Perhaps the biggest challenge while penning (yet another) article on customer experience and value management (CXM) is not repeating oneself. After all, how does the audience stand to gain from reading ad nauseam about how defining a sound CXM strategy is a good idea? Or, for that matter, how to best measure the success of such strategies?
The point is that one can only emphasize half a million times about how CXM is not a boxed solution. Here’s what ought to be highlighted instead; projects undertaken in one part of the world cannot and more appropriately should not be replicated as is in another. Each part is different and even within one, customer preferences vary greatly compared to those in the same region.
The ASEAN Puzzle
The Association of Southeast Asia Nations (ASEAN) is an interesting example in this context. For one, the region is a mix of contradictions. Take, for instance, customer segmentation. The region not only houses an array of cultures, but multiple income levels across varying geographies as well. In other words, the customer base in this region may well be considered a pyramid-like structure. Customers belonging to the middle-class and international corporate segment are demanding advanced services. These are perched atop a large base of low to-middle income consumers in both urban and rural areas. This segment largely leans towards prepaid services. Overall, the region displays medium to low average revenues per user (ARPU). Meanwhile, some markets are overly saturated, with penetration rates greater than 100 per cent.
Naturally, then, operators have their work cut out for them. A difficult task, no doubt, especially since these players have, by and large, stuck to traditional methods. The classic ARPU model is still the benchmark, as opposed to focusing on improving overall share in the customer’s wallet. Likewise, they choose to
stand apart from the competition by offering a vast service bouquet, priced very competitively.
The catch here is that these methods (while sound in their own right) aren’t really relevant anymore. Customers today are no longer impressed by a differentiated service bouquet-this is now considered a given. Optimum quality of services is a prerequisite, as is value for money. Factors such as data speeds, service quality and minimum response time are what make customers tick. As a brief side-note, it would be worthwhile mentioning a recent customer survey carried out by Bain & Company. The survey covered prepaid customers in the five largest economies in the region- Indonesia, Thailand, the Philippines, Malaysia and Singapore. The results suggested that this customer segment wanted strong voice connections with no dropped calls, fast video downloads and hassle-free social media access. In other words, usage experience was the most important factor influencing how they viewed the operator, above value for money, plan selection, service and corporate image.
Operators, please sit up and take note. Merely slashing prices will no longer ensure you a seat at the leader’s table. Ensuring a differentiated and optimum customer experience will.
What Ails Operators in the Region
Why operators in the region ought to focus on CXM is simple. Customer expectations have increased manifold, especially as an operator’s network expands to include high-sensory applications such as music and video. In this context, operators have to ensure that these experience-led applications function effectively on their networks. In fact, CXM itself has increased in complexity and functionality. This, in short, makes it more important to deploy tools and capabilities to effectively manage customer interactions and touchpoints.
So, the challenges facing operators in the region broadly include:
- Low Efficiency: Cost efficiency and service quality is what makes all the difference.
- Improved Productivity: These players require decluttering of their service bouquet.
- Varied Focus: Operators by and large tend to focus on post-paid subscribers, even when the market itself is predominantly prepaid. This is because the former mean higher ARPUs and retention levels. This, however, may not prove effective in the long term.
Here’s where advanced analytics and machine learning step in. CXM-driven service modelling and offering personalized services in real-time is the ideal way forward in ASEAN. The idea is not to add more services but to zero down (and
focus) on what the customer really wants. The ARPU may not register a meteoric increase, but the potential to enhance revenue is significant.
Operators would do well to remember one crucial point. It isn’t about how much data is available or how frequently it is refreshed and processed. It is about garnering actionable insights from that data plie. Making sense of that data and leveraging that for customized and real-time marketing to drive customer experience. The bottom-line is for operators to keep in mind that the scope of CXM itself is very broad. The idea is to drill it down to specific domains, sub-domains and use cases, one that best provides the most optimal return on investment.
Measuring the Success of CXM Initiatives
Overall, while the measurement mechanisms vary and are usually not very standardized, Net Promotor Score (NPS) is still a critical metric. This is most commonly used by operators to assess the outcome of CXM projects. Simply put, it is externally referenceable, customer-sourced, and can be applied at the brand, product and business process levels.
Of course, all organisations have a series of metrics derived from systems and business processes to track performance. These are typically correlated with NPS to identify drivers for improving the same.
Net, net, the telecom game is no longer about how much a customer spends on an operator’s network. It’s about how long they stay on your network. Deploying a CXM strategy will certainly help an operator keep their ears to the ground. After all, isn’t knowing what the customer wants the bottom-line?