The new customer strategy
Over the years, telcos across the globe have relied on aggressive short-term promotions to attract new customers. This strategy, though effective in the short term, doesn’t result in long-term benefits: Customers—especially those in high-churn markets—happily change providers when they find the next attractive deal. But most telcos feel stuck with these tactics because they’re under pressure to meet their quarterly revenue goals—which puts them in an endless cycle of hunting for new customers.
Looking at the Net Promoter Score (NPS) rankings across industries, the telecom industry has been one of the poorest performers in the past five years, with scores well under 50 meaning low customer affinity. The only way they can boost their NPS score is if they pivot their short-term, product-centric customer strategy to a longer-term and customer-centric approach wherein customer experience and impact drives product decisions. Fortunately, recent unprecedented events have created an opportunity for telcos to break out of the cycle and shift their mindset from viewing customers as a transactional unit to treating them as a long-term strategic asset.
In this new customer strategy, customer cohorts are regarded as an asset to an organization, they’re loyal to the company’s services and products, and even serve as an ambassador for the brand.
Telcos must make the strategic decision to invest in the people, processes, and technologies they need to build immersive products and services driven by robust operations and supported by seamless and empathetic customer support. The return will be longer-lasting relationships with more customers who buy more from the company—an end result that every company wants.
Building a customer-focused telco
What’s the answer for telcos? Clearly, they have significant challenges that can’t be eliminated overnight. But eliminate them they must, if telcos are to successfully embrace a customer-centric approach to the market and become a "customer-focused telco." That journey requires improving the buying, in-life and usage, and customer support experiences that are critical to nurturing customers as valuable assets instead of treating them as transactions.
The way forward
In the telecom industry, there’s a high-stakes battle being waged for customers’ attention and money, and that battle is set to define what the industry looks like for years to come. What role traditional telcos will play in that future will largely depend on how effectively they can move from treating their customer base as quarterly KPIs to treating them as long-term assets they nurture over time.
It’s not an easy transformation to make, given the long-held practices and behaviors in most telcos, as well as their organization siloes and legacy systems. Having customers at the center of a company’s operations requires significant changes across a telco’s commercial, operational, IT, and financial capabilities. But telcos don’t have much choice. If they don’t make this change, other companies will step in to fill the void. Telcos need to act, starting now, to create a new customer-centric business that positions them to more effectively compete for—and win—the customers of today and tomorrow.