customer experience

1 The drive to enrich customer experience

Customer experience moves to pole position

The drive to enrich customer experience

The business benefits of enriching customer experience:• Higheroperationalperformance• Increasedprofitability• Competitivedifferentiation•Newservicerevenues• Positiveimpactonbrand


Itisasignofthetimes–communicationserviceproviders(CSPs)arestartingtoemphasizethequalityoftheirall-roundcustomerexperienceratherthanjusttherawspeedsorothertechnicalfeaturesoftheirofferings.TakeO2–intheUKithasbeenadvertisingitsHomeBroadbandserviceas“votednumberoneincustomersatisfaction”.Meanwhile,Vodafone’sCEO,VittorioColao,toldinvestorsinlate2008thatoneofthecorepillarsofitsstrategynowisto”…drive operationalperformancethroughcustomervalueenhancement”. Overall,accordingtoresearchbyNokiaSiemensNetworks,amajority ofCSPsaretakingstepstobecomemore‘customer-centric’andput deepercustomerinsightattheheartoftheirplanstoprovidemorevalue.

CSPsarerecognisingthatcustomersarebecomingfarmoredemandingaboutrelationshipswiththeirprovidersascommunicationstechnologybecomesanintegralpartoftheirlives.CustomersaregainingmorepowerfornegotiatingtermsandconditionswithCSPs,whilesocialmediaenablespeopletoshareopinionsandopportunitiesandhelpeachothertomakedecisions.Customersarebetterinformedandmorediscriminatingabouttheirsuppliersthanever.

Inmostmarkets,increasingcompetitionmakesitdifficultforCSPstodifferentiatethemselvesjustthroughapplications,tariffsandpricecampaigns.AsHamidAkhavan,chieftechnologyofficeratT-Mobile,comments:“Itisnotaboutthekillerapplication,butthekillerexperience.”

The drive to enrich customer experience

Remarks by Vittorio Colao, Vodafone’s CEOWe will drive operational performance through customer value enhancement, rather than revenue stimulation, and cost efficiency. Valueenhancementinvolvesmaximizingthevalueofourexistingcustomerrelationships,notjusttherevenue.Wewillshiftourapproachawayfromunitpricingandunitbasedtariffstopropositionsthatdelivermuchmorevaluetoourcustomersinreturnforgreatercommitment.Thiswillrequireamoredisciplinedapproachtocommercialcoststoensureourinvestmentisfocusedonthosecustomerswithhigherlifetimevalue.We are confident that by targeting our offers, we can deliver more value to our customers and have a better financial outcomeforVodafone.Customervalueenhancementreplacesrevenuestimulation.


Therecentglobaleconomicdownturnisputtingfurtheremphasisontheroleofcustomerexperiencemanagement,intwoways.First,focusingmorecloselyoncustomersboostsoperationalefficiency,asbetterunderstandingoftheirneedsallowsCSPstotargetinvestmentandresourcesmorepreciselytomatchtheseneeds.Second,CSPsarerecognizingthattheyneedtofocusmoreonretention,tomaximizethelifetimevalueofeachcustomer.

Indeed,agrowingnumberofplayersareusingsuperiorcustomerexperienceasameansofcapturingcustomersandstrengtheningloyalty.AsVodafone’sCEOstates,toincreaseprofitabilityitisnecessarytofocusinvestmentsoncustomerswithhigherlifetimevalueandenhancethevaluetheyget.Superiorcustomerexperienceiscriticaltodrivingthisvalueintoday’smarketsanditisakeydifferentiatoramongCSPs.ItisastrategyconfirmedbyanalystOvum:“Broadlyspeaking,telcosoffercomparableproductsandservices,sogoodcustomerserviceandpositivecustomerexperienceareamongthefewavenuesfordifferentiation.”

Apositivecustomerexperienceisalsocrucialfornewservicerevenues.AsJozefChyznaj,packetcoreengineeringmanager,OrangeSlovensko,highlights:“Ifourdatacustomerscannotusetheirservicesaftertryingtwoorthreetimes,theywillfindanothersolutiontoretrievedata.”

Butwhatexactlyareallthefactorsthatcomprisecustomerexperience,howdotheyimpactonCSPperformanceandmostimportantly,whatactionscanbetakentoenrichtheexperience?

An essential component in building sustainable and profitable relationships with customersCustomerexperienceisamuchwiderconceptthansimplycustomerservice,billing,networkandservicequalityoranyothersinglefactor.Instead,itincludesalltouchpointswiththecompanyandallaspectsofacompany’sofferingandiscriticalforacustomer’sperceptionoftheCSP.Improvingtheperformanceofthedriversthatinfluencecustomerexperiencehasadirectimpactonprofitability,newrevenues,differentiationandbrand.Butwhatarethekeydriversaffectingcustomersatisfactionandwhatistherelativeimportanceofthosedrivers?

ResultsfromNokiaSiemensNetworks’marketresearchoncustomerexperienceinmorethan30marketsrevealindetailthefactorsthataremostlikelytoleadtocustomerschangingtheirprovider.Forexample,inamaturemarketsuchasFranceitisstrikingthatseveralfactors,includingpoorcustomercareanddataservicequality,arethreatstoretainingmobilecustomers(seefigurebelow).Incontrast,anemergingmarketsuchasIndiarevealstariffstructureandserviceofferingsasthekeydriversforimprovementformobilecustomers.

Meanwhile,researchfromOvumonfixedbroadbandmarketsshowsthatthereasonsforswitchingprovideraredominatedbycustomerserviceandadesiretoobtainabetterdeal–withtheactualserviceportfoliobeingarelativelysmallbutfastgrowingpartofthepicture.

1 NokiaSiemensNetworks,SubscriberInsightSurvey,20082Ovum,Howthetelcocanprovideanexcellentcustomerexperience,2008


Butwhilecustomerexperienceisanessentialdifferentiatoritcanalsobealargecostfactor.Themosteffectiveimprovementswillbeachievedbyfocusinginvestmentsonthedriverswithhighimportanceforcustomersbutwhichshowlowsatisfactionlevels(asshowninfigure1).Thechallengeistoidentifywhichareastoinvestinforeachcustomersegment,andtodosointhemostefficientmanner.

