The telecom providers usually have followed a growth trajectory previously decade through increase in usage and also adding considerable numbers with their annual revenue. They've got kept the pace with all the competitors and have literally game with great results during the past. However in the present times, they are facing with an enormous challenge of adaptation for the matured, highly penetrated markets as well as global recessionary effect. Therefore, a change in paradigm to adapt their business models to the scenario is highly required and also the demand for the hour is the customer experience management to attain a greater retention ratio.
Challenge in modern telecom industry - Customer retention
Nowadays in this day telecom industry containing attained high penetration level, acquiring a customer is getting even costlier. Industry analysis states that only 25% of the acquired customers stick with the corporation after an year's some time to while on an average only 20 -30% in the entire subscriber base is revenue earning/profitable customers. This dugs an in-depth hole within the balance sheet from the telecom companies. As a result of churning aftereffect of the customers can use, there's a huge imbalance made in gross additions with the customers and net addition.
Forward path: Method to customer retention - Customer experience management
Therefore, the key challenge for that telecom operators worldwide is managing customer churn. It affects profitability of the company if a customer churns prior to the company can earn back an investment it incurred in obtaining the client. Therefore, it is rather necessary to indentify the profitable customers and retain them.
Retaining the profitable customers includes 2 steps:
1. Identifying the revenue earning customers in the entire customer base
2. Handling the customer experience and customer value for your revenue earning customers
Identifying the Revenue earning customers
The telecom companies should define their business logic for identification with the revenue earning customers, for instance: absolutely free themes with usage more than ARPU these are known as high valued customers, or perhaps in the event of pre-paid, customers recharging greater than INR 250 each month (In Indian scenario) are viewed as revenue earning. Depending on the business rules the entire subscriber 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 a challenge. This can be achieved with the aid of various business analysis tools (eg: SAS, SPSS, Teradata, etc.).
Customer experience management
After the identification in the valued/revenue earning customers, managing those identified group of customers are very important.
Focusing on customers as an alternative to products
Over the past years, the telecom companies have concentrated on introduction of latest products. They've originated new products/services and after that sought to locate or produce a marketplace for them. But increased competition on the list of existing service providers minimizing barrier to entry for brand new players has resulted in the increase in predatory activities within the telecom industry. Moreover, the cost of acquiring new customers has expanded considerably. Hence, in the current times, there is a gradual shift in focus from introduction of recent products for acquiring clients to customers' experience management is observed. Currently, the Telco's need to concentrate on retaining the prevailing valued customers and targeting more wallet share of each one customer by creating more value and improved customer experience.
As an example: In UK, O2 has aligned its functional silos to obtain its existing customer's perspective to create product decisions and designing promotional offerings. They have got dedicated to retention by putting equal weight for renewals and acquisitions. By this the corporation has reduced its churn figure to 1 / 2 of its existing number.
Nintendo has produced a web-based community for capturing customer insights and offers incentives in turn 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 that the agencies will dictate not able to telecommunication services. Though the growing bargaining strength of the customers can use, you will find there's change in paradigm along with the agencies have to customize their model based on individual customer preferences. The business will follow the lead in the customers in designing and promoting services meant to meet specific needs in the customers. Under this circumstance, the service providers have to know the unique needs of the baby customers, and then make an effort to develop services which satisfy those multifaceted needs.
Using this model, the mass marketing can give way to the customized survey as well as the survival with the companies is determined by their power to meet customer's demand by using an ongoing basis. In other words, customers will dictate the service terms they mean to receive.
Developing multiple channels
The providers should develop multiple channels for sales and support to enhance the consumer experience. Helping the footprint by adding on stores is one of the options that your telecom companies have practiced since ages. Traditional channels like telemarketing companies also had been in focus. Using the rise in competition and economic slowdown, the operators are seeking economical methods to serve the clientele and keep the service quality intact. Eventually the service providers would like to move most of its sales and services online from the web to attain better economics. Aside from attaining an affordable solution by relocating to web channels, the operators can empower the customers can use to execute various activities at a a lot less expensive price compared to the retail channels.
Online channels, an individual are able to do a host of activities like:
- Bill viewing and internet-based payment
- Online register of a complaint for support
- Altering price plan and subscriptions
- Viewing the item catalogue and purchase products/services online
As well as the previously discussed activities, the operators will offer promotional services and cross-sell other products over the web. The operators might have added revenue by ticker management on their own websites and advertisements.
To deliver absolutely free themes an even and connected experience, the operators should integrate each of the existing channels. Every time a customer walks-in to some retail outlet, the consumer service representative will be able to retrieve his/her past interactions over all the channels for everyone him/her within the most beneficial way.
The operator has to analyze/monitor how a customers use these channels. With regards to the available data of customers' use of 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 for that reason helping the service value for them.
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