Most operators around the world would admit the relationship with customers has traditionally left a lot to be desired.
However, a concerted effort across the industry is beginning to change this unwanted reputation for the better.
Driven by another one of the industry’s latest buzz phrases, operators are aggressively pushing digital transformation across their businesses, with improved customer experience at the heart of their thinking.
A report by consultancy McKinsey this time in 2016 said digitisation offers telecoms companies “an opportunity to rebuild their market positions, reimagine their business systems and create innovative offerings for customers”.
And a more recent McKinsey study on the subject, in many ways, summed up the long-term value of operators incorporating better digital practices.
In February, just before Mobile World Congress, a survey indicated more than half of European subscribers wanted to deal with providers only through digital channels. In the US, more than a third of subscribers were open to strictly digital interactions.
Aside from giving the customer what they want, such an approach could also boost sales, reduce costs, improve customer engagement and have a favourable impact on efficiency.
With Apple now also offering their own upgrade programmes on iPhones, convincing the customer to stay loyal to their operator contracts may prove vitally important long-term.
However, the road towards this transformation will be long, and equally complex.
In its February report, McKinsey observed “mobile operators lag behind companies in some other industries in doing business digitally”.
So, what is being done?
In the six months following the consultancy’s observation, three apt examples have been presented where operators showcased an obvious intent to improve their processes and the way they engage with their customers, with positive results.
Take Sweden-based Telia, for example.
The company, which recently partnered with device care service provider eBuilder to enhance the value of its own mobile app, told Mobile World Live it achieved “staggering improvements” in customer engagements in the last six months.
Telia’s app, which provides contract customers with push notifications about battery health, storage limits and tips and tricks on how to use their phones, was downloaded 100,000 times since its launch in March.
Gustav Berghog, Telia’s product and commercial director, explained providing device care was one of its ways of staying relevant, while the increase in customer engagement helped with loyalty and reducing churn.
In a press briefing dedicated to this very subject in July, Vodafone UK opened up on how it was using artificial intelligence (AI) and voice recognition to emerge as a “leading digital company”.
As part of the push, it integrated such technology within its customer service operations to improve the way it interacts with customers, as well as enhance its overall brand reputation.
During a briefing, Vodafone UK showed how customers can use its app to make queries and lodge complaints by talking directly to agents through messaging, as well as unveiling 24/7 customer service across Facebook and Twitter.
Vodafone developed TOBi, an AI-chatbot, to deal with account specific questions, which it claimed can “understand what a customer needs help with more than 90 per cent of the time”.
From TOBi to Telefonica’s Aura
Telefonica’s chief data officer Chema Alonso told Mobile World Live earlier this year its chatbot-based customer service agent Aura had 350 million users worldwide.
Aura can deal with service queries including bill clarification, and deliver information on new services. Ultimately, Alonso said, Aura allows its customers to get things done in “real time”, and provides “full transparency” of Telefonica’s services.
Transform to survive
The examples from Telia, Vodafone UK and Telefonica highlight operators’ broader ambitions to digitally transform their businesses from top to bottom.
And at Huawei’s recent Operations Transformation Forum in Hong Kong, digital transformation (as you might expect) was a major theme.
Bouke Hoving, KPN’s EVP of networks and IT, said there should be no compromise from operators between enabling cost efficiencies and customer experience improvements in the journey towards modernising their businesses.
“When I started, I said if I only delivered the savings, I would consider the programme to be a complete disaster and failure. Because ultimately, what this transformation is about is a step change in customer interaction,” he said.
At the same event, Hong Kong-based HKT added further weight to the importance of transformation, with group MD Alex Arena stating modernisation was really the only way for its “business to survive”.
He said customer behaviour was driven by service industries in particular, as airlines and hospitality have now set the standard for what customers expect.
“We had to stop being network centric, we had to start being customer centric. In some respects the technology takes care of itself. The toughest part is the customer side,” he said.
Go all in
Clearly, there is obvious intent from operators to improve the way they deal with customers.
By introducing over-the-top services like device management and AI-based chatbots, they may well see an increase in loyalty, a reduction in complaints, a potential boost in sales and, eventually, lower costs.
In its report, McKinsey identified four major areas operators should consider, as part of their efforts to use digital to “streamline operations and please customers”.
Digitisation of customer support (the use of AI-based agents TOBi and Aura for example), automation and simplification in the back office (adopting machine learning processes to cut the cost of labour intensive processes), predictive analytics in sales and marketing, and machine learning in customer retention (using intelligent data to keep customers loyal) are all techniques to start the next great mobile business transformation.
But, taking a selective approach to these processes could result in limited impact. Operators, as KPN’s Hoving suggested, need to go all in.
The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.