Transitioning to a customer-centric approach
by Josie Sephton and Dale Vile
The mobile service provider market is increasingly characterised by high levels of competition, with providers dealing with the dual challenge of reducing churn and moving customers up the value chain. Against this background, is the traditional product-centric approach to marketing still adequate, or is it time to put the relationship and dialogue with the subscriber at the centre of our thinking and activity?
Against the backdrop of an increasingly dynamic market landscape, where prepaid services have helped position mobile as a mass market service, senior marketing professionals in the mobile provider community are increasingly aware of the potential that exists by developing this traditionally lower-spending segment. Similarly, across the spectrum of their pre-paid and post-paid customer base, they are looking at initiatives to encourage more customer loyalty. Emphasis is being placed on taking a more customer-centric approach, highlighting the need for ongoing communication with subscribers that will both enhance their perception of value (and thus their level of loyalty), and encourage them to take advantage of the services on offer in a broader and/or deeper manner (to drive up revenue and profitability). In order to achieve this, there is a need to:
- Understand the customer through advanced segmentation techniques
- Match products and services to customer micro-segments in an informed manner
- Determine or create synergies between offerings to drive cross-selling and up-selling
- Execute an integrated programme of targeted interactive campaigns that collectively enhance and exploit both the customer relationship and service synergies over time
Yet most of the 13 tier 1 and tier 2 mobile service providers represented on a panel that provided in-depth feedback to Freeform Dynamics during a recent study into this very subject alluded to problems in the following areas, to one degree or another, indicating some significant constraints and capability gaps:
- Customer data limitations
- Inefficient campaign setup process
- Limited real-time response capability
- Inadequate reporting/monitoring capabilities
These typical shortcomings have a significant business impact ranging from cost and efficiency issues through time-to-market and competitive response constraints, and ultimately to challenges with customer profitability and retention. Within this report, we explore the issues that exist in more detail, then go on to discuss some of the ways in which they can be addressed based on feedback from panel members we engaged with as part of this study.