Publisher:
Telstra Wholesale
Name:
How the changing digital consumer impacts MVNO strategy - Part 2
Copyright Date:
20/08/2018
Copyrighted By:
Telstra Wholesale
Family Friendly:
Yes
Language:
English
Categories:

How the changing digital consumer impacts MVNO strategy - Part 2



Nicole McCormick, Practice Leader of Ovum’s Broadband and Multiplay team, discusses MVNO market trends, growth and strategies to address the ‘changing digital consumer’. 

The first part of our ‘changing digital consumer’ report focused on the need for MVNOs to move beyond a price conversation with customers, looking at how value-added services can add much needed weight to their offerings. In the second and final part of this article, we look at three further strategies for MVNOs to prioritise to help them meet the needs of today’s digital consumer.


Customer service as a differentiator

Customer service is central to the MVNO business strategy in order to not only retain, but acquire customers too. Indeed, nowhere is that retention more important than in the youth segment, where the 18-24 year old category rated poor customer service as their number reason for churning.

MVNOs should look to prioritise automated self-service. This not only gives the customer greater control over their plans and makes life much easier for them, but helps to keep the overall product matrix as simple as possible for the MVNO. As we move into the future, customer service will become a core battleground in the sector.
 

Loyalty programs

This is a very simple, yet effective way for MVNOs to retain customers. We’ve also had reports from across the world that loyalty programs help to increase existing customer spend too. In addition, those on loyalty programs achieve higher NPS scores than customers who are not.

Loyalty programs have already infiltrated global MVNO strategy, with Circles.com in Singapore a great example. They have interwoven loyalty schemes into their product offers, providing gifts for reaching certain milestones e.g. movie tickets, or offering data to a friend. Indeed, it’s not just proving to be a great retention strategy, but offering data ‘gifts’ is proving to be a great way to attract new customers too.
 

Tariff innovation

The final strategy we’d advise MVNOs to consider and to differentiate them is through tariff innovation. One example is US MVNO Ting, which allows consumers to only pay for actual usages, while Circles.com allows consumers to change their plan according to their perceived usage.

We’d also advise MVNOs to focus on the data component of the tariff offer, which could mean providing a plan that charges just for data, but allowing the consumer to layer on some voice and text to their plans if they so desire.

Shared data has been around for some time, but it’s also another great way to make a customer ‘sticky’. It’s a simple strategy that acts as a great anti-churn management tool and is harder to unravel, particularly for the family market.

And while data allowances are growing, and in some cases becoming unlimited, be careful not to cannibalise the upsell opportunities to your customers by giving away too much. Segmentation is vital as I’m sure we all know, but one size does not fit all. While on the flipside, don’t overcomplicate the tariff either. Keep it simple, and transparent, making sure there are no hidden costs or details buried in your offers.

Overall, it’s an exciting time for Australian MVNOs, with opportunities abound to increase revenues and take advantage of a consumer who is willing and able to be bold and try new things in this new digital era. The decision now rests with MVNOs as to how much of that opportunity they wish to pursue.

If you missed reading part one of this article, you can find it here. 

Nicole McCormick
The Author Nicole McCormick

Nicole McCormick is Practice Leader of Ovum’s Broadband and Multiplay team focused on delivering an Asia Pacific outlook to coverage such as pricing strategies, LTE monetization strategies, telco innovation and mobile roaming.

See all of Nicole McCormick's posts


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