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Can communications services providers earn their customers' love?

Can communications services providers earn their customers' love?

Those that can will outpace their competitors over time.

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Can communications services providers earn their customers' love?
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Ask a friend whether he would recommend his mobile phone, Internet or cable provider, and chances are you won’t be convinced to sign on with that company. The truth is, across all three markets, customers typically go with the least-objectionable provider rather than one they feel strongly about.

As long as subscriber numbers continued growing, providers could accept being “good enough” in customers’ eyes. But with penetration flattening and competition intensifying, companies in all three markets must fight harder for market share. To succeed, communications services providers now will need to earn their customers’ love so that they remain loyal when tempted by competitive offers.

To understand what companies could do to gain ground with customers, Bain & Company recently surveyed almost 3,000 US customers in the wireless, fixed Internet and pay-TV markets. The survey provides important insights. Customers want companies to satisfy their basic needs in the areas of price, network coverage and customer service. But to gain a competitive advantage, operators must differentiate themselves by exceeding expectations on some elements of the customer experience. Providers need to figure out which areas matter for their customers and determine where there is significant value in over-delivering.

For example, in wireless, we found that many customers like being notified if they go over plan limits. In fact, they find such notification as attractive as a $4 monthly discount on their bill. By analyzing customer data for all product and service elements, we identified the 10 critical dimensions of the customer experience that give companies the biggest opportunity to win, delight and keep their customers. For some, communications services providers already have found a winning formula. For others, they can learn from winners in different industries.

Find out what excites different customer segments, and create a value proposition to satisfy them. This is what MetroPCS Communications does by tailoring its service to customers who simply want the least expensive deal—it’s all prepaid, with no surprises.

Get the customer to talk about your positive attributes to the right people, especially on social media. Dell Computer is a great example of a company that uses social media to create buzz and referrals. As one element of a broad social media strategy, the company’s @DellCares service allows the company to interact with potential customers online and facilitates interaction between satisfied customers and potential customers.

Be passionate about educating customers when you sell to them, and make installation and activation as smooth as possible. Unlike many of its peers, UK-based mobile operator O2 uses the sales process to build long-term loyalty. Technology gurus show new Smartphone customers how to use them so that they’re proficient before leaving the store – and gurus are easily accessible via a Smartphone icon after the purchase.

Deliver an exciting product experience that differentiates you from competitors in at least one area important to your customers. Create a “wow” product experience by introducing new features as Netflix did with its adaptable video-on-demand interface or by differentiating an aspect of the product experience such as user-friendliness.

Nobody likes getting bills, but keep customers from complaining with clear and accurate bills. By making the billing process less painful, companies avoid frustrating customers to the point of defection—with the positive result of increasing satisfaction.

Be a champ about resolving issues. This is a critical customer pain point. Communications services providers could learn from Amazon.com’s “call me now” and “call me in five minutes” options, designed to tackle problems quickly.

Create pleasant and effective processes for upgrading, cross-selling, renewal and relocation services. To increase satisfaction, SK Telecom helps customers purchase the latest handset by offering rolling subsidies that allow customers to buy new phones before the end of their contract or spreading payments over the remainder of their contract.

Let your high-value customers know it and shower them with rewards. Long-term customers often are frustrated by deals that apply only to new customers, which is why US Cellular uses tenure as the basis for awarding loyalty points redeemable for desirable products and services.

Know how to proactively detect when your customers are disappointed—and how to change their minds. One wireless provider identified at-risk customers and offered them customized solutions such as no-fee plan switching, a strategy that reduced churn and lowered deactivation calls by 15 percent in the first six months.

When customers opt to cancel, have a plan for bringing them back—at least the ones you want to keep. One provider monitors competitors to detect enticing offers before or when they hit the market, then reacts with equally attractive counteroffers.

Knowing these ten dimensions is the first step. Winning companies create their own vision and roadmap for earning customers’ love. That involves defining the case for change, understanding the causes of defection, and redesigning the customer experience. They create a “wow” effect by determining what will make a difference to customers and having a laser focus on excelling in those areas. Delivering requires building supporting processes and platforms and transforming the organization and culture – ensuring that the people behind the effort are well trained and enthusiastic.

Understanding what customers want and creating offerings that exceed their expectations is difficult. But communications services providers that can get their customers to love them and become vocal promoters will outpace their competitors over time.

Domenico Azzarello is Bain & Company partner in Paris, and Mark Kovac is a partner in Dallas.

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