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INSIGHTS / Articles

Telcos Battle Low Customer Experiences

 1 Jun 2018 
INSIGHTS / Articles

Telcos Battle Low Customer Experiences

 1 Jun 2018 

The biggest challenge facing telecom companies is their low customer experience reputation. This is according to the IBM Global Telecom Consumer Survey, which looked at how customer loyalty is affected by their network service experiences.

Telcos Battle Low Customer Experiences

For the survey, 21,000 consumers in 42 countries were asked about their telecommunications usage habits, particularly in watching video on connected devices. The research also looks at how telecom companies create connections with their customers, and how willing customers are to share their personal data with telecom providers.

Mobile video

Watching video has become one of the main ways to consume content over the Internet, and the advent of smartphones and other connected mobile devices has meant that people can now also watch video on the go. Since the consumer experience has changed, telecom companies are adapting to this evolving environment by offering new services and experimenting with different business models.

However, compared to other types of providers, telecom companies are not highly regarded for their video services. Only 14 per cent of consumers value their mobile provider in emerging countries, while six per cent value them in mature markets.

Even as an increasing number of consumers watch video on their mobile devices, the experience does not seem to be meeting with their expectations. 66 per cent of respondents said they often or regularly encounter video buffering and stalling issues.

The journey of a video clip from a server to a mobile device consists of several steps, so there could be many reasons why video problems happen. However, customers have a tendency to first blame the telecom company.

46 per cent of consumers in emerging countries fault the telecom company for bad video experiences, and 29 per cent in mature countries. In cases of video quality becoming particularly bad, more than half of respondents said they would go as far as switch providers.

Data management

The Net Promoter Score (NPS) is a management tool used to measure the loyalty of a firm's customer relationships. The survey found that telecom companies generally have a negative NPS, often scoring much lower than various other industries.

Overall, customers rate telecom companies as average to good. Although companies are getting better at providing prompt and effective responses to queries (57 per cent), they are still struggling to provide personalised advice to improve experience (55 per cent).

Privacy of information has been a hot topic for years, and with the introduction of the General Data Protection Regulation (GDPR) in Europe, this is now on the minds of many consumers. In particular, there are concerns by the public in how their personal data is being monetised.

In order to stand out in a competitive marketplace, companies often turn to personal data to extract insights and create value for consumers. To do that, companies need to collect and analyse their customer data, which first requires trust from customers.

This is one area where the telecommunications industry has performed well. Telecom companies are only matched by banks in trust, beating out retail stores, social media and other companies that regularly handle customer information.

Currently, 30 per cent of consumers feel uncomfortable sharing their personal information with communications service providers. In comparison, 41 per cent feel the same with disruptive players, such as Uber and Airbnb, and social media companies.

Privacy concerns

While telecom providers score well in trust compared to other industries, trust in all mature countries has declined in the last three years. In countries like Australia and the US, it fell 17 and 18 per cent respectively.

In most emerging markets, consumers’ trust in telecom companies has increased. It grew seven per cent in India and 12 per cent in Nigeria.

Consumers increasingly want their providers to tell them how their personal data is used, as well as provide more control over their data. Their biggest concerns about data collection are it being sold to third parties (60 per cent) and failing to keep it secure (45 per cent).

What the survey shows is that to be competitive, telecom providers need to excel at the customer experience. Although telecom providers enjoy a high level of trust with consumers, they need to continue to effectively manage consumer data in various digital ecosystems.

We’ve already assisted telco companies such as iiNet, MARS Telecom and others with their digital transformations and improving their consumer experience. If you are looking for guidance with technology platforms and data security, contact us today to learn how we can ensure the best quality experience for you and your audience.

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