Around the World

Posted: August 27th, 2013 | Author: | Filed under: Around the World | Tags: , , , , , | Comments Off on Around the World

As usual, there’s been a lot going on in the telco industry these days. Comptel wants to bring you the best, most interesting stories and studies we’ve found, so communications service providers (CSPs) can stay on track.

Here are three in particular that caught our eye:

Billing & OSS World…

Big Opportunities From Big Data, But Barriers Remain

Fifty-eight percent of those surveyed think that the main, long-term driver is generating new business models. Informa Telecoms & Media has released a new survey of telecom operators which shows that Big Data has the potential to create great opportunities for businesses in the future. The respondents also agreed that Big Data’s short-term driver is solving internal challenges.

Forty-eight percent of operators said that they have Big Data solutions implemented already. On average, they spend ten percent of their IT budgets on Big Data, and this is expected to increase to twenty-three percent within the next five years. However, a major barrier that continues to be an issue is that operators still lack a business proposition and a trained team to handle the implementation.

Comptel’s own Matti Aksela recently spoke to Telecom Asia on this latter issue: “Vendors operating in this space can have a very skilled team behind their analytics solutions, and knowledge on integration and decision-making based on the analytics, and can quickly achieve benefits for CSPs. It may be even easier to ‘tear down the silos’ coming from the outside than just working internally.” Read the full article on whether telecom operators should manage analytics in-house or outsource it here.

Analysys Mason…

Analytics Applications Provide Rich Functionality and Low-Risk Deployment to Help Drive New Use Cases

CSPs have been using traditional analytics tools to help review data, analyse it and report it. However, new analytics applications can be deployed and configured specifically for a CSP’s use case, automating the best practices learned throughout the industry while eliminating the need for scarce data scientists to help segment and manage the data.

The real challenge in deploying a new analytics solution is infrastructure. CSPs must be flexible about changes in operations, so the business can accommodate new tools into the workflow Infrastructures are usually created with a specific use case in mind, but when an application is on top of the old infrastructure, there’s always the risk of compatibility. Lastly, CSPs will have to depend on vendors for updates to the application. Analytics applications are beneficial for CSPs, but operators must have the means to implement a new system of data analytics for the analytics applications to be successful.

Matti Aksela spoke with Big Data Republic in June about Big Data’s ability to reduce churn through advanced, predictive analytics tools. Robi Axiata experienced the results first-hand – once the factors of churn were identified, strategies could be taken to predict and eliminate them in the future.


Should experience come before the engagement?

With Big Data helping CSPs identify the granular aspects of the customer experience and customer engagement, it’s easier to see where in the organisation improvement is needed. While customer experience represents the sum of what a customer has experienced at a given time, engagement represents the sum of the customer’s experiences over time. For the customer experience to be improved, specific departments can be targeted and strategies can be recalibrated. Customer engagement, however, needs an enterprise-wise approach to be improved.

A customer’s lifetime value must be determined and closely nurtured by the entire organisation to ensure that engagement is positive and, as Ulla Koivukoski wrote, CSPs can uncover new revenue streams and grow businesses by focusing on engagement. Predictive analytics can play a major role in fostering departmental collaboration and, in turn, delivering high-quality customer experiences.

Telecoms: Creating Motives for Delight

Posted: August 12th, 2013 | Author: | Filed under: Industry Insights | Tags: , | 1 Comment »

Differentiating through customer experience should go beyond addressing the reasons for dissatisfaction

Competition in the telecoms industry is threatening to intensify the pressure on the traditional revenue of established communications service providers (CSPs). This article, which was originally published on Analysys Mason’s website, discusses the importance of improving the customer experience and the lessons that can be learned from the airline industry.

You board a flight to return home. Before take-off, you are offered a drink and some snacks. The plane takes off, but you don’t even notice because you are watching that movie you missed last month in the cinema. After 20 minutes, a member of the highly efficient cabin crew offers you a delicious meal. Later, when you are informed that the plane is about to land according to schedule, you are surprised at how quickly the trip went. The whole flight experience was designed to please the senses.

