Home Customer Value Management Proactively Connecting With Connected Customers and Addressing Telecom Churn

In the highly competitive telecom markets of today, characterized by multiple operators and free flow of product related information, operators must wake up to the reality of telecom churn and devise contextual marketing strategies for retaining their “at risk” customers, using real time intelligence and predictive analysis.

GSMA intelligence reports that the threat of telecom churn is real, with no signs of abating anytime soon. In the period between Q4 2014 and Q1 2016, ARPU dropped from $20.25 to $19.58. In Q4 2014, the number of SIM cards for every subscriber came to 1.8. Though GSMA Intelligence remains tight-lipped on the subject, they have mentioned that churn rates stood at 3.22 per cent in Q4 2014. Compounding this problem is the rise of the OTT vendors who have started eating into the revenue and profits of telecom operators all around the world.

Any strategy to deal with this threat must have four distinctive elements: identify, design, execute, analyze.

Identify “at risk customers”

Operators must put in place proper mechanism for identifying “at risk customers” by using various indicators like usage, mobile switch on/off time, outbound calling, drop in activity etc. Depending upon the perceived threat level based on the aggregate score of the risk parameters given above, the operator targets customers with contextual offers.

Design dedicated package for “reactivation”

Once the risk has been assessed and the threat identified, the operator should try to win-back the customer with deals that are contextual and customized to the customer’s needs and wants. The retention package should be customized according to various “what if” scenarios: What if the subscriber is inactive for greater than seven days? What if the subscriber switches on the mobile only during the night? What if the subscriber only uses the mobile for SMS? For the above “what if scenarios” retention package could be designed on the following lines: “Dear customer, top up XX and get double talk time” or “Recharge XX and enjoy SMS and free browsing from 12 PM to 6Am” or “Recharge XX and enjoy 100 SMS and 10 minutes of voice calls”

Execute “customer retention strategy”

Operators have to be proactive with their “at risk” customers or deal with re-acquisition costs which can be as much as five times the retention cost. This means targeting customers before they have churned. Real time tracking of the customer’s activity and delivering the campaign at the right time using multiple channels can go a long way in mitigating the risks associated with customer churn. Real time marketing campaigns are more effective as they are delivered the moment the customer switches on their mobile phones.

Analyze campaign results

The success of any customer retention strategy depends on tracking their ROI on a continuous basis. Based on campaign results, retention packages can be customized even further, improving ROI.

Dealing with customer churn requires strategic thinking. In the highly competitive markets of today, operators have to go beyond connecting with their customers. In order to stay competitive, they have to measure various metrics of customer activity, deliver highly personalized marketing campaigns running in a real time environment, analyze campaign results and keep improving on their marketing ROI all the time.

By running real time marketing campaigns, the operator can bolster their revenue stream by recapturing revenue from dormant customers, reselling to existing customers, pre-empt activity drop and revenues. On the cost front, operators can save time and cost in acquiring new customers, stop campaigns with poor ROIs, and optimize their marketing dollars by running data driven marketing campaigns.

In such a data driven environment, it is a win-win situation for the customer as well as the operator. The operator is able to reduce customer churn and the customer benefits by getting access to highly contextual offers personalized to their needs and requirements.

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