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In today’s mobile marketplace, attrition is the main enemy of customer lifetime value. Roughly 75% of the 17 million to 20 million subscribers who sign up with a new wireless carrier every year come from another service provider. They’re already churners. When a customer leaves, the mobile operator loses its investment in acquisition and the current and future revenue from this customer.
Many marketers continuously struggle optimizing the investment balance between acquisition and retention to grow their base. For most, ensuring the retention and loyalty of high value customers, or those with high value potential, is job No. 1.
Forget big data – think micro data
Like many companies, mobile operators have been swept up in the hype over “big data.” Maybe it’s time to re-think that idea and come to terms with the fact that big data alone has not been enough.
For the answers to reducing churn and enhancing lifetime value, mobile operators need precise, real-time insights – “micro data.” Furthermore, to be of value to the enterprise, these purpose-driven insights must be tailored to the individual user or department, be it finance, engineering, marketing, sales, operations, network management or at the C-level.
A micro data approach uses advanced predictive analytics to replace hunches with facts. Mobile operators can quickly find answers to the most important questions on customer churn and loyalty, and know there is likely not just one answer, but a series of answers beyond what any human can identify alone.
Typical granular questions that mobile operators need answers to:
–Which customers are actually profitable and why?
–Which customers have high profit potential and how can we get them there?
–What are the hidden drivers that drain profitability?
–What is the optimal layering of services to drive revenue for top customers?
–What are next best product offers that will elongate a customer’s tenure?
–How much should be spent to save a customer – at the customer level?
–What is the likelihood of a customer buying a particular product or service?
–What are the various trends in network usage by application and customer type, and what will that mean for future churn or upselling?
–Which customers will be most sensitive to a product or network migration?
Getting high-value customers to “stick”
The micro data approach lets mobile operators identify proactive indicators that lead to churn, and leverage advanced statistical models to determine the likelihood of customer dissatisfaction.
These important insights become the basis of treatments targeted at the subscriber level and configured with the operator’s contact center. Service representatives on the front lines can present “sticky” offers based on the customer’s known needs and interests, and thus are more likely to halt churn, increase satisfaction and boost loyalty and lifetime value.
Just as importantly, insights gained from micro data empower the mobile provider to look ahead, planning for future product development based of customers in each segment cluster during every life-cycle phase. This forward-looking product strategy helps ensure targeted investment in products that keep high-value customers on-board and buying more.
Using a micro data approach can provide a significant advantage in keeping the customers you want most.
