"Why Indian Telecom Companies Struggle to Build Brand Loyalty in the 5G Era"

Telecommunication companies in India are racing to leverage 5G networks, hoping to revolutionise their business. Yet, despite offering unlimited free 5G data, they are struggling to monetise this next-gen technology. While 5G services are available to customers essentially for free, the technology hasn't yet created the excitement or demand that many expected.

One of the main reasons for this lukewarm reception is the way customers perceive each generation of mobile networks. Most people view new mobile technology as an extension of the previous version, which means they don’t see 5G as radically different from 4G. According to the diffusion of innovation theory, new technologies should attract eager adopters—yet, in India, 4G customers don’t seem overly enthusiastic about switching to 5G. The big question is: why?

Over the past decade, connectivity has grown in importance, but the telecom industry has seen a steady decline in average revenue per user (ARPU), especially when adjusted for inflation. Consumer connectivity revenues are projected to remain flat shortly, indicating that telecom companies will struggle to drive growth through traditional recharge revenues alone.

Although the market for 5G-enabled solutions is expanding, adoption remains slow. Telecom operators can still generate revenue by providing connectivity, but this isn’t expected to be the primary driver of future growth. Connectivity alone is likely to become stagnant, offering no significant growth opportunities. So, why are connectivity customers hesitant to embrace 5G-enabled products, even though the demand exists?

The answer lies in E.M. Rogers' "Diffusion of Innovation" theory. This theory suggests that Early adopters—about 3.5% of customers who are Innovators and 13.5% who are early Adopters—will naturally gravitate toward new technologies, regardless of brand loyalty. However, the real challenge lies in convincing the Early majority and late Majority, whom each make up about 34% of the customer base. These segments, which drive the majority of market share, require a strong emotional connection to the brand before they’re willing to adopt innovations.

Currently, Indian telecom companies lack the kind of "Brand pull" needed to attract these customers. Take Apple, for example. When a new iPhone is released, 80% of existing users upgrade, even though the improvements might be minimal. This is because people associate the Apple brand with a sense of status and personal elevation. In other words, customers aren't just upgrading their iPhones—they're upgrading themselves. This kind of emotional attachment creates brand loyalty, something Indian telecom companies have yet to establish.

The same can be said for other iconic brands like Harley-Davidson or Royal Enfield. These brands evoke powerful emotions, such as a sense of strength or adventure, which compels their customers to stay loyal. In contrast, Indian telecom companies are still focused on selling products rather than building brands that resonate emotionally with their customers.

To build strong brand loyalty, telecom companies need to shift from product-focused marketing to creating a brand identity that resonates with customers on a deeper level. People don’t just buy products—they buy emotions. A strong brand makes customers feel secure, connected and accepted.

For instance, Apple gives users the feeling of upgrading their status. Harley-Davidson, on the other hand, appeals to a sense of machoism, while Royal Enfield evokes the image of rugged masculinity. Telecom companies in India must strive to build similar emotional connections with their customers. Otherwise, they will struggle to push customers from 4G to 5G, and eventually, from 5G to 6G.

Building a brand in the telecom industry involves a comprehensive plan that defines how 5G products are positioned, communicated, and perceived in the market. Here are some key components that telecom companies need to focus on to build a successful brand:

1.????? Brand Purpose and Values: This defines the “why” behind the brand. It articulates the company’s mission, vision, and core values. Telecom companies in India need to work on defining a brand purpose that goes beyond profits and resonates with their customers.

2.????? Target Audience: Understanding the specific group of consumers the brand intends to serve is crucial. Companies need to identify the emotional needs of their target audience and craft messages that resonate on a personal level.

3.????? Brand Positioning: This differentiates the brand from competitors. Telecom companies need to establish a unique selling proposition (USP) that makes them stand out in the market, something they have yet to achieve.

4.????? Brand Messaging: A clear, consistent message is essential. Telecom companies should craft stories that go beyond their products and services, tapping into universal values and emotions that appeal to a broad audience.

5.????? Long-Term Vision: Building a brand is not just about immediate success—it’s about creating a brand that stands the test of time. Telecom companies need to think about how their brand will evolve with technological advancements, like the transition from 5G to 6G.

In conclusion, telecom companies in India must move beyond simply selling products. They need to develop a brand strategy that fosters emotional connections with their customers. By doing so, they will be better positioned to take advantage of future technological innovations like 5G and 6G, while securing long-term success in a dynamic and ever-evolving industry.