, the exec in charge of Verizon's consumer business, said during the operator's recent quarterly earnings call.

To reach that goal though, it appears Verizon is offering steep discounts on popular smartphones in order to entice new customers to its network. Such holiday promotions are important because the fourth quarter is often the biggest shopping period of the year.

The numbers

"Verizon is in the market with much higher promotional values for switchers on entry-level Unlimited plans, and incrementally higher promotional values for upgraders on premium Unlimited plans, than in the year ago period," MoffettNathanson explained, citing data from Navi, which tracks pricing and promotions in the wireless industry.

Specifically, Verizon last week raised the maximum amount it would offer new customers for their old phone trade-ins from $830 to $1,000 for iPhones and from $800 to $1,000 for Androids, as long as those customers selected Verizon's Unlimited Plus plan. And for new customers opting for its Unlimited Welcome plan, Verizon raised its maximum trade-in amount from $415 to $1,000 for iPhones and from $400 to $1,000 for Androids.

Those aren't Verizon's only promotional offers. But they indicate Verizon's interest in offering steep phone discounts to customers who might be shopping for a new phone and who are willing to trade in their old one.

"Verizon’s offers are now – by some distance – the richest in the market," the MoffettNathanson analysts wrote.

No need for an old phone

One other new trend noted by MoffettNathanson is US operators' general interest in promotional pricing that does not require a customer to trade in an old phone.

Generally, Verizon, AT&T and T-Mobile have all tied their smartphone discounts to the requirement that a customer trade in their old phone. That way, the carriers can sell that old phone and recoup some of their investment.

But some new promotional offers from Verizon, AT&T and T-Mobile don't require customers to supply an older phone that they no longer want.

"Verizon dipped its toe into the water last year by offering switchers up to $830 off the iPhone 14 series (then a year old) without a trade-in," noted the MoffettNathanson analysts. "This year, not only do they have similar offers on the now year-old iPhone 15 series, but they’ve expanded their offers to include up to $660 off the newest iPhone (the iPhone 16 series) for customers without a trade-in on entry Unlimited and up to $1,020 for customers on premium Unlimited."

The analysts noted that AT&T and T-Mobile have followed Verizon's lead with their own no-trade-in offers.