After a few flights, you start to associate the airline with high-quality customer service. Next time you are booking a trip and the name of that airline shows up in the list, you will instinctively select it, overlooking the hefty price premium you will be paying compared with the cheapest option. You will be paying for the customer experience, and you will not be alone. Many will do the same, feeding the profits of the companies that strive to please you.

The liberalisation of the airline industry led to its commoditisation, driven by the appearance of several low-cost airlines. The price pressure that this caused reduced the margins of established airlines, leaving them with no alternative but to differentiate through customer experience. The successful ones have done so, and manage to retain a price premium despite offering a commoditised service. The ones that did not, mostly state-owned companies, struggle or have vanished.

Telecoms operators are in a very similar situation. More competition is driving a significant price reduction, eroding margins and forcing CSPs to improve efficiency. Over-the-Top (OTT) players threaten to have the same impact on the traditional revenue of established operators as low-cost airlines had in the airline industry. However, the potential to differentiate exists, and examples from other industries can offer some guidance.

Although large numbers of CSPs’ subscribers are price sensitive, the value is typically concentrated in a small proportion of high-value customers. Above all, these customers are looking for a problem-free, enjoyable telecoms experience. When subscribing to a service, customers want their CSPs to guide them in the process, speak the same language and allow for service experimentation. Once subscribed, customers want to be able to quickly and easily access the services and activate additional services with the least hassle.

Customers should never need to contact the CSP to solve problems, but if they do, the customer support should be readily available and knowledgeable. It seems simple, but a good customer lifecycle experience is hard to design and implement. However, it does not need to be expensive. In another recent article, Mike Pearson discusses a real case of a telecoms operator that improved the experience for its customers and reduced its costs.

If telecoms operators are to improve the experience of their customers, they must make a concerted and cross-functional effort. Commercial and technical departments should work together, and the right incentives should be in place to ensure that the organisation is focused on the same final goal.

Roughly speaking, implementing a good customer experience involves four steps:

1. Understand the pain points

The starting point of this assessment should be customer perception, but this can be misleading. Is your call centre really that good, or do customers think it is good because they have low expectations? A mix of customer perception, competitor benchmarking and internal quantitative measurements need to be part of this assessment.

    2. Identify the root cause of the problem

    This requires a detailed internal analysis, examining KPIs and processes to understand where a gap exists. If your customers perceive that you are overcharging, the cause could be anything from an issue with the BSS to a miscommunication by the sales team.

      3. Quantify the impact of the problem to understand how much it is worth to solve it

      Improving customer experience improves price premium and margins, but also requires investment. Ensuring a positive return on these investments is a key part of the overall performance improvements.

        4. Solve the problem

        A proper workplan and resources with the right incentives need to be put in place. Having the right KPIs is essential to ensuring that the impact of the transformation is quantifiable. Involving the whole company is also vitally important – changing only a part of the customer experience will not be enough. It only works if it all works.

          Obviously, not having dissatisfied customers is different from providing a differentiated customer experience. Differentiating through customer experience should go beyond addressing the reasons for dissatisfaction – it needs to create motives for delight. This is where the real challenge lies, but the process is similar – assess the customer lifecycle, identify improvement potential, implement and quantify impact.

          CSPs are very focused on avoiding commoditisation and margin squeeze by adding value-added services to their propositions. That is needed, but, as with airlines, the best value-added service CSPs can give to customers is an excellent customer experience.

          Comptel’s Take

          We think that the parallel Carlos draws between airlines and CSPs is an important one. Just like the airline industry, telecoms is facing some unprecedented new competition in the way of OTT players and other new services based on mobile data. To stand out today, CSPs have to create innovative pricing bundles and offers that the competition can’t, while at the same time providing unmatched service quality.

          For a streamlined customer experience, we believe CSPs should leverage the potential of big data. By applying predictive analytics to customer insights across multiple platforms, it’s possible to identify trends, preferences and demographics that can be crucial to building next-generation customer service.

