After decades of expansion, telecommunications subscription service providers face stiff competition and high levels of churn. What's a company to do? They need to understand how today's consumers shop for, interact with and engage support from their providers, to better prepare for tomorrow's imperatives.
To help telecommunications companies find a way forward, we surveyed more than 1,400 television, Internet and phone subscribers across the U.S., Canada and the UK. Our exploration uncovered some myths, solidified lasting expectations and identified key demands, including emerging "smart home" opportunities. According to our research, here are five things telecom providers need to understand:
Voice Support Still Rules
Customers overwhelmingly prefer a telephone call over other digital support channels for most service queries, especially in the U.S. and Canada. This preference extends even to the tech-savvy 18—34 years old demographic. Familiarizing and comparing products and services online is the exception to this, proving that customers like to be in control of their shopping experience at their own pace. But when it comes to reporting a specific problem or placing an order, these same customers prefer fast, personalized and real-time responses from a live person over self-help channels. Consequently, service providers should in no way abandon or even reduce their voice support prematurely. But they should look for ways to rethink and simplify their self-service support, especially since respondents sighted significant interest in it, provided it can be easier to use and faster, while keeping them in control. The good news is consumers contact their service providers rather infrequently; less than once a year on average, regardless of age, product category, or gender.
To reduce expensive support calls, service providers have two options: Use self-service online, chat support or provide mobile apps, which are an appealing secondary channel, especially to millennials. They must also log all customer interactions to better anticipate popular services and spikes in demand with predictive analytics.
The Young Are Unsatisfied, Fickle and Demanding
Just over half of the 18—34 year olds we surveyed said they are "very unsatisfied" with their providers and churn often as a result. To make matters worse and further erode already tight margins, this group contacts their providers more than older generations. But this same high-touch group leaves a significantly larger digital footprint , what we call "Code Halos,"1 which service providers can learn from to better understand millennial demand and refine the products this group uses to offset increased call volumes.
For instance, service providers can tap this data to understand which services (such as text, video downloads, or photo-sharing apps) they use most and proactively deliver hyper-personalized services that young customers expect from other industries and products, such as banking, retail and gaming
The Basics Matter
Amid low satisfaction and high levels of churn, it's important to note that the top influences on satisfaction include knowledgeable support reps, short wait times and timely installation and repairs, according to our research. (The bottom two influences were personalized Web site experiences and frequent solicitations for feedback.) Furthermore, fiber installations received the highest satisfaction rates and discounted or free services along with e-mailed apologies were seen as the most effective resolutions to service difficulties. Obviously, meeting such high customer expectations might require difficult, costly or risky changes, such as retraining staff or dramatic shifts in marketing and pricing. For this reason, getting the basics right requires significant commitment from senior management. It also requires "Code Halo" thinking to identify the root cause of what providers are doing well and where they're falling short. This data ranges from complaints on social media and handing time reports from CRM and help desk systems to the number of "truck rolls" required to solve various problems. Much of this data is already being gathered and analyzed, but it's often isolated in information silos rather than as an integrated whole.
The "Smart Home" Window of Opportunity
Half of the subscribers we spoke to expressed interest in connected or smart-home offerings and said it would increase their satisfaction with their current telecom provider. In fact, controlling utilities and monitoring home security generated the greatest level of interest, particularly among younger customers. Of those surveyed, however, less than half trust their current provider to deliver such services.
To combat this, providers must further educate customers about the value of smart-home offerings, as well as invest in technologies today to ultimately deliver a compelling "Internet of Things" ecosystem. For example, providers might consider a service that tracks a homeowner's location from a smartphone and turns on the air-conditioning just prior to arrival without wasting energy. Or a thermostat that checks current energy prices and temperature forecasts to order at the lowest price. Obviously, such ambitious products require significant investments, but the cost could be offset by selling appliance data about failing parts to manufacturers or repair providers or identifying homes in high-crime areas to upsell home security systems or homes with significant amounts of children's TV program to upsell relevant services to them.
The Social Media Myth
Conventional wisdom says younger customers turn first to their peers on Twitter and Facebook to form opinions about the products they buy or are in need of servicing. They don't, at least according to our survey. The majority turn to informational websites and online user reviews over social media before taking action. This could change if providers find creative ways to leverage social media. But as of now, television, supplier Web sites and family members are cited as the top sources for discovering provider promotions. That said, providers should not be discouraged by low use of social media to discuss and rate their performance. When paired with Code Halo thinking, they should consider it untapped, long-term opportunity to better understand future customers, deliver value-added services to them and beget brand loyalty.
That customers still prefer traditional voice support to digital self-service channels and value the basics of well-informed service reps and timely service over fancy digital offerings is not bad news. It is, instead, an opportunity to use the wealth of information flowing across their devices and networks to understand and serve customers better. Rather than try to move as many customers as quickly as possible to digital service channels, providers must consider which of their customers and services best fit the digital self-service model. To do this, as well as much of the above, Code Halos is the answer.
For more information, read the full white paper, Back to Basics For Communication Service Providers or visit our communications practice.