Basedonthismarketresearch,NokiaSiemensNetworkshasidentifiedfivekeydrivercategories:

Service and device portfolioCoversservicesthatareattractive,easytofind,buyandstartusing;servicesthatmatchcustomerneeds;devicesandcustomerpremisesequipment(CPE).

Figure1:Importanceofcustomerexperi-ence drivers versus satisfactioninmobilenetworksinFrance

Network and service qualityInmobilenetworksthisencompassescoverageandserviceavailability,serviceretainability(egcalldroprates),serviceperformance(egservicesuccessrateordelays),usabilityandsecurity.Infixedbroadbandthisincludesnetworkperformanceandcoverage,characterizedasusabledataspeedorbandwidth,stabilityandsecurity. Cost and billingIncludestotalmonthlycost,devicecost,perceivedvalue,costofsamenetworkcalls,tariffplans,andbillingclarityandaccuracy.

Customer careAfter-salesservicethatiseasy-to-contactandquick-to-respondandsolvetheproblem,includingcallcenters.

BrandIncludesreputationforgoodservice,understandingcustomerneedsandbehaviorandtrustworthiness.


ThelongertheCSPcankeephighvaluecustomers,thehighertheprofitability.Forexample,oneEuropeanCSPgainedrevenueandsavingsof€13.5millionayearjustbyretainingatargetedbaseof43,000customersanaverageof3monthslonger–purelythroughimprovementsincustomercare.

Managingcustomerexperienceinaholisticwayultimatelydrivesthewholebrandexperience–whichinthesedaysof‘Web2.0’iscommunicatedrapidlybysocialnetworkingsites.

TheCSP’sperformanceinthefirstfourdrivercategoriesdeterminesthewaypeopleperceivethebrandandthecompany’spositioninthemarket.Overall,customerexperienceisajourneythatstartsbeforeanactualpurchaseandcontinueslongafter.Duringthejourney,acustomerwillpassthroughseveralstages,eachofwhichcanhaveseveraltouchpointswiththecompany.Thejourneytranslatesintotheall-importantcustomerlifetimevalue(CLTV)figure,whichisessentiallytherevenuecreatedbyacustomer,lessthecostsassociatedwithacquisitionandservicedelivery.

Asimplifiedcustomerlifecyclemodelisshowninthediagram–andshowshowlifetimevaluegrowsandmaturesastherelationshipdevelops.AddressingthedriversandtouchpointsattherighttimesforeachcustomercangreatlymaximizetheexperienceandsodelivervalueforboththeCSPanditscustomers.

Figure3:customerlifecyclephases

Figure2.Thefivekeydriversofcustomerexperience


AcurrentchallengeisbuildingthecustomerdatamanagementinfrastructuretosupportaunifiedviewacrossaCSP’sorganisationthatdeliversthesedetailedcustomerinsights.Inasurveycarriedoutin2008byNokiaSiemensNetworks,ofseniorCSPexecutives(includingmobileCSPsandISPs),morethanhalf(53%)statedthatexistingcustomerdatadoesnotallowcustomerprofilingwhilealmostasmany(46%)complainedthatdataisnotbeinganalyzedquicklyenough.Inaddition,only14%oftherespondentshaverealtimecustomerdataanalysisavailabletothem.3

Moving forward Recognizingthecustomerexperiencechallenge,87%ofCSPsworldwideareseekingtoimprovecustomerinsightsoverthenext12months.MostCSPshaveyettoachievetheidealpositionofacross-departmentalandreal-timeviewtoconsolidateinsightoncustomer,service,network,device,chargingandbillingdata.ButitisencouragingthatsomanyCSPsareputtingmoreemphasisonintegratingtheirpeople,processesandsystemstobringtogether‘silos’ofinformationandaregainingmuchbetterinsightintocustomerexperience.

Indoingso,theyarebestplacedtoidentifyandactonthosedriversofcustomerexperiencethatareunderperformingfortheirtargetmarkets,asdetailedintheremainderofthispaper.

The customer insight challengeOfcourse,therearebarrierstodeliveringvalueandenrichingtheexperience,andoneinparticularisfundamental.AccordingtoastudybyBain&Coin2007,allindustries,notjusttelecommunications,sufferfromamajordisconnectbetweentheirownperceptionoftheservicetheyprovide,andwhatcustomersactuallyreport.Infactthedifferencecanbehuge–theresearchfindsthatwhile80%ofcompaniesfeeltheydeliversuperiorcustomerexperience,customersthemselvesreckonthatonly8%oftheirsuppliersdeliversuchanexperience.

Thewaytoclosethisgapisfirsttounderstandhowcustomersperceivetheexperience(ie,subjectiveinsights),andtocombinetheseinsightswithkeyperformanceindicatorsoftheservicedeliveryandcustomerbehavior(ie,objectiveinsights).ThenaCSPcanapplythecombinationtooptimizeallrelevanttouchpoints,focusingonthosethatareunderperformingfromthepointofviewoftheircustomers.

DetailedcustomerinsightsenableCSPsto:

• Payspecialattentiontothemostvaluable customersandbettertargetactivitiesatspecific customers,customersegmentsorgeographical locations• Understandcustomerneedstoincrease personalizationofeveryinteractionandmake customersfeelspecial• Optimizetheirprocessesandcreatebusinessrules basedonanalyticstoraiseoperationaland businessefficiencythroughthecustomerlifecycle.


Outpacing competitors with innovative, easy-to-use services and bundles.ThereisadirectcorrelationbetweentheattractivenessofaCSP’sserviceanddeviceportfolioanditsmarketposition.Thekeyissuesintheportfolioareaareasfollows.

Shaping the portfolio – many options to create irresistible packages TheInternetischangingthewaypeoplecommunicateanddealwithcontent–ithasbecomeaplatformonwhichactivecustomersconnecttoeachotherinsocialnetworksandshareself-generatedorselectedcontent.Peopleare‘alwaysconnected’andaremovingapartoftheirlifetotheweb.Customerbehaviorisbecomingincreasinglyindependentoftime,locationandcertaindevices,andthereisincreasinguseofmultimediaapplications.Atthesametime,peoplewanttosimplifytheirInternetexperiencetogainmorecontrolofthehugevarietyofservices,contactsandcommunicationchannels.Providing‘sticky’servicesthatpeoplewanttocarryonusingisthekey.

