CRM: Improved, Immediate, Individual
GSM>3G Vision

June 13, 2007

It's hardly news that mobile operators are currently struggling with the twin problems of customer retention and generating increased revenues from the customers they manage to keep. However, Yair Sakov, VP marketing and business development of FTS, a provider of business control, billing and CRM solutions for communications service providers, feels that these two issues could be resolved with the same solution. To do this, however, operators need to take a new approach to fulfilling the needs of their customers.

"The key to customer retention is to provide a compelling and differentiated mobile experience for each individual," says Sakov. "Customers should have the sense that the provider 'understands' their needs and that the service offers are relevant to them."

The point to remember here is that the main value of mobile services is immediacy, Sakov argues. "A customer wants something - voice call, SMS, video clip - they get it there and then," he says. "This is based on enabling real-time customer-service interaction." Thus, he suggests, providers can leverage this immediacy to deliver new services or service enhancements (like real-time offers) as well as improving the actual service experience in real time (like modifying QoS for video). "The customer would get a sense of personalisation and control over their services and the result would be higher stickiness of services and higher loyalty to the overall provider brand," Sakov says.

Improved CRM is the aim and finding ways to deal with customers in this real-time way, based on the buying and usage habits that they already display, is a way for operators to achieve it, he suggests. "Once a user hits a certain threshold of usage, or performs a specific action, operators need to be able to react and create a dynamic offering that reflects the behaviour just displayed," he says.And this doesn't need to be complicated. It could, for example, involve creating loyalty points that are instantly credited and can be redeemed in seconds, or offering a free download when a certain threshold, such as €10 on data, has been crossed. Alternatively when, say, a film-based mobile game or film clip is downloaded by the customer, operators could offer that film in the form of a VoD on IPTV service. The result, claims Sakov, is "a personalised impression of customer service that has huge benefits for both operators and customers".

However, he warns: "Retention improves if you target customers when it is appropriate to them, not you. Operators need to track the actions on their network and respond to them before the information is deposited in the billing and OSS system. If the reaction is in real time then they can dynamically adapt network or service behaviour at the customer level. Once the information is deposited in billing and OSS databases, it becomes harder to retrieve and any offers made to the user become out of date or irrelevant."

He adds that this approach allows for two distinct benefits: firstly, new services can be created based on the real-time interaction with the customer; secondly, the actual service being rendered can be enhanced. For example when a customer is looking to watch a premium-priced newscast, they expect a certain level of service. If QoS can be instantly improved to meet that expectation in real time, providers have a better chance of retaining the most valued customers.

Of course real-time customer interaction may be costly but Sakov has an answer for this too. "Operators should target systems that are delivered as an add-on to existing billing and OSS systems," he says. "This enhances existing systems by providing additional real-time capabilities not currently available, reducing the operational risk of integration and of negatively impacting existing services or otherwise affecting the billing system."

There is a further benefit: measuring the ROI of these new systems should be easy as the increase in retention can be attributed to the real-time customer interaction. Additional revenues can also be directly attributed to the investment. "In one recent implementation by FTS," says Sakov, "an operator reported a payback period for the solution including software, hardware, and professional services to be less than 12 months."

This article first appeared in the weekly e-zine GSM>3G Vision, published by Informa Telecoms & Media. Subscription information:
http://clients.adestra.com/informa/gsm3g_vision_update.html