With next-generation networks in place and 3G devices becoming more widely available, European telecom operators are facing new challenges with respect to All-over-IP, service orchestration,
changing paradigms, business transition, Push-to-XYZ – and whatever else comes to mind as the most important thing to tackle next. Regardless of the viewpoint you take, it will be rigorous customer orientation that will determine the future prosperity of telecoms providers. And the overall improvement of customer relationships and direct customer interaction will be key, says Mathias Liebe
Before we explore the realm of real-time, I would like to quote something I found in the prologue to Tom Peters’ book A Passion for Excellence, a book that truly inspired me, and that I recommend to anyone who is seeking answers to complex questions. It can also be understood as a guiding theme through this article about real-time capabilities and the sometimes hidden ‘obvious’.
“In the following pages I offer nothing more than simple facts, plain arguments and common sense...” - Thomas Paine - Common Sense, 1776
Many industry experts are seeking success in strategies aimed at transforming telcos into retail-like companies which, instead of selling communications services, focus on content and entertainment. Almost no telecommunications conference goes by without someone envying the big retailers of this world, who supposedly have decoded the genetic code of consumer buying behaviour. Retailers who have identified literally thousands of different segments that should be individually targeted, doubling weekly sales based on optimised statistical usage cluster analysis! Is that so? And are retailers really a relevant benchmark? Are they really doing better? The fear of becoming a pure bit pipe seems to be omnipresent, and the latest hype called IMS will spur the old discussion about the value chain unbundling once more.
So why do telcos not just copy retail strategies? Because their CRM and billing systems cannot cope? No, certainly not. So what is important and what might be the right thing to do in times like these? Times in which objective product differentiation becomes more difficult, and a compelling service offering is often seen as a mere prerequisite to compete. Remember this: it’s all about customers and ways to improve real-time customer interaction on all levels. Let that be at the point of sale – wherever that might be for a mobile operator – after sales or when services are billed, either online in real-time or when the invoice arrives.
At this point marketing strategists usually call for customer loyalty and retention strategies based on scientific approaches, including so-called ‘perceived value’ concepts, methods to ‘shape an image’ perfectly matching the targeted audience thus creating ‘sustainable brand awareness’! Hey, don’t we all like, and sometimes even admire, those advocates of change and success? But what does that all mean to an existing customer of a mobile operator in real life? And are there no instant – let alone pragmatic – alternatives to improving customer relationships? Please don’t get me wrong: I am a whole-hearted marketer myself, and I believe in targeted customer and segmentation strategies. But I also believe in common sense, excellent service and the often neglected alternatives which somehow seem to be hidden behind the curtain of the obvious.
Obvious opportunities and courtesy
Here are two examples. I have just changed to another mobile service provider. Bluntly speaking: Yes, I have churned, and I declare myself guilty on all charges. But do I see a difference between two operators? To be honest: No. Both seem to seek their salvation in sending information leaflet after leaflet whenever I get a bill. So does a brochure really make a difference? And to make things even worse: Did I ever bother to read the brochures?
Here is another thought-provoking story that someone shared with us recently. A businessman spent literally hundreds of euros per month due to extensive usage of international roaming services. Did his operator ever respond, recognising that he is a valuable customer, let alone to say: “Thank you for letting us connect you with your business partners while travelling!”
At home over the weekend the same businessman downloaded a music file from an Internet service provider. After the successful music download worth only 1.99 euros the business man received an instant thank you note and more useful information about the price he paid, related offerings as well as details on how to contact the company in case of complaints. In other words a simple but perfect service with ‘A passion for excellence’!
The key question for telecommunications companies is how to get there and where to start. Well, a retailer would answer this question in a split second and formulate the answer around the PoS (Point of Sale) where customers choose goods and pay for them. For mobile operators this is fundamentally different, because service usage and payment can occur virtually anywhere. So it more or less boils down to an MoS (Moment of Sale) rather than a physical location. It’s not the place but the moment in time that is relevant as the starting point to address your customers. And this is exactly where real-time capabilities come in as a most promising enabler: the key to a positive user experience lies in enhanced customer interaction based on behaviour – and payment – related issues at the exact moment when it is happening. And that is regardless of whether you are a prepaid or a postpaid customer. Today’s consumers demand an instant reaction or dialogue. They will not maintain interest or be willing to accept delays measured in hours or even days.
So where does this magic real-time capability come from, and what can operators do with it? Real-time functionalities have their origin in the IN prepaid payment arena, in which available credits and quotas are managed in real time to assure that prepaid customers have sufficient credit to pay. So until about 24 months ago, when speaking about real-time, people only associated it with a payment mechanism for a special clientele. Today this has changed, and the potential benefits of doing business in real time have outgrown aspects of pure revenue control.
Nowadays real-time is seen as an enabling tool for creating better customer service, instant dialogue and a major gain for operators in terms of flexibility. Here are some examples in which added real-time capabilities make a decisive difference. For closed user groups like companies or families that fit in with ‘lifestyle or hierarchical billing’, real-time features introduce several levels of spending and service usage control. In addition, real-time bonus and discount schemes can be implemented easily and – best of all – communicated instantly at the Moment of Sale.
Real-time to the rescue
The need for enhanced service management together with greater payment and pricing flexibility on one side, and the ongoing initiatives to streamline the existing IT/BCC landscape on the other, are the main drivers for deploying sophisticated real-time solutions for convergent customer interaction. Many operators are starting to invest in real-time capabilities, focusing on real-time processing to open up and protect revenue streams while gaining more flexibility regardless of the payment method. With respect to third party content business, real-time features might also help overcome a dilemma that the industry is currently facing. Something over 70 per cent of all content is sold via premium SMS outside the operators’ service delivery domain. Many content offerings are linked to hidden subscriptions, leading to several recent lawsuits and disappointed customers.
More sophisticated DRM and related billing concepts have not really emerged yet, so that pSMS will stay around for some time. Knowing that pSMS is inherently not a trustworthy and reliable payment method, added real-time communication and charging capabilities could be an answer.
Combined with ‘opt-in/opt-out’ best practices guidelines published by the MMA (Mobile Marketing Assoc.) and the MEF (Mobile Entertainment Forum), this could be a perfect way to regain the consumer’s confidence, to increase legal certainty and to prevent revenue leakage.
In the past, real-time and IN-based implementations have been mostly proprietary, with CAMEL being the only exception. Now more standardised AAA procedures and protocols are emerging, with DIAMETER taking the lead as the most promising real-time enabler. But instead of arguing whether the IT- or IN-based school of thought is better positioned to support operator needs in improving customer relations, one should focus on key capabilities – regardless of where they originate.
Managing money and improving customer interaction is neither black nor white: it is always unique to each operator and must be truly customer-centric. The one thing that really matters is leveraging the right enablers, and one of them is the real-time capabilities that have already emerged and are definitely here to stay.
Commodities and common sense
But to get back to those who are in search of excellence and do not really believe that voice is ‘just a commodity’ and that only data services will make an impact (let alone that they will sell themselves), why not try to come to grips with real customer expectations when they occur (MoS)? Why not practise some ‘common sense’ to find the obvious opportunities to make the user experience perfect.
Mathias Liebe is Product Marketing Manager Billing, ORGA Systems, and can be contacted via e-mail: email@example.com