Hoff Eriksson posted an update 1 month, 2 weeks ago
The telecom agencies usually have followed an increase trajectory during the past decade through rise in subscriber base in addition to adding considerable numbers with their annual revenue. They’ve kept the interest rate with all the competitors and still have literally game with amazing success previously. But in the current times, they’re facing by having an enormous challenge of adaptation on 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 the demand for the hour will be the customer experience management to achieve a higher retention ratio.
Challenge in modern telecom industry – Customer retention
In the current day telecom industry which includes attained high penetration level, having a customer becomes even costlier. Industry analysis claims that only 25% with the acquired customers stay with the business after an year’s some time to on an average only 20 -30% with the entire customer base is revenue earning/profitable customers. This dugs an in-depth hole from the balance sheet in the telecom providers. Due to the churning effect of absolutely free themes, you will find there’s huge imbalance created in gross additions from the customers and net addition.
Forward path: Way to customer retention – Customer experience management
Therefore, the major challenge for that telecom operators worldwide is managing customer churn. It affects profitability of the company if the customer churns before the company can earn back an investment it incurred in obtaining the buyer. Therefore, it is extremely critical to indentify the profitable customers and retain them.
Retaining the profitable customers includes 2 steps:
1. Identifying the revenue earning customers from the entire client base
2. Managing the customer experience and customer value for that revenue earning customers
Identifying the Revenue earning customers
The telecom companies should define their business logic for identification in the revenue earning customers, by way of example: the customers can use with usage over ARPU are high valued customers, or perhaps in the event of pre-paid, customers recharging a lot more than INR 250 per month (In Indian scenario) are viewed as revenue earning. Depending on the business rules the entire client base must 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 using various business analysis tools (eg: SAS, SPSS, Teradata, etc.).
Customer experience management
Following the identification from the valued/revenue earning customers, managing those identified number of clients are most important.
Concentrating on customers rather than products
During the last years, the telecom companies have concentrated on introduction of recent products. They have got originated new products/services and then sought to get or produce a industry for them. But increased competition one of many existing companies reducing barrier to entry for new players has resulted in the expansion in predatory activities in the telecom industry. Moreover, the price tag on acquiring customers has risen considerably. Hence, nowadays in this times, there is a gradual change in focus from introduction of new products for acquiring clients to customers’ experience management is observed. Currently, the Telco’s have to focus on retaining the current valued customers and targeting more wallet share of every customer by making more value and improved customer experience.
For example: In the united kingdom, O2 has aligned its functional silos to have its existing customer’s perspective for making product decisions and designing promotional offerings. They have got devoted to retention by putting equal weight for renewals and acquisitions. With that the organization has reduced its churn figure to 1 / 2 of its existing number.
Nintendo has generated an online community for capturing customer insights and provides incentives in turn of customer information. With this Nintendo has gained valuable insights into market needs and preferences.
Customer led customization model
It comes with an underlying assumption that this providers will dictate the future of telecommunication services and products. However with the growing bargaining strength of the customers, you will find there’s shift in paradigm and the companies need to customize their model based on individual customer preferences. Currently the business will observe charge with the customers in designing and promoting services designed to meet specific needs in the customers. Under this circumstance, the companies have to know the unique needs of the person customers, and after that try to develop services which satisfy those multifaceted needs.
With this particular model, the mass marketing will give way to the customized survey along with the survival from the providers depends on send out capability to meet customer’s demand with an ongoing basis. Put simply, customers will dictate the tos they intend to receive.
Developing multiple channels
The service providers must develop multiple channels for sales and support to enhance the consumer experience. Enhancing the footprint by having on stores is one of the options that this telecom service providers have practiced since ages. Traditional channels like telemarketer firms also had been in focus. With all the surge in competition and economic slowdown, the operators are looking for economical methods to serve the clientele while keeping the service quality intact. Eventually the service providers would want to move majority of its sales and services online through the web to realize better economics. In addition to attaining an inexpensive solution by relocating to web channels, the operators can empower the customers to perform various activities at the less costly price as opposed to retail channels.
On the internet channels, a customer are able to do a number of activities like:
– Bill viewing and internet-based payment
– Online register of a complaint for support
– Altering price plan and subscriptions
– Viewing the merchandise catalogue and purchase products/services online
In addition to the previously listed activities, the operators will offer promotional services and cross-sell other products online. The operators will surely have added revenue by ticker management on the websites and advertisements.
To offer the customers can use an even and connected experience, the operators should integrate all of the existing channels. Every time a customer walks-in with a retail outlet, the consumer service representative are able to retrieve his/her past interactions total the channels to serve him/her inside the very best way.
The operator needs to analyze/monitor how a customers utilize these channels. Depending on the available data of customers’ using these channels, the operators can know the preferences of the person customers and mold their offering accordingly. By this the operators can take shape up customer experience by empowering these phones perform activities and thus helping the service value for them.
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