Enhancing Customer Retention Through Value-Added Tools and Strategies
In today's competitive market, ISPs must focus on developing customer-centric content and applications to increase customer loyalty. By understanding the main churn reasons and implementing tailored retention approaches such as product parameter improvements and price reductions, ISPs can effectively retain customers. While investing in speed upgrades and offering gifts may seem appealing, cost implications and long-term perception effects must be carefully considered to ensure sustainable growth. Simplifying and optimizing operations based on customer base dynamics is crucial for maintaining profitability in a saturated market.
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Customer Own Content Development & Application Tools as Added Value for Retention Petru FUIOREA ROL.RO
An ISP Customer base: Increases by Adds Decreases by Churn Main Churn reasons: Perceived Price Perceived Customer Care Perceived VAS Note: from Customer perspective What almost any Provider knows What almost any Provider knows
Focused on: Increasing product parameters Decreasing price Bundling with black boxes Usual Retention approach Usual Retention approach
Nice, since all customers have 100Mbps, now is time to invest to provide them 1Gbps ! Nope, not nice at all. Customer perception will be marginally influenced. And this with significant cost for ISP. Our comment Is nice indeed to provide more than what is expected, but bottlenecks remain, so the Customer will continue to feel the low speed determined by source regardless of its bandwidth. However, as for any upgrade, Providers may have a good time spending Downfall of Usual Model Downfall of Usual Model
Good, at this moment all customers are paying just about the cost, now is time to invest to reduce the price furthermore! Nope, not good at all. Is like you are paying customer for using your service. And you are not an ONG. Our comment: Changing Reduction. Investments determine a Cost Reduction only if manage to reduce OPEX in such way that the operation is a driver for Cost Reduction. cost model not necessary implies Cost Downfall of Usual Model Downfall of Usual Model
Look at these nice lap-tops. Will be cute to give one to each of our customers to build their loyalty! Nope, is not cute at all. In fact is awful for perception in mid and long term unless you decided to repeat the action each and every year. At least try do it on X-mas, so you ll contribute in keeping alive Santa Klaus story. Our comment These black-boxes increase the cost and raise Risks, which are very often wrongly mitigated. It is indeed mainly used, especially in mobile market. Is just that it develops a Thanksgiving Day behavior among customers, with the downsides it brings. Downfall of Usual Model Downfall of Usual Model
Simple arithmetic on customer base and operations: Adds-Churn = increase, if positive; decrease if negative; conservation if close to null. Complicate the simple Operations: Adds*SAC+Churn*AMPU = EBITDAdiminishing. Complicate furthermore, considering a saturated and price sensitive market: SAC increases, ARPU decreases. arithmetic, considering Bottom-line: Not sustainable model in mid and long term. Continuously increase of SAC and Churn drives the operations into unprofitable area Downfall of Usual Model Downfall of Usual Model
Provide ValueAdded to your connectivityservices Be sure this Value Added is so perceived by your customers Make this ValueAdded hard to be replaced or copied Ensure a marginal cost for bringing this ValueAdded Consider Premium versions as revenue generating VAS Or, in other words: Make your customers to use harbored Provider applications Make your customers contribute with content in sheltered users community net [Provider own net] An AnAlternative Alternative
Internet Access customer base: 240k Mobile customer base: 220k Churn Rate, Internet Access: 5% Churn Rate, Mobile: 5% Internet Access penetration: 11% Mobile penetration: 102% ARPU Internet Access: 9Euro ARPU Mobile: 2.5Euro Usual Retention Model implemented on both SADs For reference Moldtelecom, EoH1 2011. Figures in +/- 10% range Study Case What we found
An Interactive Platform For reference: see my.moldtelecom.md Study Case Study Case What we suggested What we suggested
Interactive Platform for Internet Access customers, as Added Value Videoconferinta Felicitari. [Specific local: Sf. Maria, Sf. Paraschiva, Estivale] WEBGAMES [Specific local: Ac iune, Shooting, Logice] LocalTUBE Divertisment Muzica WEBMAIL FREEHOSTING FILESHARING STREAMING Study Case Study Case What was implemented What was implemented
After 2 years, EoPdata On Products with Interactivity implemented: Churn Rate: under 0.5% ARPU: 9.6Euro On Products w/o Interactivity implemented: Churn rate: 5.5% ARPU: 1,5Euro Study Case Study Case The Results The Results
Do you need to diminish the CR? If Yes, continue, else wait patiently the end of presentation. Is the Usual Model suited for you? If Yes wait patiently the end of presentation, else continue. Do you have your Customer base segmented? If No, do it as soon as possible. Does the segmentation consider customer interests too? Like habits, traditions, lifestyle, aso. If No, is time to consider it. Do you know what are reasons for the Churn you are dealing with? If No, is time to understand them. Does your company offer Added Value? And what you named Added Value is it a differentiator? Do customers perceive it as you think it is? If answer is Yes, please wait patiently the end of the presentation. So? What a Provider may do? So? What a Provider may do?
ELSE: Perhaps is time to Add Value, to build Loyalty, to Influence Customer Perception. Let them create a community. Let them consider your company s services as NOT TO BE REPLACED So? What a Provider may do? So? What a Provider may do?
MAIN WLPs Community PORTAL WEB HOSTING VPS for B2B, B2C FileSharing Streaming Storage All with necessary applications as well ROL.RO ROL.RO - - White Label Products White Label Products
B2C B2B Online Social Marketing campaign Available Solutions Available Solutions as White Label as White Label
Yes, in case of correct implementation and manifested interest from Provider s management No, in case of limited or imbalanced implementation or limited interest from Provider s management Will be those successful ? Will be those successful ?
Well, is very, very simple Step 1: Let us know you are interested. By mail, phone, a.s.o. Step 2: Be prepared for a deep and fair talk. Step 3: Implement what we, together, decided to do I give it a GO. What next? I give it a GO. What next?
CONTACT DETAILS ROL.RO www.rol.ro office@rol.ro petru.fuiorea@rol.com.ro +40 735 300 475 Or please pick-up or let a Business Card Thank you for interest or patience Thank you for interest or patience