Findingthebestdeviceportfolioforeachtargetsegmentbasedoncustomerinsightsisalsocriticalfordeliveringattractivepackages.Thedevicesthatcustomersuseinthehomeandonthemovecontributegreatlytotheirexperience,soitisimportanttotargettherightdevicestotherightcustomersegments.

Thekeystrategiestotapintoandcombineare:

• The ‘media biz’ approach – offering premium content. Televisionisenteringanew phaseasthecenterpieceofa‘richmedia’ experience,wherevariousTVandvideoservices willconvergeandmergeacrosshomeandmobile devices.Astechnologyandservicesdevelop, customersarelookingforconvenience,availability andpersonalization–deepinsightintocustomersin eachmarketwillbecrucialtoofferingappealing contentbundlesandchargingstructuresthatwill createnewvalueforcustomers.Belgacom,for example,isoneCSPwinningwithtailoredIPTV packages,offeringmorechannelsmorecheaply thanitsrivals,andaneasy-to-controlinteractive digitalexperience,includingpausingandrewinding programs.

• The ‘longtail biz’ approach – personalized web. Usingasimpleinterfaceandeasy identitymanagement,CSPscanbecome aggregators,offeringpersonalizedwebaccesstoa rangeofapplications.CSPsarealsoforming partnershipswithapplicationserviceproviders– offeringthemplatformopportunitiesandlocal marketaccess.Waystoaddvalueincludecreating ‘mashups’ofdifferentapplications–combining servicessuchasFacebookwithpresenceand locationinformationthatisgatheredfromthe customerbasetocreateacompletelynew experience.Providersalsoneedtodevelop interfacesthatmakeiteasyforcustomerstoaccess andusetheservicestheywant.Forexample, T-Mobileissuccessfullyprovidingaconvenient singlesign-onforavarietyofpartnersitesand personalizedone-touchaccesstopreferredsites. Whencustomersareusedtosuchfunctionality, theyaremuchlessinclinedtogotothetroubleof changingtheirprovider.

• The ‘Internet biz’ approach – own communities and VoIP services. CSPsarelaunchingtheirown communitysites,presentingcustomerswithunified accesstoarangeofcommunications,messaging andcontentapplications,includingtheirownWeb 2.0applicationsaswellastheglobalfavorites.An innovativeapproachisthatofEuropeanmobile CSP,Blyk,whichoffersafreemobileexperience andcommunitytoyoungpeople.Inreturn,Blyk givesitsowncommunityofadvertiserscontrolled accesstothecustomerbase.

IwantservicesthatmatchmyneedsandpreferencesServicesmustbecoolandworkwell.Iwanttocombinemyownservicepackages.Servicesmustbeeasytofind,easytosubscribetoandeasytouse.Iwantaparticulardevice.4

Serviceand deviceportfolio

3NokiaSiemensNetworks,SubscriberInsightSurvey,20084 KeycustomerissuesrevealedbyNokiaSiemensNetworksandGartnerresearch


• The‘multi-screenbizapproach’–focusingon the customer instead of the access technology. Thisgivescustomersaccesstoawiderangeof servicesthroughanyscreentheyareusing– includingTV,laptopPC,smartphoneandhome phone.Forexample,individuallytailoredTV channelpackagescanbeviewedviaIPTVonan HDTVscreenathome,viamobilewhileonthe moveandofcoursealsoonaPC.

Tearing down the usage barriersToensuresuccessfulservicelaunches,CSPscantrackinrealtimehownewservicesareusedbydifferentsegmentstounderstandtheholisticcustomerexperienceacrossalltouchpoints,includinginsightsaboutusability,servicequality,contentandpriceperception.TheseinsightsenableCSPstooptimizemarketingcampaigns,offerings,servicequalityandcontenttokeepthetargetsegmentssatisfied.

Simplifyingservicediscovery,subscriptionandfirstuseiskey.Excitingservicescountforlittleifcustomerscannotfindoutmoreaboutthemandsignupandusethemeasily.PewResearchCenter’sInternetandAmericanLifeProject,forexample,reportsthatnearlyhalf(48%)ofadultswhousetheInternetorhaveamobilephonesaytheyusuallyneedsomeoneelsetosetupanewdeviceupforthemorshowthemhowtouseit.Serviceshavetoworkrightthefirsttime–otherwisecustomersmayabandontheCSPaltogetherandtherewillcertainlybemissedopportunitiestoup-sellotherofferings.Agoodexampleofa‘pointandplay’featureisaservicethat,withasingleclickonamobilephone,allowscustomerstouploadavideototheirpreferred video-sharingsite.

Otherexamplestoimprovetheserviceexperienceinclude:

• Targetedauto-provisioningforservicepromotions. Thismakestheserviceeasytodiscoveranduseby removingtheneedforthecustomertoinitiatethe subscriptionandsetupthedevicecorrectly• Automaticdeviceconfigurationwhencustomers changehandset;automaticdeviceandservice provisioningafterpurchasingaservice;automatic correctionofdevicesettingswhenneeded;over- the-airremoteapplicationandfirmwareinstallation andupgrades• Servicefulfillmentprocessesautomation,toensure thecustomergetstheservicewithintheagreed time,improvingthecustomerexperienceby eliminatingunnecessarydelays.

TheGridfromVodacomallowscustomerstochattofriendsandbrowsetheirlocalareafromtheirmobilephones.Theserviceenablespeopletolocatethemselvesandtheirfriendsonamapandshareexperiencesviablogs,messages,photosandvideoclips.Customerscanevenorganizeevents.TheserviceisalsolinkedtotheFacebookcommunity.


The operational performance challenge: streamlining the service creation environmentForCSPsinsaturatedmarkets,theproductandserviceportfolioisakeyareaforefficiencyimprovements.Forexample,discontinuingservices,handsetsorotherofferingsthatgeneratelittleusageandrevenuescanbethefirststeptowardshigherefficiency.Fortheremainingportfolioandeverynewservice,amechanismtoregularlytrackprofitabilityandcustomerrelevanceisneeded,withthelatterbasedoncustomerinsightandcustomercarereports.Organizationalandtechnological‘silos’oftenrepresentabarriertosucheffortsandhavetobeaddressedthroughprocessandsystemsrenewal.

Anotherareaforefficiencyimprovementsisstreamliningtheservicecreationenvironmentforshortertimetomarketandamoredynamicportfolio.

