Kaj Hagros, CEO of back office vendor Tecnotree, discusses the results of the company’s new whitepaper "Unravelling what makes a mobile customer loyal", including how mobile operators can keep customers, minimise churn and why they need capitalise on LTE to do both.
Eurocomms.com: What are the key findings from the research? What surprised you?
Kaj Hagros: Well, it revealed that operators are out of kilter with subscribers; that there is a disconnect between what they think keeps today’s mobile subscriber loyal and what actually does. The report also highlighted the importance that customers place on access to LTE and how pressing it is that operators are transparent on their plans for roll-out.
How have operators got it wrong at present? What does this disconnect look like in actual terms?
According to the findings, CSPs see a combination of factors contributing to customer loyalty and churn, and not one sole product or service. Yet from the consumer point of view, it transpired that consumers focus on one aspect of their mobile service as defining how happy they are with the network provider – better tariffs (24 percent), device upgrades (21 percent) or bundled services (15 percent).
Above all though, the report highlights that LTE is the glue that cements a customer’s loyalty with a mobile operator. The introduction of LTE has the power to drive success and boost ARPU so operators need to be aware of just how much this will sway consumer preference.
According the survey results, 59 percent of people claim they would leave their current provider if a rival mobile operator was offering 4G and their existing mobile operator was not.
Yet while this may leave operators that are late to provide LTE in the lurch, there is some good news. That’s because over 60 percent of mobile consumer respondents claim that they will increase their spend on non-communication services when they own an LTE device. This tallies with the fact that almost 48% of mobile operators believe that LTE will increase consumer data spend.
What were the survey’s other major findings?
The research also revealed that 94 percent of respondents believe they are loyal to their operator, with those in Nigeria (97 percent), South Africa (96.7 percent) and the UK (96.3 percent), claiming to be the most loyal – this naturally is good news to us, since Tecnotree has a strong presence both in Africa but also in Europe, our home market.
However, over one-fifth have changed mobile operator in the last six months, and a similar number intend to churn in the coming months. This implies that at any-one-time, there is a settled subscriber base of 50 percent.
It also showed that the longer a customer stays with a mobile operator, not only does their loyalty increase, but their propensity to spend on non-communication services increases – by over 20 percent for almost one-fifth of subscribers.
Is there any clear advice for operators that the survey points too?
Yes. Operators need to ensure they are continually being innovative and competitive - whether with tariffs, services and even the handsets to keep customers signed up. This is where really knowing the individual subscribers counts and will bear dividends.
In fact, this exactly what Tecnotree is evangelising today; have insight of your subscribers available on the operational level and make sure it can be acted upon, because only with this you are in a position to offer those relevant and real-time deals and reduce churn.