Customer-Driven Migrations: Interview with Clintworld’s Consultant Experience
With hands-on experience in the field of data analytics and artificial intelligence, our very own Nauman Ahmad describes Clintworld’s innovative approach to migration and pruning, and how Telcos can utilize client data to spot hidden opportunities.
The telecommunications industry has slowly been wising up to the importance of two particular processes: migrations and pruning. Apart from tried and tested telecommunications measures, understanding how to foster individual customer loyalty has become increasingly essential to an improved customer lifetime value.
We had a chance to sit down with our very own Nauman Ahmad, one of Clintworld’s migration consultants behind the E-Plus/Telefonica merger, to reflect on the state of the industry and a few lessons from his migrations playbook. Read on to learn more.
Interview
Clintworld: What do you see as the main challenges facing the global telecom industry today?
Nauman: The telecommunication industry is at a gridlock. Where when obtaining market share, it’s no longer sufficient to rely solely on new technology and low rates to win over customers. Trends are moving away from this sort of growth through acquisition and towards growth through customer loyalty, which can be achieved through the continuous improvement of their product lifecycles.
With the understanding that—if done incorrectly—any migration poses a risk of negative emotional and monetary impact, many Telcos shy away from such undertakings or approach the solution half-heartedly. We propose that through the use of their deep customer knowledge, Telcos can effectively turn loss-prevention into a win-win.
“With the use of deep customer knowledge, Telcos can effectively turn loss-prevention into a win-win.”
Clintworld: What sort of triggers should cause Telcos to consider migrating their customers?
Nauman: The reasons for undertaking a migration can be versatile. Optimizing new service plans according to a change in customer usage behavior is one market-driven motivation. Others are derived from complications in the current product portfolio, where they’re either no longer up-to-date, unprofitable or in serious need of simplification. Regardless, they should occur periodically, not only to refine, but to engage the customer base.
The most critical compelling event is an M&A, so any kind of Merger and Acquisition. They’re typically pressed for time, and their complexity comes in all shapes and sizes: sometimes as two operators with similar capabilities, or a combination of different capabilities (such as varied strengths in mobile, fixed, internet, etc.). With this enormous level of constraint, it’s easy to forget the customer and their needs. As such, it makes perfectly sense to perform a pruning exercise in all of these scenarios before the migration, ensuring the right tariff gets to the right customer at the right time.
Take the E-Plus/O2 merger, for instance. With over 20 years of distribution, E-Plus had a lot of legacy portfolios that just had to go. Careful pruning exercises and a well-defined simulation-ruleset, with respect to revenue-impact, regulatory and legal requirements (such as equal or better, which ensured each subscriber would get more or the same for less or the same), achieved a 99.99% tariff prediction accuracy, with <1% contract adjustments after the first bill. Without this attention to detail, customers would have churned.
Clintworld: When it comes to M&A’s it sustainable to have three to four operators performing in each market?
Nauman: Typically, if we see more than three operators, there’s a higher probability for an M&A to occur. For instance, in Germany we currently have three and a half operators. Telekom, O2 and Vodafone being the prominent players, while Drillisch is considered the half. When Drillisch comes out as an operator themselves, a merger will be imminent.
Clintworld: How should Telcos approach a customer-driven migration?
Nauman: The main challenge in a typical forced migration is to minimize immediate customer and NPS impact, often identified at the customer call-center, which could lead to high customer churn.
In essence, this can be achieved with an accurate technical ruleset, as well as the right value proposition (more for the same, the same for less, etc.), though telecoms can utilize something even more valuable: customer data.
Through the utilization of essential data points (such as usage behavior, willingness to pay, contract period, propensities, etc.), two customers with identical price plans could end up migrated into separate—better suited—target price plans. This method essentially shifts the focus from a traditional tariff-level migration into a loyalty-focused, customer-level one.
That’s where a cascade migration comes in, where customers are migrated in batches, results are thoroughly analyzed, and the migration ruleset is adjusted to achieve an improved customer lifetime value.
Clintworld: What challenges do operators face when performing such migrations. How does Clintworld help?
Nauman: As I mentioned, operators are generally intimidated by the complexity of their own portfolio, burdened by the thought that any dramatic changes will negatively effect their customer base. However, Clintworld has the experience of working with a wide range of BSS/OSS and can handle such complexities out-of-the-box.
That’s where the second challenge comes in: not having the transparency and flexibility during the migration process. As opposed to having a fixed ruleset at the beginning of any migration, simulations can predict the outcome with billing-like precision. If the simulated revenue, APRU-loss, or customer churn is undesired, one can go back to the original ruleset and make amends.
In the end, we help look for opportunities not only for today but, more importantly, opportunities for the next generation of customers and the coming decades.
Clintworld: Thank you for taking the time, Nauman.
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