The telecom agencies usually have followed an improvement trajectory before decade through boost in subscriber base as well as adding considerable numbers on their annual revenue. They've got kept the pace with the competitors and also have unquestionably game with great results previously. In the latest times, they may be facing by having an enormous challenge of adaptation for the matured, highly penetrated markets in conjunction with global recessionary effect. Therefore, a shift in paradigm to evolve their business models to the current situation is highly required and the need of the hour is the customer experience management to realize a higher retention ratio.
Challenge in modern telecom industry - Customer retention
In the modern day telecom industry containing attained high penetration level, having a customer becomes even costlier. Industry analysis states that only 25% from the acquired customers keep with the company after an year's serious amounts of on an average only 20 -30% of the entire client base is revenue earning/profitable customers. This dugs an in-depth hole inside the balance sheet in the telecom service providers. As a result of churning aftereffect of absolutely free themes, there exists a huge imbalance made in gross additions in the customers and net addition.
Forward path: Method to customer retention - Customer experience management
Therefore, the major challenge for your telecom operators all over the world is managing customer churn. It affects profitability in the company if a customer churns prior to the company can earn back an investment it incurred in establishing the client. 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 your entire client base
2. Managing the customer experience and customer value to the revenue earning customers
Identifying the Revenue earning customers
The telecom providers should define their business logic for identification from the revenue earning customers, by way of example: absolutely free themes with usage more than ARPU are high valued customers, or in the event of pre-paid, customers recharging a lot more than INR 250 monthly (In Indian scenario) are believed as revenue earning. Based on the business rules your entire client base should 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. This can be accomplished with the aid of various business analysis tools (eg: SAS, SPSS, Teradata, etc.).
Customer experience management
Following your identification with the valued/revenue earning customers, managing those identified number of customers are most important.
Concentrating on customers rather than products
In the last years, the telecom providers have focused on introduction of new products. They have got originated new products/services and after that sought to get or build a niche for them. But increased competition among the existing service providers and lower barrier to entry for brand spanking new players has ended in the increase in predatory activities in the telecom industry. Moreover, the cost of acquisition of clients has grown considerably. Hence, in the modern times, there exists a gradual transfer of focus from introduction of recent products for acquiring new customers to customers' experience management is noted. Currently, the Telco's should pay attention to retaining the current valued customers and targeting more wallet share of each customer by creating more value and improved customer experience.
As an example: In the united kingdom, O2 has aligned its functional silos to acquire its existing customer's perspective in making product decisions and designing promotional offerings. They have got dedicated to retention by placing equal weight for renewals and acquisitions. From this the organization has reduced its churn figure to half of its existing number.
Nintendo has generated a web-based community for capturing customer insights and offers incentives in turn of customer information. From this Nintendo has gained valuable insights into market needs and preferences.
Customer led customization model
It comes with an underlying assumption how the agencies will dictate not able to telecommunication services. However with the growing bargaining energy the customers can use, there is a change in paradigm along with the companies need to customize their model based on individual customer preferences. Currently the business will track the lead in the customers in designing and promoting services meant to meet specific needs with the customers. Under this circumstance, the service providers have to identify the unique needs of the person customers, and after that attempt to develop services which satisfy those multifaceted needs.
With this particular model, the mass marketing can give strategy to the customized researching the market and the survival with the companies is dependent upon their capacity to meet customer's demand on an ongoing basis. Quite simply, customers will dictate the tos they mean to receive.
Developing multiple channels
The providers must develop multiple channels for sales and support to improve the customer experience. Enhancing the footprint with the help of on stores is among the options that your telecom service providers have practiced since ages. Traditional channels like telemarketing companies also have been in focus. Together with the boost in competition and economic slowdown, the operators are searching for economical approaches to serve their potential customers and keep the service quality intact. Eventually the service providers would want to move tastes its sales and services online through the web to realize better economics. Besides attaining an affordable solution by moving to web channels, the operators can empower the customers to execute various activities at a a lot less expensive price compared to retail channels.
Over the web channels, an individual can perform a number of pursuits like:
- Bill viewing and internet based payment
- Online register of your complaint for support
- Altering price plan and subscriptions
- Viewing the product catalogue and buying products/services online
As well as the above mentioned activities, the operators may offer promotional services and cross-sell other products online. The operators might have added revenue by ticker management on their own websites and advertisements.
To deliver the customers an even and connected experience, the operators should integrate all of the existing channels. Every time a customer walks-in with a retail store, the buyer service representative can retrieve his/her past interactions total the channels to serve him/her within the very best way.
The operator should analyze/monitor the way the customers start using these channels. Depending on the available data of customers' using these channels, the operators can find out the preferences of the individual customers and mildew their offering accordingly. From this the operators can take shape up customer experience by empowering the crooks to perform activities and so increasing the service value in their mind.
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