The telecom providers usually have followed a rise trajectory previously decade through rise in subscriber base along with adding considerable numbers on their annual revenue. They have got kept the interest rate together with the competitors and possess literally game with great results during the past. However in the recent times, they’re facing with an enormous challenge of adaptation to the matured, highly penetrated markets coupled with global recessionary effect. Therefore, a shift in paradigm to adapt their business models to the scenario is highly required and also the necessity of the hour is the customer experience management to accomplish a greater retention ratio.
Challenge in modern telecom industry – Customer retention
Nowadays in this day telecom industry that has attained high penetration level, obtaining a customer is getting even costlier. Industry analysis claims that only 25% in the acquired customers keep with the company after an year’s some time and while on an average only 20 -30% in the entire customer base is revenue earning/profitable customers. This dugs an in-depth hole from the balance sheet with the telecom service providers. As a result of churning aftereffect of absolutely free themes, there’s a huge imbalance created in gross additions from the customers and net addition.
Forward path: Way to customer retention – Customer experience management
Therefore, the most important challenge for the telecom operators around the globe is managing customer churn. It affects profitability of the company if your customer churns before the company can earn back an investment it incurred in acquiring the customer. Therefore, it is rather essential to indentify the profitable customers and retain them.
Retaining the profitable customers includes 2 steps:
1. Identifying the revenue earning customers from the entire subscriber base
2. Managing the customer experience and customer value for the revenue earning customers
Identifying the Revenue earning customers
The telecom agencies must define their business logic for identification in the revenue earning customers, for instance: the shoppers with usage more than ARPU are classified as high valued customers, or even in case of pre-paid, customers recharging a lot more than INR 250 each month (In Indian scenario) are thought as revenue earning. Depending on the business rules the complete usage has to be segmented into revenue earning customers and non-revenue earning customers. Managing customer ARPU Average revenue per customer. Managing customer data in scale of 40 – 50 millions is often a challenge. Accomplished by making use of various business analysis tools (eg: SAS, SPSS, Teradata, etc.).
Customer experience management
After the identification with the valued/revenue earning customers, managing those identified band of industry is most important.
Emphasizing customers as an alternative to products
Within the last years, the telecom service providers have targeting introduction of recent products. They have got originated new products/services then sought to discover or build a niche for them. But increased competition among the existing agencies minimizing barrier to entry for brand spanking new players has resulted in the development in predatory activities inside the telecom industry. Moreover, the cost of purchase of new clients has grown considerably. Hence, in the current times, there is a gradual change in focus from introduction of the latest products for acquiring customers to customers’ experience management is observed. Currently, the Telco’s must focus on retaining the existing valued customers and targeting more wallet share of every customer by making more value and improved customer experience.
As an example: In the united kingdom, O2 has aligned its functional silos to get its existing customer’s perspective in making product decisions and designing promotional offerings. They’ve got dedicated to retention by placing equal weight for renewals and acquisitions. With this the corporation has reduced its churn figure to half its existing number.
Nintendo has generated a web based community for capturing customer insights and will be offering incentives inturn of customer information. With that Nintendo has gained valuable insights into market needs and preferences.
Customer led customization model
It comes with an underlying assumption how the providers will dictate not able to telecommunication products and services. Though the growing bargaining strength of the customers, there’s a transfer of paradigm as well as the agencies must customize their model based on individual customer preferences. The business will observe the lead with the customers in designing and promoting services meant to meet specific needs from the customers. Under this circumstance, the providers need to find out the unique needs of the people customers, after which try and develop services which satisfy those multifaceted needs.
Developing multiple channels
The providers need to develop multiple channels for sales and support to further improve the client experience. Helping the footprint with the help of on stores is one of the options that the telecom service providers have practiced since ages. Traditional channels like telemarketer firms also ended up in focus. Using the increase in competition and economic slowdown, the operators are looking for economical solutions to serve their customers whilst keeping the service quality intact. Eventually the service providers wish to move most of its sales and services online through the web to realize better economics. In addition to attaining an inexpensive solution by moving to web channels, the operators can empower the shoppers to execute various activities at the less costly price than the retail channels.
Over the web channels, a person can perform a number of activities such as:
– Bill viewing and online payment
– Online register of your complaint for support
– Altering price plan and subscriptions
– Viewing the product catalogue and purchase products/services online
As well as the previously listed activities, the operators will offer promotional services and cross-sell other products on the internet. The operators might have added revenue by ticker management on their websites and advertisements.
To provide the customers can use a consistent and connected experience, the operators should integrate every one of the existing channels. Whenever a customer walks-in to a store, the consumer service representative can retrieve his/her past interactions total the channels to provide him/her within the best possible way.
The operator should analyze/monitor how the customers use these channels. Depending on the available data of customers’ using these channels, the operators can identify the preferences of the individual customers and mold their offering accordingly. From this the operators can build up customer experience by empowering these phones perform activities and therefore helping the service value to them.
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