3 Key Takeaways from Elisa’s Digital Business Transformation

Need a haircut? In the past, you may have called up a salon and made an appointment. Today, M Room – the international chain of men’s barber shops with locations across Europe and the United States – allows you to check its mobile app to find the nearest shop with the soonest vacancy. That way, you don’t have to rearrange your schedule to make an appointment, nor must you sit in line waiting for a spot to open up.

Veli-Matti Mattila, CEO of Finnish operator Elisa, recently cited M Room’s app as an example of how mobile and digital services are changing our everyday lives. As Mattila explained, digitalisation is a major change agent in global society and has the power to disrupt all industries.

Digitalisation will usher in an era of business transformation that will radically change how all businesses including telcos, in particular, operate. Elisa is a prime example – the company may have once been known as a traditional voice provider, but today, it would be more accurate to call it a digital and communications services provider.

Elisa offers its customers much more than simple connectivity. Its range of consumer services include an entertainment service for watching TV with cloud-based recording and content on demand, a wallet app for mobile payments and a book app for avid readers. On the business-to-business (B2B) end, Elisa offers video conference, customer interaction services and social media listening services, to name just a few.

Mattila helped engineer Elisa’s digital business transformation in his 12 years as CEO, and the results have been significant. The company’s initial six-month financial review showed that, despite a challenging economic climate, Elisa made its best-ever result from January to June 2015. The company also reported an expected growth in year-to-date revenue compared to the same time period in 2014.

Mattila’s comments reinforce what Comptel has discussed in our book, Operation Nexterday: digitalisation is forcing telco business transformation, and this adoption and evolution is vital if operators are to best serve individual and business customers and grow their organisations. Here are three takeaways from Elisa’s journey that other operators should note.

How Telco Can Disrupt in the Digitalisation Age

Consider how private car hire and ride-sharing service Uber has transformed public transportation internationally. Customers can simply queue up the app to find a nearby driver and conduct the entire transaction digitally, making for an easy and cashless ride.

As more industries embrace digital technology – from massive international conglomerates like Uber to the local coffee shop on your nearest street corner – operators will increasingly find an opportunity to add value.

They can enter markets they may never have thought possible, such as delivering over-the-top (OTT) content, social apps and now even books, as Elisa has done.

Operators should not discount cooperating with other players and building digital ecosystems to accomplish this. In the case of Elisa, the Finnish telco purchased capabilities from other organisations to establish an enablement platform upon which it could disrupt the market.

Embedding a Digital Culture at Every Level

Of course, making this change is not easy. Not every operator may have the vision to execute a broad digital business transformation. But, as Mattila explained, businesses do not need a Steve Jobs-type visionary at the top to push forward a digital service strategy. All you really need is firm direction, leadership, courage to change and a willingness to try new things.

Senior management should be in charge of digitalisation, Mattila recommended, and the sales, distribution and customer service functions need to buy in as well. Change may happen incrementally, but as long as they are watching the market, experimenting and pushing in the right direction to rewrite their playbooks, operators can transform successfully. Those that do not will die and perhaps result in new life.

Experiment Often, With a Focus on Speed

Above all, transforming into a digital business is a matter of trial and error. Not every new digital service offering or business idea will succeed, but as long as operators try new things quickly and ‘fail fast’, they will have the opportunity to quickly recover, learn from the results and react and ‘scale fast.’

Telco organisations should not fear failure, Mattila advised, because mistakes inform future successes. Maybe one opportunity will stick and truly catapult the business forward. The experimenting done and ideas that survive will ultimately make a major difference in operators’ successful transition to next-generation digital and communications service providers.

This blog post is based on Veli-Matti Mattila’s interview on the Confederation of Finnish Industries (EK) website and written up by Antti Blåfield.

Using Predictive Analytics to Put a Spin on Old Marketing Campaigns

Three years ago, I was writing my first blog post about how I had received a package from Formula One racer Kimi Räikkönen, the coolest guy in the universe. In Finland, as part of our school traditions, every first grader gets his or her first mobile phone at the age of seven. That is when our award-winning school system begins to educate our offspring in order to meet OECD and Pisa test requirements. The battle for these new mobile subscriptions is fierce, with communications service providers (CSPs) offering a wide range of options to parents and their kids.