AwesternEuropeanCSP’smobiledataARPUincreasedby20%forprepaidand10%forpostpaidafterimplementingadevicemanagementsolution.AnotherEuropeanCSPisgainingnewup-sellingopportunitiesbyhavingnewservicesauthorizedquicklyandeasilywithacustomerpremisesequipmentmanagementsolution.Aftertheinitialinstallation,customerscanordernewservicesstraightfromthewebportal,whichisanexcellentlow-costmechanismforopeningupnewrevenuestreams.

ThaiCSP,AIS,hascreatedahighlyrobustandstreamlinedservicecreationenvironmentthatcutstimetomarket,givesmorebusinessandserviceoptionstoplaywithandprovidesimportantdifferentiatorsinanincreasinglycrowdedmarketplace.Itdidthisbydeployingasubscriberdatamanagementsolutionandcentralizingreal-timecustomerintelligenceandmultipleapplications.


Networkandservicequality

The basics are more decisive than ever: balancing quality and costsThekeyaimforCSPsistoensurethatcustomershaveagoodqualityexperience,butthismustnotbeattheexpenseofprofitability.Oneproblemisthatcustomersdonotreportgoodservicequalityandonlyfeelstronglywhentheyaredissatisfied–andcanquicklyspreadnegativeviewsaroundtheInternetandtocolleaguesandfriends.Theywillalsobombardcustomersupportlinesifthereispoorcommunicationaboutfaults.Leadershipinnetworkandservicequalityhasproventobeanexcellentgo-to-marketstrategy,attractingnewcustomerstoanetwork,asT-MobilehasdemonstratedwithitsWeb’n’Walkmobilebroadbandoffering.Butitisimportanttonotethatwhilequalityisoftendefinedasthe‘classic’factors–suchasnetworkavailabilityandperformance–acustomer’sexperiencecanalsoincludeotherissuesrelatedtoservicequality,roaming,contentdesign,applicationusability,devicesandsecurity.

T-Mobile’sWeb’n’Walkhasincreasedmobilebroadbandrevenuesby42%withahighqualitycustomerexperience.Amongthehighlightsare:• Highestqualitymobilenetworkin Germany,9yearsinarow,verified byConnectmagazine•Convenientandpersonalizedone- touchaccesstoarangeofWeb2.0 partnerservicescombinedwitha broadandattractivedevice portfolio,tailoredtomobileInternet usage• Excellentresults(asofyearend 2007)–90%customersatisfaction; highratingsinvalueformoney; and2millioncustomersacross Europe,with40%ofWeb’n’Walk customersnewtoT-Mobile

DoIhaveserviceavailabilitywhereIneedit?Istheserviceprovidedwithgoodquality?Istheserviceeasytouse?Ismyfixedbroadbandservicesecureandfastenough?5


TherearethreeareasthatneedspecificattentionfromCSPs.

Voice and messaging quality has direct revenue impactPoorvoicequalitylowerstalktimesignificantly–butpremiumqualityenhancestalktimeandcustomerloyalty.Anoteworthystudyonmobilequality,In-Touch,wascarriedoutonnetworksinGermanyin2008anddemonstratedthelinkbetweenpoorqualityandshortercalls,althoughthesensitivityofhandsetsisalsoafactorforvoicequality.Thestudyfoundaveragedifferencesofsometwominutesbetweenpoorandgoodqualitycalls–acleargapinexperience,andpotentiallyinrevenues.6

Further,mostmobilecallsinmaturemarketsaremadeindoorsanditiscriticaltoaddresscoverageandqualitywhilepeopleareinbuildings.OneSouthEuropeanCSPfound,afterconductingresearchamongbusinesscustomers,thatcontrarytoexpectations,droppedcallsandqualitywhenpeopleweredrivingwerenotasimportantasitthought–callsmadeindoorsweremorecrucialtothesehighvaluecustomers.Suchcustomerinsightcanhavemajorimplicationsfornetworkplanningandoptimizationdecisions.

SmartinthePhilippinesachieved22%improvementindroppedcallratesand15%reductioninhandoverusingoptimizationservicesandsolutions.

CustomersalsoexpectacertainlevelofqualitywhenusingmessagingsystemssuchasMMS.ItisnotunusualforanMMSofferingtonottakeoffasexpectedandforstandardmarketresearchnottorevealcustomerdissatisfactionwiththeservice.Closerinspectionofservicequalitycanuncoverrootcauses.

TelefónicaO2raisedMMSperformanceintheCzechRepublic,afteridentifyingandresolvingtherootcausesofcustomerdissatisfactionwiththeoffering.Benefitsincluded:49%improvementinthemobileoriginatedsendfailureratioand93%improvementintheretrievalfailureratio;bettercustomerexperiencethroughimprovedsupportofolderdevices;andimprovedinsightoncustomerserviceuse.ThisenabledthecompanytodefineaMMSdevelopmentroadmap.

5KeycustomerissuesrevealedbyNokiaSiemensNetworksandGartnerresearch6Connect,In-Touchstudy,2008


Broadband service quality Speed,thestabilityoftheconnectionandcoveragearethemajorqualitydriversforbroadbandservices.AsbroadbandInternet–bothfixedandmobile–isthekeygrowthsegmentinthecommunicationsmarket,attentiontoquality,asonekeyelementof thecustomer’sexperience,iscriticaltomaximizingopportunitiesandmovingawayfromcompetingonlyonprice.

Clearly,fixedbroadbandqualityandenhancingspeedstocopewiththeexpectedriseinInternetvideotrafficisessentialtogrowingandretainingmarketshareinthehomemarket,whichaccountsforthebulkofbroadbandspend.Poorbroadbandspeedsandserviceoutagesareruthlesslyexposedonmanywebsitesandbulletinboards,especiallyinmarketssuchastheUK,whichhasmanycompetingCSPsandISPs.Itisnotunusualforcapacitytorunoutinsomeareas,withcustomerswaitingmonthsforinfrastructureupgrades,whilemanyCSPsnowapplycapsondownloadingatpeaktimes.

Today’sfixedbroadbandtechnologiescanprovidethespeedthatcustomerswant.WhileADSLprovidesanentryintobroadband,thedemandsofagenerationusedtoHDTVwillinfutureneedtobemetbyVDSLandfiber-basedtechnologies.

