How to make telecoms customers feel like they belong
In an era of customer-centricity, operators are becoming increasingly concerned by the way in which they serve their customers. This has led to operators’ shifting their focus to ensure customer loyalty and advocacy metrics are integrated into their business strategy and KPIs.
Telco service providers are right to be concerned; with market competition fiercer than ever, quality of customer experience is one of the few ways in which they can differentiate. But customer experience isn’t simply about your share of wallet, net promoter score, or even overall customer satisfaction metrics.
Instead, service providers must focus on customer retention and providing their customers with a sense of belonging. By pursuing a membership or community-based approach, they can boost the way they interact with customers and the way they make them feel, says Dr Janne Ohtonen, director of Customer Experience Management, Openet.
Belonging in telecoms
As individuals, we all have an ongoing emotional need to be accepted as members of a group –starting from childhood when we are in the school playground, to adults when we are signing up with our service provider.
Telcos need to be fully aware of this and act accordingly. If an individual is treated like a mere subscriber, their emotional connection and their attitude towards the brand will be impacted. Service providers should therefore consider carefully whether an individual is to be treated as a subscriber, a customer or a member.
Join the club
Membership-based approaches in telecoms have been around for some time. Most of us will be familiar with O2 Priority in the UK and 3Plus in Ireland. Both are good examples of how customers are made to feel special – an part of an ‘exclusive’ membership group – by offering pre-sale tickets to major sporting, musical and theatre events.
GiffGaff is another UK service provider that is seeing significant value from its community-based business model. To become a member, customers simply purchase a product. No contract is required and members are allowed to change their plan every month. Unsurprisingly, in January 2017, the company was ranked best UK service provider for customer satisfaction by The Institute of Customer Service.
It’s clear that membership and community-based approaches can help service providers build a strong connection between customer and brand. Thus ensuring brand loyalty and helping to drive more sales through higher Net Promoter Scores and measurable customer satisfaction.
What’s more these approaches can also be beneficial for operators in accessing customer opinion. According to research from Salesforce, 86% of Fortune 500 companies reported that communities provide better insight into customer needs and 64% stated that brand community has improved their decision-making (Crezeo, 2015). The feedback from members is invaluable. This willingness to offer up ideas and comments in allows operators to make improvements to its products and services that will have a positive impact on its customer base.
Establishing and maintaining appeal
There are four main components to be considered if telcos are to successfully embark on a membership or community-based approach. These are membership, influence, meeting needs, and sharing an emotional connection.
When customers are treated as mere subscribers, they are likely to have a lower emotional connection with the service provider as the relationship is seen as a transactional one. By forging a membership-based relationship, operators can reach higher levels of emotional engagement with their customers. The sense of belonging brought about by a membership can automatically make them feel that they are part of something bigger than themselves. And not just a means to a revenue-focused end.
It’s also important for members to feel they have an influence over the brand, and for the brand to feel they can influence members. Indeed, if influence does not work both ways, it can become tiring. A membership typically requires some effort and commitment from the member, therefore needs some sort of benefit or incentive is needed or it will quickly be worthless.
Bought, earned or exclusive
Service providers wanting to create their own membership model do not have to choose between community or membership approaches. Instead they can incorporate both into their services by mixing and matching a wide variety of membership-based approaches. These can be bought, earned or given exclusively by the operator.
‘Bought membership’ models do what they say on the tin: anyone can buy in.
‘Earned membership’ models allow individuals to earn their membership status through activities. For example, through frequent-flyer programs. Once an individual has completed an adequate number of qualifying actions (such as flights), the airline awards a membership status that gives specific benefits. However, ‘Earned membership’ benefits can be much simpler, for example collecting points with a supermarket in exchange for online and in-store vouchers.
Lastly, there are ‘exclusive’ membership types, whereby ‘courtesy services’ are offered according to customers’ ability to fulfil certain criteria.
Taking the plunge
There are several factors to consider when deciding whether a membership-based approach would work for a service provider. Would their customers benefit from gaining a sense of belongingness? Could their existing business model seamlessly incorporate membership-type model?
Service providers should think carefully about their future aspirations; do they hope to be market leaders or a simple, low-cost service providers? If the former is true, then a membership approach might prove to be the key differentiator.
The author of this blog is Dr Janne Ohtonen, director of Customer Experience Management, Openet
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