Earlier this month, my wife and I celebrated a special milestone: we met for the first time exactly 8,000 days ago in London (I was cooking tarragon chicken and, yes, the rest is history).
Counting the days feels like a strangely precise excuse for a random party, but it works for us: the 5,000th day since her sister got married is coming up; 6,000 days since the birth of our first daughter in June … the list goes on.
In fact, a day may well be the unit of time by which we come to measure loyalty in the communications industry – but don’t expect to count too many of these days.
That’s because churn remains prevalent in our industry. Customers continue to be demanding and willing to move as several studies suggest.
Meanwhile, service providers say they continue to place customer experience at the heart of their transformation initiatives. In a recent EY report covering the global telecom market, lead analyst Adrian Baschnonga explained that customer experience management is the top strategic priority for 68% of the 40 C-level respondents he spoke to.
This focus resonated with the results of a C-level survey of 100 major telcos carried out by Telesperience’s Teresa Cottam, which also found investment in customer experience to be the number-one priority for service providers.
So why, despite all this focus on customer experience-led transformations, are most service providers still facing so much churn?
To answer this, let’s look at those service providers who have managed to significantly reduce churn rates, with only 35% of customers in some segments reporting a less-than-one-year relationship, as opposed to the less attractive average of 50%.
These service providers tend to get three things right:
They are designing services that are exciting and inspiring
As former Fujitsu CIO David Smith reminds us in a recent blog post, services that have meaning create a strong attachment to the brand and result in a better financial performance.
They are creating interactions that are intelligent and personalized
Customers who are recognized as individuals feel valued and, in turn, value their operator.
They are using their network dynamically
According to Hot Telecom’s new research into quality of experience, 45% of mobile users would pay more for better data coverage. So the ability to identify these consumers in real time would generate a clear return on investment.
In doing the above, successful service providers accelerate their own business value and enjoy both higher retention and net promoter scores. And that 15% improvement in churn rates from 50% to 35% flows into more revenue, lower cost of sales and increased profitability.
Whether you’re counting relationships in days (like me), months or years, your customer transformation program is as much about the “how” as it is the “what.”
With more than 20 years of strategic and operational marketing experience predominantly in IT and telecommunications, Vincent Rousselet is an experienced global marketer and strategist who has worked with some of the world’s most recognizable organizations and brands, and now leads the entire Market Insight & Strategy group at Amdocs. Rousselet’s responsibilities in this executive role include managing Amdocs analyst relations, developing Amdocs’ thought leadership programs, connected world business strategies and models, and advising C-level service provider executives worldwide at tailored workshops to help them forge business and marketing strategies in order to grow their business. He has also taught masters programs on strategic service marketing at both ESSEC (where he graduated in 1991) and the Institut des Sciences Politiques in Paris. Rousselet is a Fellow of both the British Computer Society and the Strategic Planning Society.
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