Providershavethreeoptionstogetfiber-basedservicestotheconsumer:FTTC,FTTBandFTTH(FiberToTheCurb,BuildingandHome).BothFTTCandFTTBcanuseVDSL2technologyforthefinalconnection,achievingspeedsupto50Mbits/sand100Mbits/srespectively.FTTHbringsfiberrightintothehometoconnectthecustomerdirectly.NokiaSiemensNetworksbelievesthatratesofupto50Mbits/swillbeenoughtosatisfyconsumerdemandinmostmarketsforthenextfewyears,7soFTTCandFTTBcoupledwithVDSL2willbethemostcost-effectivesolutionforproviders.

Mobilebroadbandhasstartedtotakeoff,butthereisstilleffortneededtosatisfycustomersintermsofspeedandresponsivenessofthenetwork–especiallywhenservicesareusedinbuildings.8Asasolution,thelatestHSPA(High-SpeedPacketAccess)technologyimprovesthecustomerexperiencebyincreasingtheresponsivenessofthenetwork–thelatency–whichisasimportantastheactualpeakrateformanyapplicationssuchasvideo,fastemailsynchronization,real-timegamingandVoIP.AsanaturalevolutionofHSPA,LTE(Long-TermEvolution)networkswilltransformthecustomerexperience,takingmobilebroadbandservicestoanewlevelwherebrowsing,email,videosharing,musicdownloadsandmanymoreapplicationswillbeimmediatelyavailablewithoutanynoticeabledelay.

HighspeedaccesstopremiumservicesandtheInternethelptoenrichcustomerexperienceandcreatesustainablecompetitiveadvantagesfortheprovider.ButthisisastrategyfollowedbymostCSPs,andthereareanumberofotheroptionsfordifferentiationfromthecompetition,bymakinglifemoresimpleforcustomers.9

These options include:

• Removingtherestrictionsonbatterylifeand providingalways-onconnectivity• Improvinghomecoverageusingfemtocells• Coveringblindspotsandremoteareaswherethe useoffixednetworksiseconomicallynotfeasible• Makingefficientuseofmultipleaccess technologiestoallowseamlessmobility.


The operational performance challenge: optimizing and assuring end-to-end qualityCustomer experience also depends on the performance of the entire service delivery chain. Driven by the rise of broadband Internet and affordable computing, a growing number of services are delivered over the Internet and by groups of players in diverse value networks. This calls for increased flexibility in the CSP’s organization and processes, knowledge and competences, network assets and support systems. It also demands an assessment of the strategy for the service optimization and assurance processes – the ability to reconfigure operations in changing environments will be a key asset for a CSP. In particular, incumbent CSPs have often built businesses and infrastructures by gradually adding technologies, systems, applications and services, resulting in many operational silos. It is very important to optimize the service delivery chain to use existing resources in the most efficient way, enabling the right features and tuning the network and services correct ly to match business growth.

There are several issues concerning service assurance processes, including:

• Numerous monitoring tools and systems are used in service and network operations centers and most technologies or vendor systems are managed in their own silos. Staff are overloaded by the amount of data from managed networks and equipment, and have no dedicated resources and ownership for end-to-end quality, resulting in a lack of visibility of service quality. At the same time, many customers report the same or similar problems many times, as the root causes are not eradicated• Increasing service and device complexity drives up the number of customer care calls. As the service delivery vehicle grows in complexity, solving customer complaints becomes more difficult and time consuming, and repair time often breaks service level agreements or fails to meet customer expectations.

Solving these challenges requires a transformation from reactive to proactive service optimization and assurance, and a shift from network-centric to customer-centric operations.

This change requires a reassessment and redesign of current processes and support systems. As no company can renew all processes at once, there is a need to prioritize – this can be done according to market characteristics:

• CSPs in entry markets, for example, aim to build population coverage and capacity, basic services and operations as quickly and cost-efficiently as possible. The operational focus is on optimizing implementation and deployment processes, while also setting up basic sales, marketing and customer service functions. The implementation process for the access domain is especially critical, as it tends to take the major share of OPEX • In saturated markets CSPs need to offset declining voice revenues and increase market share through advanced services with superior customer experience while developing strategies to deal with ‘disruptive’ competitors and managing new business models cost efficiently.

Service usability and security are other important considerations. Ease of use is influenced by content design and packaging, the number of clicks needed to access content, and navigation logic. The trend towards IP-connected mobile phones and converging technologies means that customers are increasingly exposed to risks known from the IT world. Watertight protection against security threats, such as virus attacks, spam and hacking, is a necessity for a CSP, and not only improves customer experience but also manages the risk of revenue loss and fraud.

After using a service assurance solution, Orange Slovensko improved customer experience through implementing proactive maintenance, providing the right level of service quality and more efficient customer care, and applying marketing based on customer insights. The company also achieved: CAPEX optimization through network dimensioning based on customer usage; OPEX reduction through cost-efficient end-to-end network monitoring in operations and engineering; reduction of time to identify and solve customer care problems; streamlining of processes; and efficient sharing of customer data.

7 Nokia Siemens Networks, Broadband study, 20088 Nokia Siemens Networks, Broadband study, 20089

Nokia Siemens Networks, Whitepaper “Broadband with no boundaries”, 2008


Personalisation and transparency are keyThecostsandbillingmethodsofbothfixedandmobileserviceshavebeenthesourceofmuchfrustrationforconsumers,whoareoftenfacedwithverycomplexplansandtariffstructures,especiallyformobilecontracts.Forbusinesscustomers,thereareopportunitiestohelpconsolidatelinesandservices,astherecanbesubstantialwasteinunusedcapacityandoutdatedcontracts.SimplifyingcostandbillingstructurescangiveCSPsacompetitiveedgeincustomerexperienceasthisisakeyareawheresuppliersareconstantlycompared,bothbycustomersandbyonlineservicesandmagazines,whilebusinesses,morethanever,willbelookingtocutcostsanddemonstratereturnoninvestment.

ThechallengeforCSPsisnottogetsuckedintoa‘pricewar’onsimplifiedplans,especiallynowthatflatratepricingplansarebecomingcommonplaceinboththefixedandmobileworlds.Addingvaluebyofferingattractive,personalizedservices–butstillkeepingthingssimple–willhelpminimizechurnas,eveninadownturn,thepurepricelevelisoftennottheprimarymotivatingfactorforbuyers.Keyapproachesincludethefollowing.

