retention strategies for fixed operators

23
Retention Strategies For Fixed Operators Vs Mobile Counterparts Edward Emmanuel Tanzania Telecom

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Presented at 3rd Annual Customer Loyalty Event Johannesburg SA

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Page 1: Retention Strategies for Fixed Operators

Retention Strategies For Fixed

Operators

Vs Mobile Counterparts Edward Emmanuel

Tanzania Telecom

Page 2: Retention Strategies for Fixed Operators

Agenda

Global ICT Development

Key ICT Indicators for Africa

Challenges facing Fixed operators

Retention Strategies for fixed Operators

Conclusion

Page 3: Retention Strategies for Fixed Operators

World Trends

Page 4: Retention Strategies for Fixed Operators

Observation on Trends

In 2002, the number of Mobile Subscribers (1.17b)

surpassed for the first time the number of fixed lines

(1.09b) worldwide

In 2005 the number of Mobile Subscribers on every

continent exceeded the number of fixed lines in

service

In terms of growth, the number of Mobile

Subscribers almost Doubled (2.18b) while that of

fixed barely grew (1.23b) in 2005

Page 5: Retention Strategies for Fixed Operators

Africa: Subscribers (mil)

0

50

100

150

200

250

300

350

400

2005 2006 2007 2008 2009 2010

Mobile Broadband

Mobile Subs

Fixed Lines

Fixed Broadband

Internet Users

Source: ITU 2011.

Page 6: Retention Strategies for Fixed Operators

Africa: Penetration (100 inhts)

0

5

10

15

20

25

30

35

40

45

50

2005 2006 2007 2008 2009 2010

Fixed Lines

Mobile Subs

Mobile Broadband

Fixed Broadband

Internet Users

Source: ITU 2011.

Page 7: Retention Strategies for Fixed Operators

Observation

Africa is the fastest growing mobile market in the world (ITU)

A major reason for the boom is that Africa lags far behind other

continents when it comes to fixed-line phone subscribers

Africa lacks an investment-intensive infrastructure, e.g., fixed telephone

line and fixed broadband infrastructure

the large costs of stringing up telephone wires so far has not been

economically viable

The establishment of mobile phone networks has also defied structures

hostile to investments, warfare, failed states and natural disasters

Intense competition has pitted once powerful monopoly fixed Networks

against rapidly growing Mobile Networks

Page 8: Retention Strategies for Fixed Operators

Challenges Facing Fixed Network

Lack of investment-intensive infrastructure, e.g., fixed telephone line and fixed broadband infrastructure

High costs inputting up Fixed Network to address the raising

Demand

Liberalization of the Telecommunication markets v. Readiness of the Fixed Operators to compete

Decline of Fixed Telephony Revenues and subscribers

Business models, company culture, organizational structure

and identities of Fixed Operators

Thus Fixed line Sector remains the least dynamic sector – While

the number of fixed lines have been falling in Developed

counties, they are developing very slow in developing world (ITU)

Page 9: Retention Strategies for Fixed Operators

What Next For The Fixed

Operators?

Retention Strategies

Page 10: Retention Strategies for Fixed Operators

Manage Customer Process

Transforming the Business Models

Align the Strategic

Choices and

capabilities to the specific needs of the

customers

Greater Customer

Intimacy

Need based

Segmentation

Time to deliver

Identify Customer

Expectations

Measure Customer

Lifetime Value

Manage Customer

Information as strategic Asset

Align Strategy with Customer

Values and Expectations

Manage Customer

Experience

Integrate across the Business

Source: BMI Institute of Business Value

Page 11: Retention Strategies for Fixed Operators

Elements of Customer Life Cycle

• Growth • Retention

• Acquisition • Awareness

Identify Brand values for Different target segments to

inform Innovative Market & Product

campaign

Retails Shops, Websites, multichannel contact centers are critical customer Touch points that can provide differentiation

Network Features, innovative services and solutions intelligently priced and bundled are critical for Revenue stimulation and differentiation

Billing and Payment, customer

care, marketing and other

communication present

opportunities for improved customer

experience

Page 12: Retention Strategies for Fixed Operators

Positive Retention Strategies

1. Creating customer delight

2. Adding Customer perceived value

3. Creating Bonds

4. Building Customer Engagement

Page 13: Retention Strategies for Fixed Operators

1. Customer Delight

Meeting and exceeding customer expectations

Understand customers, and then acquire and deploy

resources to ensure their satisfaction and retention

Going beyond what would normally satisfy the

customer.