This week, the same package arrived for the next class of first-graders – only this time, Angry Birds had replaced Mr. Räikkönen as the mascot. Finnish mobile operator DNA Finland sent a prepaid SIM card to every Finnish mom (including me) who had a child that was born in 2006 and entering the first grade. Three years ago, I thought that this campaign was extremely clever. Now, though, I’m wondering if DNA Finland could have learned something during the past three years. Sure, the mascot may have changed, but the campaign is largely the same. With new tools like predictive analytics available to CSPs, it seems like the marketing could become much more sophisticated.

DNA Finland knows that I am not their customer and the same applies to other household members. As Comptel’s recent global consumer study showed, having friends and family members who were using the same operator was the third most important factor (41%) for consumers when choosing a CSP. Does DNA Finland know that I didn’t choose them three years ago? Could this campaign have been better customised for mothers who aren’t already DNA Finland’s customers?

I have been waiting for Elisa’s counter offer and I’m wondering if they are using analytics to discover that I am extremely likely to bring them new business by August. After all,  our family already has a wide selection of Elisa’s offerings – four mobile subscriptions and one broadband (ADSL) connection. One mobile subscription is for the enterprise customer segment, our broadband connection is in the corporate segment and the rest of our SIM cards are under the consumer customer brand Saunalahti.

I can’t help but wonder if all that information is scattered across various silos and systems. That could make it difficult to apply analytics to all that data and leverage it for new marketing campaigns. Ulla Koivukoski, Comptel’s senior vice president of the analytics business unit, recently wrote  about the distinct silos in CSPs and how business units aren’t always looking to solve the same problems. Customer Experience is the issue that bridges the divide between all the competing business interests. And, while receiving an Angry Birds-themed package is nice, I would have remembered something that was personalised a lot more.

With current targeting methods marketers typically end up either with target groups that are too defined and small – it does not make sense to campaign or the campaign scope is too generic and therefore likelihood of inaccuracy increases, as the case in the angry birds campaign. Comptel Social Links can change the mind-set in marketing by combining the marketers’ expertise of selected target group with machine learning letting the algorithms find the customers most similar to the obvious customers. Predictive modelling results will be available for the marketing team instantly, resulting in more accurate hit rates for campaigns, higher customer satisfaction and finding optimal users for the product or service marketed.

CSPs want to make sure that customer service is as good as possible. If you’ve delivered a great customer experience, your efforts are turned into new business opportunities. The first step, though, is to find out just how to use the data you already have to deliver that customer experience. Maybe the next group of first graders will get packages that are a little more customised.

Lessons in Dynamic SIM Management from Kimi Räikkönen

In Finland, as part of our school traditions, every first grader gets his or her first mobile phone at the age of seven. That is when our award-winning school system begins to educate our offspring in order to meet OECD and Pisa test requirements—one factor contributing to Finland recently being named the world’s best country by Newsweek. The battle for these new mobile subscriptions is harsh, with communications service providers offering a wide range of options to parents and their kids.

This July, I received a surprising package from Kimi Räikkönen—that was exactly how it was marketed to my target group and how my daughter told it to everyone she met during the following weeks. Finnish mobile operator DNA Finland sent a prepaid SIM card to every Finnish mom (including me) who had a child that was born in 2003 and entering the first grade.

As a marketer, I had to admit that this campaign was extremely clever! A photo of the coolest guy in the universe covered a bright pink package containing not only the pre-paid SIM card but also a Kimi poster, a set of removable tattoos and a reflector—all of the things that first graders simply adore. For moms, DNA included a nice letter explaining how mobile phones are important for protecting kids and giving peace of mind to worrying parents. (In Finland, most of the kids walk or cycle to school and back on their own or with schoolmates or older siblings, and return home hours before their parents.)

After I had recovered from the amazement of Kimi sending me a package, I started to think about the pros and cons of DNA’s offer. First, I have never been a fan of pre-paid subscriptions, even if this one had feature that allowed kids to call two selected numbers, even if they run out of balance. Secondly, I was wondering what the pre-selected number was. Could I change it if I did not like the number? And what about the services? Could I modify the subscription? This might be a good option for a first grader but not so great for an older child a couple of years down the road.

These thoughts brought me back to the same issues I had tackled few months earlier when Comptel was planning the Comptel Dynamic SIM Management launch. And now I needed one–a SIM card management solution.

A month later, Kimi Räikkönen’s charisma faded. One Sunday morning, my daughter said, “Mom, let’s go to the Elisa shop and buy a phone for me!” And that is what we did. Along with a pink Nokia 7020, we purchased a Saunalahti subscription, I selected a phone number that included her date of birth and excluded a couple of unnecessary services.