          That way, if a customer does have a quality issue, CSPs can act immediately to not just remedy the problem, but delight the customer. At the same time, predictive analytics can discover the preferences and usage habits of customers, which can then be leveraged to create marketing campaigns and messages tailored to their needs.

          Carlos Pinto is a senior manager at Analysys Mason and is based in Dubai. He has advisory experience specialising in analytical marketing, commercial value proposition definition, customer value development strategies, mobile pricing, network optimisation strategy, and financial analysis and valuation. He has developed and implemented business plans and marketing strategies for different companies and government authorities worldwide, including commercial strategies for companies in Europe, Africa, the Middle East, Southeast and Central Asia. He has advised CEOs and board members of some of the biggest telecoms groups in countries such as Bahrain, Congo-Brazzaville, Kenya, Nigeria, Portugal, the Philippines, Saudi Arabia, South Africa, Tanzania, UAE, Uzbekistan and Zambia.

          To Reverse Declining Revenues, the Telco Industry Has to Think Outside the Box

          Posted: August 5th, 2013 | Author: | Filed under: Telecom Trends | Tags: , , , , , , | 1 Comment »

          A new report from independent global analyst firm Ovum showed that the telco industry may be experiencing declining revenues for the near future. Most of the decline will occur among telcos with significant exposure to Europe and other mature economies. The only significant growth is taking place within emerging markets, particularly China.

          The findings come from a review of full-year KPIs of 23 of the world’s largest telcos, and the analyst firm expects revenues to slow down until at least 2018.

          Ovum’s review may or may not come as a surprise to communications service providers (CSPs), which have already been in a constant dance to adapt to the latest technology and the latest competition. While Ovum’s findings seem grim, they should be embraced as an incentive to modernise and innovate their service offerings and customer focus.

          The telco industry can look at two things in particular: finding the equilibrium that balances OTT contribution with their business models, and leveraging core competencies and rich data to operationally transform into a “customer company.”

          1. Treat OTT players like inspiration, not competition.

          The loss of revenues telcos are experiencing is, more often than not, blamed on OTT players. There’s no doubt that services like Apple, Google, Skype and WhatsApp are draining business from the industry, but that doesn’t mean that the answer is to aggressively defend market positions, or turn the other way and pretend they don’t exist.

          Ovum’s telco operations analyst and report author Adaora Okeleke suggests using them as inspiration. “Telcos could feasibly play a role as service enablers, but they first need to adopt the leaner structures of OTT players such as Google,” she said in a statement. “By partnering with application developers and allowing them to use their secure platforms for service delivery, telcos will be able to drive innovation and reduce time-to-market.”

          As my colleague, Steve Hateley, recently wrote, another option is to try new pricing structures that OTT players can’t give to customers. Some CSPs are experimenting with unlimited bundles, as opposed to reversed, limited bundles. There are also potential strategic alliances that could be built between CSPs and OTT providers that benefit everybody. After all, OTT players still depend on the network infrastructure that CSPs provide.

          2. Create more efficient operations.

          By invoking the “leaner structures” of Google, Okeleke acknowledges that there are inefficiencies in the current telco business model. But it doesn’t take too much digging to discover that this is a common sentiment.

          As an example, many CSPs have more than one mediation and / or provisioning platform, which can end up producing redundancies and slow, error-filled service roll-outs. OSS consolidation may seem intimidating, but the rewards are worth it – by consolidating five systems into a single Comptel Convergent Mediation platform, for example, one CSP recently reduced operational costs by up to 30 percent.

          Additionally, having a central solution for their increasing amount of network, service and other data allows CSPs to more effectively apply contextual intelligence to overcome their business challenges associated with better customer understanding.

          The Future of Telco

          There’s no doubt that things in the telecommunications industry are getting shaken up, but new technologies can offer a host of opportunities for CSPs just as old revenue and business models continue to decline. Comptel is working hard to provide those solutions to the telco industry, and we’re excited for the future, because those solutions mean a better experience for customers and better operations for CSPs.