Customer Experience Transformation Strategies Reduce Churn, Increase Profitability

Next Generation Communications Blog

Customer Experience Transformation Strategies Reduce Churn, Increase Profitability

By Beecher Tuttle

Providing unique and differentiated offerings has become a real challenge for today's service providers. The fact is, the old way of winning and retaining business through network and technology upgrades simply doesn't attract customer interest the way that it used to.

With this in mind, many forward-thinking service providers are implementing new strategies to differentiate themselves from their competitors. To succeed in the broadband market, more service providers are turning their attention to the customer experience and focusing on things such as Alcatel-Lucent’s Customer Experience Transformation Program.

In today's telecom services market, improving the quality of experience (QoE) for the customer has become imperative to remaining profitable. Unfortunately, the task of customer experience transformation is more difficult than ever before due to the sheer complexity of current smartphones, applications and services.

As an example, a recent Yankee Group survey found that 26 percent of smartphone users report experiencing "significant" problems with their device, while another 17 percent report minor problems. Needless to say, this has dramatically increased call volumes and average handle times while minimizing first call resolution rates.

This new environment has given operators a great opportunity to succeed – or fail – based solely on how well they satisfy their customers' technical support needs. Those that provide industry-leading QoE can differentiate themselves from the pack, minimize churn and become more profitable.

In fact, a recent survey from the Strativity Group found that 70 percent of consumers are more willing to spend more time with businesses that surpass their expectations. However, when customers are dissatisfied with their experience, the likelihood of them moving on to a competitor increases 10-fold.

Customer churn in the telecom services market is more significant than that of nearly any other industry. Based on average churn rates, a service provider with 1 million customers will need to replace between 150,000 and 300,000 subscribers every year. With the average cost to acquire a single new customer estimated at $400, such a service provider would need to spend between $60 million and $120 million just to keep the status quo.

This means that if a service provider can lower their churn rate by just 1 percentage point, they can save around $4 million.

So how does one lower their churn rate? By arming help desk and technical support employees with the right strategies, tools and analytics necessary to offer proactive support through a variety of channels.

Offerings like Alcatel-Lucent's new customer experience transformation solution, dubbed ServiceView for Mobile, gives service providers end-to-end visibility and control across their entire service delivery chain. This enables help desk and technical support personnel to prioritize, troubleshoot and resolve problems quickly and efficiently.

In addition to streamlining technical support operations, ServiceView for Mobile generates upsell opportunities and helps deliver a richer, more satisfying smartphone experience.

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