By Simon Loe, Alcatel-Lucent
Telecom service providers in developed markets are turning to customer experience as a business strategy to address growing market saturation, reduce customer churn and increase profitability. There is a growing body of evidence that demonstrates better services generate price premiums.
The strategy is being implemented in a number of different ways, such as:
- mobile service providers providing subscribers with a small cell to improve signal strength and broadband speeds;
- operators improving new service switch-on by making process simpler through smarter software in customer equipment;
- call centres using smarter technology, such as IVR and network monitoring, to resolve customer problems faster.
However a bigger return can be achieved by taking a broader perspective on customer interaction, as well as implementing specific product or service improvements.
The first step is to improve customer understanding. Through better information, we can obtain more insight into customer preferences, trends, and identify opportunities to deliver new services with better perceived value.
This in turn will provide sufficient data to enhance market segmentation and personalization. Consumers typically respond positively to a more personal approach, so will receive communications in a more receptive manner.
When combined with activities that augment customer experience, such as those mentioned above, these initiatives, can foster a different relationship, which over time and consistent service delivery will create consumer trust that strengthens brand value and makes portfolio expansion easier.
This good example of this broader approach is Amazon, which is consistently cited as an example of how personalization, customer experience and trust combine to create real passion among its consumers.
Telecom service providers have the same proximity to their customers as Amazon, yet in many cases do not engender the same loyalty. Why? Amazon stands out by delivering service with very high consistency and by taking full ownership of customer experience.
Knowing how good service will be is a powerful driver for loyalty. Yet established telecoms organizations often struggle to deliver consistency due to their departmentalized structures and databases of consumer information – the result being consumer confusion and dissatisfaction from simple inconsistency. We need to re-engineer how we deliver services.
For many years, service providers did have full ownership of customer experience, but in recent years application and content providers (ACPs) have taken greater shares. Some view the new entrants like Google, Apple and the like as competitors. Yet through application and content enablement, such as with content delivery networks or by exposing APIs, service providers can deliver better customer experiences in collaboration with ACPs.