Iwantpricingplansthatarerelevant,simpleandtransparent.IwantonlinevisibilityonhowmuchIhavespent.Billsmustbeaccurateandeasytounderstand.10

Costandbilling

10KeycustomerissuesrevealedbyNokiaSiemensNetworksandGartnerresearch

Personalized offers – overcoming the one fits all flat rate trapAdaptingservicestotheindividualpricingandchargingneedsofthecustomerwillbemoreandmoreimportantforfuturebusinesssuccess.

Infixedbroadband,the‘firstwave’ofservicebundlingisnowestablished:voiceplusInternetaccessplusTV.Butahighvolumeofbundlesalsomeansahighnumberofcustomersonflatratedeals.ThechallengeforCSPsistoofferchoicesofchargeableitemsforawidetargetaudienceontopofthesestatic,all-inclusive,flatratebundles.

AsuccessstoryisIliad,theFrenchtriple-playprovider,whichissuccessfullypackagingIPTVchannelsandvideoondemanditemsontopofabasicrateof€29.99.Some80%ofitscustomersaccesspayTVservices,whichwerethemostimportantgrowthdriverofmonthlyARPUfrom€29.99in2004to€36.30in2007.

Meanwhile,HongKong’sincumbent,PCCW,chargesforitsNOWTVserviceonaflexibleàlacartebasis:customerscanchoosesinglechannelstheywouldliketosubscribetoandpayperchannel.Inaddition,PCCWisofferingmini-packsthatincludeanumberofpremiumchannels.Thecustomers’perceptionisthattheyonlypayforwhattheyareactuallyusing.Tobeevenmoreflexible,customerscanoptformonthly,bi-annualorannualsubscriptionswithmini-packsorchannels.

Inthemobilemarket,manycustomershaveapostpaidcontractandmobilephoneforbusinessusage,andasecondhandsetwithaprepaidcardforprivatecommunication.Isitreallynecessarytohavetwomobilephones,onepostpaidandoneprepaid–maybeevenfromtwodifferentCSPs?Isitessentialtobeadedicatedpostpaidorprepaidcustomertousedataorvoiceservices,ortouseafixedlinephoneoramobile?ItisimportantforCSPstofocusonmeetingtheindividualneedsoftheircustomerstogenerateincrementalrevenuesbyobtainingalargerportionoftheirspend.


Insteadofapproachingthemarketwith‘siloed’productsthatdonotrecognizethatonecustomermayhavemanycommunicationneeds,CSPsshould,forexample,offervalue-addeddataandmultimediaservicesandWeb2.0communityserviceswiththepaymentmethodpreferredbythecustomer.OrCSPscantailorsingleservicesorcompleteservicebundlestotheindividualneedsofdedicatedusagegroups.Themoresaturatedthemarketbecomes,themorechoiceswillbeavailablefromthedifferentCSPs,andthemorethecustomerwillmakeuseofthischoice.

Buttobeflexible,CSPsneedtohavebusinesssystemsthatcansupportthisincreasingproductcomplexity–outdatedsystemscanbeamajorstumblingblocktoproductinnovation.Marketingteamsneedflexibletoolstoenabletheireffortstocreatenewbusinessandtodefendtheexistingcustomerbase.ManyCSPsworldwidearecurrentlydevelopingtheirownpostpaid-prepaidconvergencestrategysothattheycanbeclearlyaheadofcompetitorsthatarehamperedbytheirtraditionallegacyenvironment.

Aflexibleandcustomer-centricapproachmeansunifyingtheinfrastructureforpostpaidandprepaid,fordataandvoice,forfixedandmobileservices–inshort,movingtoaunifiedchargingandbillingsolution.CSPsdonotneedtodefinetheirserviceofferingtwice–onceforprepaidcustomersandagainforpostpaidcustomers.Overcomingtheboundariesbetweenpre-andpostpaidallowscustomerstodecidewhichservicetheywouldliketousewithwhichpaymentmethod.

Additionally,aCSPcansendofferstotargetsegmentsbyusingenhancedcustomercaredataandvalidpricingplans.Forexample,ifcustomershaveexceededtheirpersonallimitamessagecouldbeanoffertosubscribetoamoresuitabledatapackagewithasetmonthlyvolume–andcustomerscanimmediatelytakeuptheofferviacustomerself-care.Inthisway,customersareencouragedtocontinuetotrynewservices,knowingthattheirCSPwillofferappropriatenewpackagesiftheirusagepatternschange.

Anotherwayofpersonalizinganofferistoallowcustomerstotop-upwiththelittlemoneytheyhave,whichisveryusefulinemergingmarkets.Enablingmicro-prepaidtransactions,withtop-upvaluesoflessthan$1,attractslargenumbersofpotentialcustomersfromthelowerincomebands.Amicro-prepaidsolutionincreasestheaffordabilityoftheprepaidservice,boostinggrowthincustomernumbersandtheirmobilespend.

Transparency – reducing customers’ risk perceptionManycustomersinmaturemarketsarecautiousaboutthepotentialhighcostsofmobileinternetaccess.CSPscanattractthembymakingthecoststransparent,forexamplebyallowingthemtodefinetheirpersonalusagelimitondatatraffic.Thisgivescustomerscontroloftheirdataservicecostsandtheythenfeelsafetouseattractivenewservicesfreeofthefearofoverspendingtheirbudget.Tocontrolspending,fromtimetotimecustomerscheckusageonline,whichiseasilydonewithanInternet-enabledmobilehandset.Areal-timedisplayofusagealwaysprovidesaccurate,up-to-dateinformation.Customersthengetmorefamiliarwithusingthenewservicesandincreaseusage.Theycanthenbetargetedwithapersonalizedoffertosubscribetoamoresuitabledatapackage,asnotedintheprevioussection.

TheimportantpointfortheCSPisthatthecustomerrelationshiplastslonger.Thisreducestheriskthatcustomerswillswitchtoacompetitor.CustomersalsofeelwellservedbytheirCSPandarelikelytorecommendittofriendsandcolleagues.Lastbutnotleast,thistrustpositivelyinfluencesserviceusage–andrevenuefortheCSP.


