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Submitted by Industry Comment on Tue, 16 Oct 2007 17:52 |
From mass marketing to user centric marketing: the new techniques for creating dynamic, personal marketing offerings. The notoriously competitive and rapidly evolving market for telecommunications consumers is bringing marketers within this sector new and ever escalating challenges, but also tremendous opportunities.
Managing a digital product and service portfolio that often spans thousands of items, with the current shift towards delivering converged offerings of broadband, mobile and entertainment services, now means that mobile, cable, VoIP and IPTV operators are facing a very complex environment while fighting even harder to drive new revenues from existing customers and reach new customers.
In the saturated mobile space, operators struggle with high customer churn and continuous price erosion as new low-rate operators and MVNO’s enter the market. Customer acquisition costs are high and retention is a top priority in a market characterised by low levels of product differentiation where customers will simply shop around for the best deal.
Combine this competitive landscape with the added complexity of the products on offer - more products are being introduced to market at an ever increasing rate through a variety of different channels to users with varying subscription types and devices – and the scale of the challenge for marketers within this sector is evident.
“One-size-fits-all†Marketing
However, the traditional mass-marketing “one-size-fits-all†approach is no longer tenable in this environment. Services and bundles of products are offered with limited flexibility in terms of customisation or personalisation and, as such, many of the messages delivered will fail to convert a user to adopt a new service or purchase a new content item.
Mobile advertising, for example, has generated huge hype and is now being touted as a solution for driving revenue from third party advertisers through personalised messages or access to content such as the offer of free downloads. Yet, such techniques represent a missed opportunity and will deliver a lower ROI than possible if poorly targeted, mass communicated, or delivered at the wrong time.
The key challenge for all marketers in this sector if they are to survive and thrive in this environment is to leverage their strengths and to target the right customer at the right time with exactly the right proposition.
The Personal Approach
In this sense, the industry needs to follow the example set by on-line service providers who have long maximised the potential of the ‘personal approach’ with interactive suggestions linked exactly to the users’ preferences and real time behaviour (e.g browsing or purchasing). “Amazon-like†recommendations based on buying patterns can be used by operators to promote a “cross sell†of related content items, or to use “up sell†techniques in order to encourage customers to purchase additional content, such as music bundles, all based on the lifestyle characteristics of a carefully segmented group of customers.
Operators now need to adopt these more sophisticated techniques through the use of marketing delivery platforms to address specific, well defined customer segments with relevant offers. The arrival of new solutions specifically designed for marketers within this sector, is now providing the capability for them to do this, by monitoring usage of services or products in real-time to enable behavioural-based targeting; an approach that, until now, has simply not been possible.
A marketing delivery platform provides telco marketers with an end-to-end design-execute-measure environment to deliver real time targeted and personalised marketing offers. This ties marketing design, on-line sales, dynamic communications and product offer processes, effectively automating the marketing IT. Such systems allow products to be configured dynamically (including special terms) and to be communicated in real time to customers, based on their preferences, history and current usage.
This may seem logical, however, in reality, it marks a significant step forward in an industry hampered by silo-based thinking, lack of flexibility across the different operator’s departments, and a non-systematic, non-automated approach to targeting customers.
Improving ARPU in the Real World
This personalised approach to communicating with the customer has been proven to deliver compelling results.
The technique was used to great effect by a European mobile operator as part of an Easter MMS promotional offer to its customers. AS part of this, the operator offered a happy hour for non MMS users, a ‘buy one get one free’ for low MMS users, which were divided into two segments and a ‘buy two get one free’ offer for medium MMS users. A cross sell of a greeting MMS applications was used for high MMS users. The offers were communicated by SMS message and through banners in the mobile portal with unique offerings for each segment.
As a result of these targeted offers, all MMS promotions achieved more than 100% growth during the promotion period, compared to control groups and the number of MMS greetings was 16 times higher than an average day before (compared to control groups).
Achieving these results means that operators must fine tune their processes and adopt a more targeted approach by aggressively marketing highly tailored offerings. This is the strategy that operators will need to embrace if they are to out-perform the competition and improve levels of customer retention and profitability.
by Guy Talmi, Senior Marketing Director,
Pontis
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