Data analytics is a powerful weapon but it must be laser guided or you will waste a lot of time, money and manpower, writes Nick Booth.
Lande: In technical
terms CSPs still have a
long way to go
One of the dilemmas facing the modern communications service provider (CSP) is that they haven’t exploited their subscriber base as ruthlessly as their counterparts in other industries. Perhaps in the long term, that might be a good thing, because the higher levels of trust customers have in CSPs might eventually be a bonus when we all start using our smartphones as a payment mechanism.
In the meantime it appears that CSPs have much to learn from Facebook and Amazon’s ability to find out what their customers want and sell it to them. When telecoms software company AsiaInfo commissioned research into this, it discovered that European CSPs think they’re two years behind the so-called GAFAs – Google, Amazon, Facebook and Apple – when it comes to exploiting personal information.
“In technical terms CSPs still have a long way to go,” says analyst Justin van der Lande at Analysys Mason who led the research for AsiaInfo. Whether CSPs should be investing in more technology or more techniques is a moot point. It is clear they are both not getting the right insights and also failing to act on those they do get. The study ranked CSPs into four groups, according to their competence in customer analytics. The biggest category – dubbed The Unbelievers – comprised a majority of CSPs that had no vision of what they wanted and no tools.
Should CSPs become like the content providers? Arguably no, because then they’d be trusted about as much as Facebook. “Customer privacy is taken very seriously,” says Dr Andy Tiller, the vice president of product marketing at AsiaInfo, “but it’s within the CSPs’ control to use data sensibly in a way which provides value to their customers.”
A priority would be to change some of the established business processes because the data that needs to be analysed is stuck in different silos and difficult to share within the company.
within the CSPs’
control to use data
sensibly in a way
which provides value
to their customers
Throwing money at the problem doesn’t help, says Kevin Stanfield, analytics product manager at MDS. If the wrong people are asking the questions, the money you invested in their analytics systems will have been wasted. It’s important to realise that data analytics, like all IT projects, must have tangible business cases. Being able to analyse huge amounts of data quickly is not enough.
CSS should choose their data analytics battles carefully so they understand the business and can target it and measure it. “Knowing something about your customers is not the same as being able to take positive actions,” says Stanfield. All too commonly, Stanfield says, the only reaction data insights evoke is ‘so what’.
The problem for smaller CSPs is that they neither have the budget nor the in-house expertise to exploit the opportunities that data analytics could present. Avoiding the arms race for bigger and faster data analytics can be an advantage. Smaller CSPs can benefit by being much more focused and only concentrating on what’s important. The use cases around network performance and quality are most compelling, says Stanfield. When this data can be overlaid with customer data such as lifetime value, contract status or profitability, the value of that information multiplies.
CSPs who can combine OSS and BSS data can make much more advantageous decisions but, without due consideration to the data model that underpins the analytics, it’s all a waste, Stanfield says. Amazingly some CSPs still try to upsell to customers who are complaining – because analytics told them to.
abuse or fraud through
identifying an
inappropriate pattern
would work
The most instant gratification a CSP could enjoy from data analysis would be looking at BSS and OSS data for unusual usage patterns. “Much can be gleaned from calling patterns. Mitigating abuse or fraud through identifying an inappropriate pattern would work,” says Vic Bozzo, the vice president of sales and marketing at Telarix.
One small significant tweak that CSPs could make would be to add a layer of context to all the BSS and OSS information they already have, according to Jim MacDonald, the vice president of global marketing at UXP Systems. The way that some CSPs manage video on demand exemplifies this. The business and operational data tells you the account that is ordering the video services, but not the actual user. By getting more detail and creating user profiles on a video on demand service a CSP can start issuing user-specific recommendations. The head of the household isn’t the one that falls for those tempting offers, so the kids should be targeted.
One CSP found that the purchase rate for households where specific user profiles were created within their accounts was 81% higher than when they hadn’t. Data analytics has to be locked onto a target like a laser. “A return on investment in data analytics can never be assured,” says MacDonald.