ZAINKuwait,acustomerofNokiaSiemensNetworks,cannowacceleratethecharging-relatedpre-launchdevelopmentprocessforprepaidsolutions.Insteadoftakingweekstoadaptitssystemstosupporteachnewcustomeroffer,itcansimplyactivateoneofawiderangeofready-to-use,pre-programmedchargingoptions.Theseoptions,knownas‘marketingusecases’,enableZAINtoadaptchargingfunctionssuchastariffmodelsandrateplansinaflexibleandtimelymannerwithoutcompromisingquality.Thismeansthatnewmarketingcampaignssuchaspromotionalminutesorlifetimebonusplanscanberolledoutfaster,andcanbeappliedtoallmajorservicetypesfromvoiceandSMStoemail,instantmessaging,Internetaccessandmusicandvideodownloads.

ThisexampleshowshowCSPscanbenefitfromofferingtheircustomersfullcontrolovertheircreditandspendinglimitsregardlessofwhetherthecustomerisprepaidorpostpaid.Real-timeaccountmanagementandreal-timepriceplanupgradesviacustomerself-carearenormallyseenasprepaidfeatures–nowthesefeaturesareavailableforallcustomersandforallservices.

Also,emergingmarketshaveahugepotentialconsumerbaseforwhichtransparencyisanissue.Theseverylow-incomecustomersneedaccesstocommunicationsbutfindthecostofgettingconnectedistoohigh.Typically,$3-5adayadayisthemaximumbuyingpowerforcustomersinemergingmarkets.Phonesharingiscommonandmostoftentakesplaceinatrustedenvironmentsuchasafamilyoragroupoffriends.Sharingthephonewithanybodyelsemightruntheriskofoverspending–butwithcost-tracking,customerscanlimitthecostofaprepaidcalltoanydesiredvalue.

Andpeopleonlowincomesinanymarketoftencarefullyplantheirspendingtodiminishthefearofexceedingtheirbudget,butstudieshaveshownthatspendingislikelytoincreasewhentheyareawareoftheremainingaccountbalance.Prepaidbalanceandexpirydetails,includingthecostofthelastevent,callorSMS,aswellastheamountofthelastprepaidrecharge,diminishcustomers’fearsofexceedingtheirbudgetsandincreaserevenues.

Finally – the charging challengeAstate-of-the-artchargingsolutionhasamajorroletoplay.Nomatterhowgoodnewservicesandapplicationsare,marketingcampaignsalonearenotenoughtoturnthemintorevenue-generatingcustomeroffers.Todothat,afast,flexibleandaccuratemechanismfortrackingusageandcalculatingpaymentsisneeded.Intraditionalnetworkoperationssystems,thechargingfunctionisamongthelastandmostcomplexofmanyelementstobeaddressedintheoveralldevelopmentprocess.Inmostinstancesitinvolveswritingandtestingcase-specificcodeforthechargingsoftware,whichcanoftenleadtosignificantdelaysinbringinganewserviceorpricingpackagetomarket.

Inprepaidmobilemarkets,thesedelayscouldmakethedifferencebetweenstayingaheadandfallingdangerouslybehind.


Customercare

11KeycustomerissuesrevealedbyNokiaSiemensNetworksandGartnerresearch

There’s no one size fits all – targeted care is the answerKeyareasforimprovementincustomercareprocesses include:

• Adaptingcustomercaretodifferenttarget segments,accordingtothecustomer’sindividual lifetimevalue• Efficiencyincustomercare,ensuringefficientand fastfaultandcomplainthandlingviaseamless informationflowthroughintegratedsystems infrastructure• Proactivecarewithend-to-endautomationof customercareprocesses.

Adapting customer care to the different customer needsServicelevelscanbeincreasedtomatchtherequirementsofhigh-valuesegmentsandadjustedinthecaseoflower-valuecustomersinordertoreducecosts,usingself-careoptions,forexample.Theneedsofcustomersfromlargecorporationsdifferfromthoseofconsumersorcustomersinsmallandmediumsizecompanies.Thechallengeistochoosethecombinationthatbestmatchestheserviceportfolioandproposition.

Solving complaints first time rightTheefficiencyimprovementactionsemployedbyCSPsinmultiplenetworkoperationscommonlyinclude:

• Supportingcustomercarefirsttierstaff(inthecall center)tosolveincidentsduringthefirstcustomer contactandsocutthenumberofcallsforwardedto thebackoffice• Shorteningthecustomerproblemresolutiontime byreducingthetimeneededtointerviewthe customeraswellasthetimeneededtoidentifyand solvetheproblem.

Additionally,manyCSPsusecallcenteragentstoanswermanycalls,suchasbalanceorbillrelatedquestions,whichdonotactuallyneedpersonalassistance.Migratingtheserequeststootherchannelssuchasweb-basedself-careisapossibility.

Conventionally,callcenterstafftalktothecustomertogaininformationabouttheproblem,aprocessthatcantakeseveralminutes.Thisinformationcanbeinaccurate,leadingtotheproblembeingforwardedtothebackoffice.Asanexample,lackofsubscriptioninformationavailabletoagentswhenacustomermakesafirstcallcanresultinthousandsofenquiriestothebackofficetocheckonthecustomer’sprofile.

Infact,thetotaltimetoresolveacustomerproblemcanextendtoseveralhoursoveranumberofstages.Thesestagesinclude:identifyingtheproblemareaduringthefirstcustomerinterviewandcollectingtherequiredinformation,whichcantakeseveralminutes;trouble-ticketcreation;caseforwarding/caseresolution;andinformingthecustomer.

Further,customersincreasinglyneedmoresophisticatedtechnicalsupportforadvancedservicesandmorecomplexdevices.Callcentercapabilitiesneedtobeupgradedaheadofthecommerciallaunchofnewservices,givingpersonnelabetterchancetosolveanyproblemsduringthefirstcallandsoshortentheresolutiontime.

