Twenty years of unbridled expansion have been followed by ten rather more difficult ones for the telecommunications industry.
The initial decades were spent putting mobile phones in people’s hands. Yet, more recently, market saturation leading to falling ARPU and increased customer churn has changed the industry’s focus.
Communications service providers (CSPs) need to prioritise customer retention, ARPU growth and cost reductions if they are to be competitive in the marketplace.
Yet despite the challenges, with a particular focus on the pre-paid subscribers, there is a route to growth for CSPs. The pre-paid market alone is forecasted to be worth $3trn by 2022. It’s time to move on from merely selling packages to tracking and understanding your customers’ needs and creating a compelling customer experience.
Here are five ideas to consider if you want to reduce customer churn and grow ARPU.
- Wake up existing customers
Reactivating dormant customers by offering them a tailored airtime advance for a small fee will reduce the risk of counting them in your next churn rate calculation.
- Understanding your customers’ needs
Analysis has shown that 87% of attempted purchases through a popular mobile app store fail due to insufficient funds in their account. But if you as a CSP know your customer, you may be able to provide them with a small advance on the funds they need to make that purchase. This will be particularly appreciated by users who don’t want to interrupt their gaming session to top up.
- Facilitating that important email or call
Your customers will tell you they run low on credit at the most inconvenient of moments. Research has shown 27% of zero or low balances occur after 8pm, when it may be difficult to top up because they are away from home. Offering them the airtime they need at the right moment will generate long-term loyalty.
- Removing the pinch point
Don’t make it hard for your customers to top up. 3.5% of pre-paid mobile customers go into low balance territory every day, so why make it hard for them to get out of it? Simply sending a text message if a customer runs out of credit during a call to allow them to increase their balance with a single character can remove the temptation to switch networks.
- Outsource quickly with the cloud
The above tips demonstrate how advancing the right amount for each customer when they approach a pinch point can help to build loyalty to your network and increase pre-paid ARPU.
Experian’s Dynamic Airtime Advance is a cloud-based solution that can be implemented within eight to 10 weeks.
It works. An EMEA CSP, for example, has found that churn is 52% lower for those subscribers using DAA, and ARPU is 111% higher than those who are not.
Find out more about how to improve your customers’ loyalty. Register now to attend Experian’s online event, Monetize your pre-paid customer base.