Restoring connections

How telecommunications providers can reboot
the customer experience

Commoditization is a serious threat to the telecommunications industry. Most CSPs offer similar services at rates designed to win what has become a price war. As a result, many face decreasing margins and difficulty sustaining differentiation based on prices or products alone. On top of commoditization, CSPs also face competition from OTT providers and an increasingly knowledgeable and demanding customer base. With access to growing amounts of data from an ever-increasing number of sources and devices, today’s empowered, savvy consumers know what they want and expect to get it.

Indeed, digital technologies have changed consumer behaviors and expectations. In addition to quality products and services, consumers now expect quality experiences. The value has moved away from the product or service itself and toward the customer’s experiences with it. These experiences represent a distinct economic offering, and one that consumers increasingly desire.

CSPs should focus on resetting the customer experience, building compelling products and services, and deploying smarter capabilities

In confronting this new shift in value, CSPs face some challenges. The primary hurdle involves their existing customer experience reputation. Generally, telecommunications is not considered a role model industry for positive customer experiences; no CSPs were cited as leaders on any customer experience scorecards we consulted. This reputation has affected customer loyalty. According to our most recent telecommunications consumer study, only 16 percent of consumers are real advocates for their provider. More alarming is the fact that almost half are antagonists, who harbor negative opinions and possibly bad mouth the provider.

It’s time for CSPs to turn the tide. How can CSPs escape commoditization, improve their customer experience reputation and set themselves apart from competitors? We believe the next competitive battle will be won by CSPs that can deliver an exceptional customer experience.

In the new customer experience economy, telecommunications needs to move away from an “inside-looking-out” orientation focused on solutions, sales and the organization. Based on our research, we believe the industry should move toward adopting an “outside-looking-in” orientation, where everything is focused on and built around the customer perspective. By doing so, CSPs can begin to reset the telecommunications customer experience and build brand loyalty through innovative, compelling, personalized services based on deep customer insights.

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