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Big Data, Churn, Customer Experience Key Challenges Facing Telecoms

Jim Tierney

Loyalty 360

Big Data monetization, churn, and customer experience are among the fastest growing challenges facing telecoms heading into 2014, according to Experian’s international survey of leading executives in the telecommunications industry.The survey included 80 senior executives from 45 telecommunications companies in 22 countries. Executives were asked to provide insight into the most pressing issues. A similar survey was conducted last year and the results have been compared to identify leading trends in the major issues affecting telecommunication companies over time.

Here are some of the study’s key findings:

The number of respondents citing Big Data monetization as a major challenge for telecoms operators has increased by 150%, compared to 2012, making it the biggest riser compared to other challenges

37% of respondents said end-to-end customer relationship management is their most significant business challenge — compared to 37% last year who agreed — suggesting that this challenging issue remains a tough one to solve.

32% of respondents said that reducing churn was the most critical factor in improving margins (compared with 26% in 2012)

Selling additional services to existing customers is also identified as important (29% vs. 19% in 2012)

Winning profitable customers (24% now compared with 21% in 2012) is also a priority highlighting the trend away from pure revenue (ARPU) view of the world to incorporate Average Margin per user (AMPR) and Customer Lifetime Value (CLV)

Nearly 40% (37% in 2013 compared with 30% in 2012) said improving the quality of decision-making throughout the customer lifecycle will provide the greatest benefit to their organizations, along with using external data to enhance their understanding of customer value relative to potential risks.

10% of respondents felt combating fraud posed a growing challenge heading toward 2014.

7% of respondents said automating a greater proportion of customer decisions and interactions continues to be important

“Our experience tells us that concerns around reducing churn, improving customer experience, and developing cross-sell opportunities are very closely interrelated,” Antonio Valasquez, Corporate Risk Director at Telefonica, said in the report. “The pressures of market saturation combined with the drive to reach new customers and improve profitability, means telcos are having to rethink substantial elements of their strategies. This demands not only self-criticism, courage and effort, but also new and better customer information, analysis and insights.”

Tim Barber, Strategic Development Director, Experian Decision Analytics, added: “It is no surprise that Customer Experience, Big Data, and Fraud have been identified as serious challenges for telecommunications companies. The telecoms industry has access to vast amounts of data, and is rapidly understanding how this data can be mined to improve business performance in these critical areas.”

Barber added that young, urban, and tech savvy consumers are increasingly seeing mobile as their primary medium for engagement with organizations and brands.

“This research provides consumer insight into the growing demand for more attractive and interactive mobile services such as touch-and-go payment, snapchat SMS messaging, and the need for service providers to capitalize on this demand to drive their growth.”

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