Being aware of what it usually takes to satisfy the

customer and what it might take to delight or

pleasantly surprise the customer.

Page 14: Retention Strategies for Fixed Operators

2. Customer-perceived value

Companies can explore ways to create additional

value for customers

The ideal is to add value for customers without

creating additional costs for the company

If costs are incurred then the value-adds may be

expected to recover those costs e.g

Loyalty schemes

Customer clubs

Sales promotions

Page 15: Retention Strategies for Fixed Operators

3. Bonding

Social bonds

positive interpersonal relationships between people on

both sides of the customer-supplier dyad

Structural bonds

when companies and customers commit resources to a

relationship.

these resources yield mutual benefits for the

participants

Resources committed to a relationship may or may not

be recoverable if the relationship breaks down

Page 16: Retention Strategies for Fixed Operators

4. Build customer engagement

Highly engaged customers have levels of emotional

or rational attachment or commitment to a brand,

experience or organization that are so strong that

they are highly resistant to competitive influence

Page 17: Retention Strategies for Fixed Operators

Making Use Of The Available Infrastructure

Page 18: Retention Strategies for Fixed Operators

Convergence

Fixed Mobile

Convergence

(FMC)

Telco Media

Convergence

(TMC)

• Seamless connectivity between fixed and

wireless telecommunications networks

• Provide services to users irrespective of location, access technology, and terminal.

• Build and offer multiple services out of, integrated or converged networks, fixed and mobile

• Wide coverage remains the viable & Cost effective option for deploying services

• Broadband technologies enable operators to broadcast or stream multimedia signals to their subscribers

• Engage in complex web of collaboration

with the media and entertainment, IT

• Partner to create value

Page 19: Retention Strategies for Fixed Operators

Triple Play/Quad play

Explosion in data service revenues

High demand of data

related services

Narrow Consumer Options

and search costs

Triple play: the provision of two bandwidth-

intensive services - high speed internet access

and television – with a less bandwidth-

intensive service, fixed line telephone.

Quadruple Play is a triple Play that adds

Wireless or Mobile telephony Services

Page 20: Retention Strategies for Fixed Operators

International Data Cables

Arrival of several international data cables

Rising demands for major

Bandwidths

Cross border connectivity

Backhaul connectivity is

crucial because it

enables transmission of

intra-regional and other international traffic

Page 21: Retention Strategies for Fixed Operators

Existing Service

Make use of all services available in the Fixed

Network

Corporate services and solutions such as data virtual

private networks (VPNs) and multi-protocol label switching

(MPLS)

Data products and services such as broadband and fixed-lines

Whole sale Business: providing guaranteed bandwidth to

businesses between major commercial centres

Page 22: Retention Strategies for Fixed Operators

Conclusion

Fixed-line telecommunication Opportunity as backbone providers (fiber optic

network, for the Internet, and fixed lines still provide the fastest data speeds by

far)

Growing customer demand for higher bandwidths and the time to deliver

Customers do not care what technology is used to transmit their data or how

the Functions they use are supported. Their primary concern is service that

addresses their needs

Success will depend on each players ability to combine its own differentiating

strengths (such as Customer Management, network assets and service

creation with the capabilities of partners to create seamless communication

services that meet the needs of targeted customer segments - IBM

Page 23: Retention Strategies for Fixed Operators

END OF PRESENTATION

Thank you