Verizon will use Lady Gaga as the centerpiece of its new rewards program, offering wireless customers a chance for free tickets to the iconoclastic rock star’s U.S. concert tour.
The tickets, and an even smaller number of backstage passes, will be offered starting this week via the carrier’s new rewards program app, called Verizon Up, which seeks to simplify giving benefits to participants and focus the very best offers on Verizon’s best customers. At the shows, Verizon customers will even have their own special seating section.
Only a limited number of tickets will be given away, and participants will have to compete against each other for them at designated times in the rewards app.
Other rewards will include tickets to NFL games and other major events, as well as lesser items such as several free months of Apple’s (AAPL) Apple Music or HBO Now, or 20% off a return flight on JetBlue (JBLU). Starbucks (SBUX) and Panera Bread (PNRA) are also partners.
“At a basic level, it’s all about thanking customers for their business,” Diego Scotti, Verizon’s chief marketing officer, tells Fortune.
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“Definitely there are going to be some of those rewards that are more scarce than others, and that’s part of the premise of it,” he explains. The most exclusive rewards will be more likely to be offered to a more limited group of people. “If you’re a customer that’s been with us 10 years and has 10 lines with us, for example, you should be treated differently than a customer that just joined,” Scotti says. “Not that we don’t treat all of our customers in the same way, but we want to recognize that longevity and that commitment to us.”
Verizon has been locked in an increasingly fierce battle for mobile customers over the past year amid the return of unlimited data plans, considerable price cutting, and frequent free smartphone offers (although the carriers have been in a bit of a lull recently). T-Mobile revamped its rewards program last year, giving away small items like free pizzas and movie tickets to all participating customers once a week. Verizon has battled back with its own unlimited data plan that it introduced in February and now plans to overhaul its rewards program, too.
But Verizon’s approach will almost be the opposite of T-Mobile’s (TMUS) plan. Instead of constantly giving away three or four low-cost items every week, Verizon will require that participants first spend $300 in wireless billing, excluding fees and taxes, for each reward. Once the $300 level is hit, customers will be able to choose from one of six customized rewards offered based on their interests, prior selections, length of time as a customer, and other factors, Scotti says. Customers don’t accumulate points—every time they hit the $300 mark in spending, they are given a reward.
Instead of choosing a reward, customers can also “bank” their $300 reward credit as a $10 discount off a future device purchase. Customers can accumulate multiple $10 discounts, up to $240.
Some prizes will simply be made available unconnected to the spending as “unexpected rewards” via Verizon’s apps.
Privacy questions
And then there is the privacy issue. Even before the official start of the program, tech news site Ars Technica reported last week that participating customers would be required to opt into a data collection program called Verizon Selects that includes keeping track of web browsing history, wireless device location, email address, and other personally identifiable information. Customer tracking is done in part with a controversial software identifier that Verizon inserts into a customer’s online activity known as a “Unique Identifier Header,” or sometimes called a “super cookie.” The company was fined $1.4 million last year for using super cookies without disclosing it to customers.
But Scotti says customers will be able to opt out of tracking. “For us, privacy is really, really important,” Scotti says. Customers will have “choice and control,” he says, and will be able to decide not to allow Verizon to collect their personal tracking data. “If you sign up to the Up program and then you say ‘you know what, I don’t actually feel very comfortable with you having this data’ you can actually opt out and still be in the program.”
At least at the start, Verizon (VZ) isn’t tying the wireless rewards program to any of its other offerings, by counting spending on FiOS TV and Internet service or classic telephone lines, for instance. AT&T’s (T) best promotional offers link its services, as unlimited plan wireless customers get $25 a month off any of its video services including the online DirecTV Now app.
Verizon’s solo focus on wireless will likely change down the road, Scotti says, though he’s not revealing any timing or details. “This is probably the first step in terms of our strategy to recognize our customers,” he says. Being able to include other kinds of Verizon services in the rewards program is “definitely very front and center of what’s coming.”
(Update: This story was updated on Aug. 7 to correct that the $10 device discount must be chosen in lieu of a reward and that any customer could win a backstage pass prize.)
