With an eye toward improving customer experience and engagement it has been part and parcel of the digital transformation taking place in mobile networks around the world. It’s all being driven by increased competition – especially from over-the-top (OTT) players – and massive investments for network rollouts meaning that mobile network operators (MNOs) are feeling the pressure to boost revenue per user (ARPU), while also reducing churn.
At a time when the global economy has been weakened and strained, Covid-19 has forced MNOs to scale up to meet the unprecedented demand for connectivity. Moreover, the pandemic has forced MNOs to close physical stores and reduce call-centre capacity.
With their sales channels severely disrupted, MNOs say in-store sales are down 90%, and many believe physical commerce will not return to previous levels when the pandemic is over. Yet prior to the pandemic, many MNOs – especially those in emerging markets – were heavily relying on physical stores and call centres to both sign up new customers and upsell packages and services to existing subscribers.
It’s long been known that this approach is both expensive for MNOs and time-consuming for customers; however, the pandemic has forced operators to reprioritize their digital transformation goals, with an eye toward answering questions like:
• Where are we with digital outreach?
• Do we have the technical infrastructure to precisely target and convert customers using digital channels?
• Do we have the in-house skills to create strong digital campaigns?
• How can we implement a digital campaign when we have such tight budget constraints?
The tools to make it possible for MNOs to sell online are readily available. They support targeting and converting prepaid users to post-paid accounts using a variety of digital channels, eliminating the need for store visits or call centre conversations. Yet many operators still depend heavily on physical stores and call centres to manage most processes – including post-paid sales and prepaid upgrades.
While the human touch has some advantages, the truth is that digital sales help customers complete faster. In fact, there are five key ways that MNOs can use digital sales to boost revenue:
• Give consumers what they want – Reports and industry analysts alike say customers prefer to help themselves. According to Forrester, “Customers increasingly leverage self-service and agent-assisted digital communication channels for customer service, as these channels have the least amount of friction.”
• Deploy an array of digital channels – Websites, apps and SMS push can be used to target new customers and upsell existing subscribers. But there are less obvious options – for instance, the balance check menu, where prepaid customers are directed to assess their credit – that can be used to upsell customers to post-paid contracts.
• Create proactive and customized campaigns – Call centres and physical stores traditionally rely on customers to make the first move. But in a digital environment, MNOs can precisely target individual customers with personalized offers.
• Continually analyse and improve your digital journey – The digital journey is easier to monitor than in stores or call centres. MNOs can scrutinize performance analytics and run tests to assess copywriting, form layout, button placement and more.
• Apply digital selling across the entire portfolio – MNOs can sell a plethora of offerings via digital channels, including post-paid contracts, prepaid to post-paid upgrades, mobile money products such as micro-loans and other digital products and services.
If digital is so effective, why aren’t more operators using it?
Building 3G, 4G and now 5G networks are some of the most expensive technology upgrades that operators have ever faced, depleting almost all of their Capex budgets for the foreseeable future. Meanwhile there’s no question that it can be costly to build a digital strategy that embraces all channels and links back to existing customer relationship management (CRM) systems.
With so many other investment priorities, the digital sales process is often overlooked. Moreover, there’s a skills gap, and it’s expensive to recruit and train digital sales personnel.
But MNOs have a tremendous opportunity to overcome those barriers to entry by partnering with a company that specializes in building digital systems. Such partners should have solutions that enable MNOs to migrate to digital sales quickly – in weeks vs. months. Such solutions shouldn’t require operators to pay set-up or running costs. Instead, operators should partner with a company that provides a revenue-share model on completed conversions with a lower cost to acquire than traditional channels.
By embracing the digital sales model and identifying the right partner to create and manage the digital sales initiative, mobile operators can replace the expensive, ineffective retail store/call centre model with a new model that cost-effectively attracts both new smartphone users and existing prepaid users.