Myproblemsmustbe solvedfirsttime.Iwantdifferentservice optionsmatchedtomyneeds.Iwantproactivesupport.AssoonasIsubscribetoaserviceIwanttobeableto useit.11


Byintroducingacustomercaresupportsolution,thenetworkmanagementandcustomercaremanagementteamsofElisaFinlandbroughtmeasurablebenefitstotheirfinancial,marketing,productmanagementandhumanresourcescolleaguesby:

• Servingthesamenumberof customerswith20%lessstaff.• Solving98%ofcustomercalls atthefirststage•Decreasingfieldmaintenance visitsby15%• Improvingcustomer satisfactionbyshorteningthe resolutiontimeandmaking proactivecustomercontacts• Creatingbetteraligned customeroperationswiththe brandpromiseofservice leadership• Improvingtheproductdesign processbyaddressing feedbackonproduct performance• Increasingemployee motivationincallcenters

Additionally,enterprisecustomersoftenhavedozensorevenhundredsofdevicestomanageandacompanythatcantaketheworkofftheirshouldershasaformulaforsuccess.SomeCSPswanttograspthismarketopportunityandincreaserevenuebyprovidingadvanceddevicemanagementservicesthatcanbeaccessedremotely.ThisallowstheCSPtobecomeacredibleICTpartnerforthebusinesscustomer,withtheCSP’sdevicemanagementservicedecreasingtheenterprise’sITworkloadandneedforcertainITresources.ThepressureonenterprisestodecreaseOPEXbyoffloadingtheextraworkneededtomanagetheirdeviceswillcreatemoredemandforthissortofservice.

Self-care optionsSomecustomerspreferself-careoptionsthatgivethempersonalcontrolovercosts,theservicestheysubscribeto,andtheirdevices.Theywanttocheckaccountbalances,rechargeaccountsandselectchargingandserviceoptionsfromadeviceorwebportalorthroughaninteractivevoiceresponsesystem.Thereisincreasingdemandforcustomerstobegivendirectaccesstopaymentandserviceinformation,aswellastheabilitytotakecontrolwhenandwheretheywant.

Automating configurationTheriseindevicecomplexity–withmoreapplicationsandconfigurationoptionsandwithcustomerschangingtheirdevicesmoreoftenandusingpurchasingchannelsoutsidetheCSP’scontrol–isplacingyetmoreworkloadoncallcenters.Afullyautomateddevicemanagementsystemcutstheneedforcallcenterresourcesrequiredtohelpcustomerssolveincorrectdevicesettingsmanually.Automatedprocessesimproveservicequality,asprocessexecutionisfast,consistentandcorrecteverytime.

Withautomation,customersalsofeelmorecaredfor,whileservicequalityandoperationalefficiencyaresignificantlyimproved.Automaticconfigurationandprovisioningofdevicesandservicescanbeperformedforbothnewandoldcustomers,ascantheautomaticcorrectionoferrorssuchaswrongGPRSsettings.Auto-correctionalsoallowstheCSPtosendnewsettingsatwill.

TheCSPcanalsoautomaticallyproposenewserviceoptionsbasedoncustomerbehavior,whileend-to-endautomationallowssubscriptionstobeoptimizedcost-effectively.

AnAsianCSPreducedcustomercarecallsby20%usingadevicemanagementsolutionthatpaidforitselfwithin3months.


Thispaperhasidentified:

• ThegrowingimperativeforallCSPstobecome customercentricandmanagethecustomer’s experiencetoincreaseprofitabilityanddrivehigher operationalperformance• Thekeyfactorsthatdefineexperiencefor customersofCSPs–serviceanddeviceportfolio, networkandservicequality,costandbilling,and customercare–andhowtogethertheydrivethe overallbrandvalue.

Detailedcustomerinsightisneededtouncoverexactlywhatelementsinthesekeyareasareunderperforming.Crucially,todothisrequiresaCSPtoexamineboththeobjectiveandthesubjectiveexperiencesofcustomersthemselvesinalltheirtouchpointswiththeprovider.Atrulycustomer-centricCSPwillliberateitscustomerinformationfromdatasilosandbringittogetherintoaholisticcustomerview,whereitcanbeefficientlyaccessedbyallsystemsandeveryoneintheorganization.Basedonthisholisticviewofcustomerinsights,CSPscanthenoptimizethelowperformingexperienceareas,backedbyreturnofinvestmentanalysis.

StreamlinedOSSandBSShaveacrucialroleinthisprocess.OSSandBSSareconvergingasCSPsrecognizethatitisimpossibletomanagecustomerexperiencewithouteliminatingthegapbetweenmanagingandreportingunderlyingnetworkperformanceandusage,andtheimpactonbusinesssystemsthatmanagecustomerrelationships.Solutionsandexpertiseareneededthatstreamlinetheinterfacebetweennetworksandbusinesssupport,unifyingtelcoandITsystems.

AnotherkeyelementofthecustomerexperiencejigsawisasubscriberdatamanagementsolutionthatallowsaCSPtogainaholisticviewofacustomerfromtheperspectiveofdifferentpartsoftheorganization.Realtimeandhistoricdataoftensitsindifferentnetworkandservicesystems,andvariouscompanydepartmentsmayownsomeslicesofthedatabutfindithardtogainanoverallpictureofcustomerpatternsandtouchpointsthatcouldhelpprovideabetterserviceorbuildbettermarketpropositionsandproducts. Thegoodnewsisthatthebuildingblockstoimplementthesesystemsareavailable,asisthewillingnessofmanyCSPstobecomemorecustomercentric.

Conclusions:puttingthecustomer attheheartofthebusiness

NokiaSiemensNetworkscanhelpCSPstoensurecustomerexperienceissuccessfullyoptimizedinthefivekeyexperienceareaswith:•Marketleadingsubscriber datamanagement,service managementandcharging andbillingsoftwareassetsto helpCSPstobasetheir decisions on customer insightsandensuresuperior customercareiscombined withsimplifiedandfair charging• Strongnetworkandservice fulfillment,assuranceand optimizationsolutionstohelp CSPstobuildanattractive andeasytouseportfolioand todeliverthebestquality experience

NokiaSiemensNetworkstakesresponsibilityfortheend-to-endservicedelivery,frombusinessconsultingtointegrationandsolutiondeployment,totechnicalsupportandcareservices,providingCSPswithglobalreachandlocalpresenceworldwide.

http://www.nokiasiemensnetworks.com

Copyright©2009NokiaSiemensNetworks. Allrightsreserved.

Thispublicationisissuedtoprovideinformationonlyandis nottoformpartofanyordercontract.Theproductsandservicesdescribedhereinaresubjecttoavailabilityandchangewithoutnotice.

Code:B301-00380-RE-200902-1-EN–2/2009Activeark.Ltd

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