Illustrator Dennis Balogh

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Ivan Seidenberg

How can companies attract and retain customers?

Ask Ivan G. Seidenberg, chairman and CEO of Verizon Communications Inc. (VZ), about the global economy and he’ll predict sluggishness until companies have the confidence to start hiring and consumers begin to spend freely again.

But Seidenberg, who is also chairman of the Business Roundtable, an association of CEOs of leading U.S. companies, doesn’t worry about prospects for the telecommunications industry — or for long-term international growth. “Global businesses are looking at information and communications technology as a way to permanently change the way they do business, making themselves more efficient and environmentally friendly,” he says. “When it comes to the consumer market, the appetite for more bandwidth, more mobility and more ways to manage digital content is growing faster than ever.”

To put it another way: “In an industry changing as fast as ours, 90 percent of our growth opportunities are ahead of us,” says Seidenberg, 63. “That’s why innovation is the lifeblood of our business.”

“If anything has changed overall, it’s that we’re increasingly focused on the total value proposition.”

Verizon’s game plan to attract and retain customers is simple, according to Seidenberg: to create a reliable network that allows customers not just to communicate but also to access all of their digital content, from any device, wherever they happen to be. “The company that can help the customer manage that entire digital environment — or, to use the buzzword, ecosystem &emdash; has a real advantage in the marketplace. It all comes down to investment, innovation and service — just as it always has,” he says.

“On the larger scale, America’s telecom companies invest more in networks every year than the federal government invests in transportation,” Seidenberg said at a recent conference. Investing in the network, he adds, allows Verizon to build on innovation that goes well beyond the ability to support exploding levels of data and video traffic.

“Our new 4G wireless network will embed connectivity into all kinds of physical objects, which will allow you to control energy use, security systems, even home appliances, from wherever you are,” Seidenberg says. He talks of putting various applications in the “cloud” and offering professional services to help global companies manage their operations more efficiently. “We’re using our technology to help create a smarter society through things like electronic medical records, smart grids and other energy-saving technologies, medical imaging and the like,” he explains.

To attract customers, Verizon is also being bold in marketing the value of its networks. “We’re pretty aggressive, and our marketing spend has been fairly consistent,” the CEO says. “If anything has changed overall, I think it’s that we’re increasingly focused on the total value proposition. We’ve never competed exclusively on price, but now it’s even more crucial that we have bundles and usage plans to fit different customer needs, and a diverse mix of devices and applications that can be tailored to the individual.”

As for retaining customers, Seidenberg says, the key is to make them aware that Verizon will continue to deliver more value to them over time. “So when you sign up for FiOS [Verizon’s bundled communications service for Internet, phone and television], for example, you have confidence that our list of on-demand videos will grow, that we’ll keep developing new ways to integrate home networks, that we’ll attract more and better content, and so on,” he says. “Same with wireless, as we expand our portfolio of devices, continue to make network improvements and provide more ways to access content; and same with the large business market, as we organize ourselves around helping our customers get the most from their technology investments.”

As the digital universe becomes more complex, he says, “we’re developing more and more tools for keeping customers’ data safe and secure and their privacy and personal information protected.” The bottom line, he adds, is that “it’s about developing a long-term relationship with customers based on trust and record of service.” — Sharon Kahn