Verizon is building out its advertising business with a new loyalty program that gives the carrier access to subscriber data, The Wall Street Journal reports.
The program, called Verizon Up, gives subscribers credits that can be redeemed for access to movie premieres, concert tickets, as well as phone upgrades — as long as consumers agree to share their web-browsing history, app usage, and location data with the wireless carrier.
Verizon’s current ad business pales in comparison to Google or Facebook's. The wireless carrier generates around $7 billion a year through digital advertising, according to The Wall Street Journal, which would represent roughly 6% of its $126 billion in consolidated revenues generated in 2016. Google and Facebook generated over $37 billion and $14 billion in US ad revenue in 2016, respectively, in comparison.
Verizon’s advertising push can help offset losses from other struggling business units, but the loyalty program may be a tough sell:
Growth in digital ad revenues can help offset losses associated with a lagging wireless business. Verizon’s wireless revenue fell 2% year-over-year (YoY) to $21 billion in Q2 2017, despite Q2 2017 being the first full quarter Verizon offered an unlimited data plan. A growing advertising revenue stream can provide some financial cushion as the carrier looks to get its wireless business back on track. Verizon’s advertising push is timely, as Verizon recently acquired Yahoo’s core internet assets, and data collected under the new loyalty program will be shared with Oath, its new media unit created under the deal. Verizon will be able to leverage Oath media properties, including TechCrunch and HuffPost, as well as consolidated ad tech offerings in its pitch to marketers.