Subscribers who stay loyal for longer are more valuable, adding directly to the bottom line. Lower churn, more revenue and greater operational efficiency are the prizes for creating the optimum customer experience.
But beware, the key word here is ‘optimum’ because providing superior customer experience should never be a goal at any cost. “There are many companies worldwide who have excellent customer satisfaction scores, yet suffer negative business figures,” comments Jari Eskola, Head of Sales Development for Service Management, Nokia Siemens Networks.
Avoiding the trap means managing the customer experience with an unrelenting focus on profitability.
The key focal points
The greatest return on investment will be achieved by attending to those drivers (see text panel: Tips to improve customer satisfaction) that carry the highest importance for the customer, but which the service provider is managing least well.
Eskola points to two key areas to solve the conundrum: business processes and the call center. “Better processes help to ensure end-users get new services quickly and reliably. Automated systems can provision a DSL line on the same day as the customer order, not weeks later. They can automatically provision mobile devices for new services or when the end-user changes handset,” he says.
“Secondly, it’s crucial for the customer call center to be effective. This is the main point of contact for end-users and the more that front line staff can resolve customer queries during the first call, the better. It’s critical for raising the service provider’s image.”
Achieving worthwhile returns
However, while business and top tier customers may pay for good quality customer care, providing high quality customer service for lower tier customers, who are inherently less loyal, is more challenging. Instead, automation and self-administration are more likely to achieve a better return on investment.
Customers are a service provider’s most important asset, and customer life-time value (CLTV) measures their worth. CLTV is the discounted cash flow of the average revenue per customer less the costs generated by that customer. In basic terms, it is what the service provider can expect to earn from the customer over the lifetime of the subscription.
Improving the performance of the drivers that influence customer loyalty has a direct impact on CLTV. It’s paramount to achieving stronger and more profitable customer relationships.
Tips to improve customer satisfaction
There are four critical areas that carry the greatest impact on the customer experience. Achieving a good return on investment demands a focus on those areas that are underperforming and which are the most important to specific customer segments.
Cost and billing
Invest in flexible charging and billing systems to achieve differentiation. Ensure billing transparency and accuracy to build trust and protect against revenue leakage.
Network performance and service quality
Transform service quality by focusing on devices, instant service consumption, security, application usability and value for money.
Customer service
Ensure that after-sales service is easy to contact and quick to respond. Focus investments on a combination of enhanced call center capability, device management automation and self-administration systems.
The service and device portfolio
Build a portfolio that encompasses innovative devices and services that are easy to find, purchase and use. Converge service bundles and give customers the ability to create their own packages of services and payment choices.
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