There are many problems that face telecoms operators today. Network congestion, investment challenges, dissatisfied customers, but probably the one that keeps CEOs awake at night is churn. Churn is proof positive that customers think that the service is bad enough that they are willing to jump ship. Last year, according to this article, churn was running at between one and two percent in the US last year. That may not sound like a problem but take a carrier with just 40 million customers – and you get the point.
To counter this challenge, operators have tried many approaches over the years. Bundling products and services certainly works, solving customer queries and complaints right the first time also works, screwing up, solving the problem, apologising and being human works better than it should. Having a network that does what the operator says it can do should be a given. Putting pushy salesmen into customer service and trying to sell deserting customers back into your world is probably the most offensive and least effective way of operating.
Now, though, after many, many presentations, conferences, papers, articles and discussions, it seems that analytics also works – in the field. Vodafone, the giant that posted revenues of around £40 billion last year has boosted its revenues by between one and two percent, ‘thanks to real-time anticipatory selling propelled by big data analytics.’
Although it is not clear from the article just how much of their customer base they are addressing with analytics, it seems they are definitely using the technique to offer prepaid customers deals as their balance drops below a certain point. This ties in with a survey conducted by the TM Forum last year that showed that the emphasis for real time functionality today is to help customers avoid bill shock, through balance management services. The survey also showed that in two years’ time the emphasis will shift to supporting OTT collaboration, dynamic pricing and innovations in areas such as zero rating some apps. Vodafone, incidentally, just got fined for offering zero rated Facebook in the Netherlands, the only European country to have implemented net neutrality.
That analytics is clearly still in its infancy is not in dispute. What is encouraging is that a telecoms giant has put its money where its mouth is and is beginning to replace lost revenue by offering customers what they want when they want it.
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