Prepaid Loyalty: Fact or Fiction
The prepaid Loyalty Challenge
Prepaid business presents a challenge when discussing the loyalty factor. How do you create and nurture a long-term relationship with a customer when you don’t even have their name or address? Prepaid customers enjoy the simplicity and freedom of no commitments or contracts. Joining a service provider is as simple as buying a SIM card from the local grocery store. In addition, prepaid subscribers in many high growth markets are low-spend customers, which limit the marketing resources service providers are willing to invest in retention. The result: constant prepaid customer churn. Indonesia, for example has one of the highest churn rates at over 10% a month, while the Philippines has almost 5% monthly churn on average. How then are service providers supposed to create and encourage loyalty from a prepaid customer base that is able to churn at will?
| Leave a Comment September 27th, 2010
Prepaid Customer: What you do is who you are
Anonymity is probably one of the most frustrating factors for marketers servicing the prepaid market. A Prepaid customer purchases a SIM card in a kiosk, leaving behind no trace of identity – unknowingly preventing any segmentation of core services. You cannot maintain an ongoing relationship with the customer – an essential component for building loyalty and for identifying opportunities to increase share of wallet.
| Leave a Comment September 27th, 2010
Ovum Recognizes Pontis as Leader in Loyalty Solutions Preventing Churn
In a research conducted by Ovum; “Post-recession strategies: loyalty grows in importance”, Pontis is recognized as one of the main solutions enabling service providers to increase loyalty and significantly reduce churn.
According to the report, most services providers initiate loyalty plans through consumer promotions such as free cinema tickets, which can be perceived by customers as meaningless promotions and intrusive. Ovum suggest that instead, operators should provide valuable, targeted and personalized offers , while at the same time giving customers the sense of personal dialogue. In a crowded and mature mobile market, in which loyalty programs are essential, Ovum recommends that operators differentiate themselves with contextual marketing in order to provide the right offer at the right time.
According to Ovum, Pontis addresses these issues and can assist operators to overcome these challenges. The Pontis solution enables operators to design personalized and contextual marketing programs and automatically deliver offers in real time to customers. The Pontis solution helps operators stand out from the competition, while significantly increasing their ARPU.
| Leave a Comment July 20th, 2010
Case Study: Enriching Marketing Campaigns With Context Pays Off for a Tier 1 European Mobile Operator
Gartner has published a case study* in which they document how the use of real-time, contextual information, targeted highly relevant offers to individual customers, have helped a Tier 1 European provider boost their service revenue from prepaid phones, enhance customer loyalty and reduce churn.
The main findings illustrate how the operator has succeeded to follow and better understand the individual needs of their entire customer base and based on this data offered specific targeted prices and products which were highly relevant to individual subscribers. Due to the real-time execution and automatic fulfillment of these offers allowing quick follow-up, and guaranteeing higher response rates, the operator had succeeded to increase overall revenue per subscriber: “offerings that are personalized to the customer segment and presented when the customer is most receptive generate tangible new revenue.”
In this example, the case study highlights how the operator’s “acceptance of promotional offers rose from 2% – 10%.” It further explores how the operator has managed to create an ongoing dialogue with their customers.
Furthermore, the case study recommends that “vendors should target the marketing team, rather than the IT or business intelligence (BI) teams with their products. Highlight that this type of approach allows marketers to radically change the way in which they create and manage promotions”
In addition it is recommended that: “Communications service providers (CSPs) should select a vendor with a proven track record of successful implementations and comprehensive consulting services — they will need to rely on the vendor’s advice to avoid the most common mistakes when creating this new type of campaign”.*
Gartner, Inc.:. Publication ID Number: G00175497
Gartner research is available at www.gartner.com
| Leave a Comment July 20th, 2010
Russia the Freedom of Choice: Multi SIM Ownership Drives Churn and Decreases ARPU
Russia has the largest mobile market in Central and Eastern Europe and is continuously growing. At the end of May 2009 the total number of subscribers reached 194.7 millions, with customers being wooed by three major service providers (MTS, VimpelCom and MegaFon). Competition has further intensified with the growing penetration of multiple SIM ownership. As the majority of handsets are not purchased through the operators but rather from independent stores, Russian mobile operators could not lock handsets to their networks, and consequently customers can benefit from different operators’ SIMs on a daily basis. Read more
| Leave a Comment July 20th, 2010
Pontis recognised as “Cool Vendor” for Context-Aware Computing 2010
Gartner has recognised Pontis as a “Cool Vendor” in their 2010 report, highlighting that, “…context will be a technology that redefines customer experiences and relationships, and, as these Cool Vendors demonstrate, it can deliver value in 2010.”
The report is based on evaluation of vendors that are innovative, impactful and intriguing. The Marketing Delivery Platform™ allows mobile, TV and fixed line operators to target customers with contextual marketing offers.
Real-time contextual marketing andselling, based on a customer’s lifecycle and real-time events, enables operators to push price and product offers at the right time, increasing the response rate by as much as 10%. In today’s fierce competitive markets where power is shifting to the customer, Pontis’ solution helps operators to develop personal relationships with their customers.
Furthermore, the Pontis’ solution allows operators to run hundreds of highly targeted promotional offers simultaneously on a monthly basis, which can be implemented within days, rather than weeks.
Gartner, Inc. Publication ID Number: G00175299
Gartner research is available at www.gartner.com
| Leave a Comment July 20th, 2010
Segmentation vs. Behavioral Life Cycle Management:Getting the most of Your Marketing Efforts
The saturation levels of mobile markets and the low exit barriers for customers have caused many operators to shift the weight of their marketing efforts from new customer acquisition to customer retention. As part of this trend, operators are investing lots of funds on sophisticated customer segmentation solutions. Yet, are these segmentation efforts really delivering the desired results? Are common proactive marketing practices, based on traditional segmentation succeeding to increase customer loyalty and profitability?
| Leave a Comment June 16th, 2010
Protecting your Prepaid Base in a Competitive Market
Wikipedia defines churn as “a possible indicator of customer dissatisfaction, cheaper and/or better offers from the competition, more successful sales and/or marketing by the competition, or reasons having to do with the customer life cycle.” How can you avoid churn and nurture long-term relationships with your prepaid customer base in a competitive market consisting of customers that have no contractual commitment?
In the context of mobile subscribers, “churn prevention” is almost synonymous to “loyalty” and “retention.” While “loyalty” points to the required activities to keep customer faithful, “retention” makes sure customers do not leave, with superior offers and other customer-centric activities, compared to the alternatives provided by the competition. To ensure these two vital factors are fulfilled and have a real impact on your customer base you must establish real-time contextual marketing and selling capabilities.
| Leave a Comment September 8th, 2008
Building A Synchronized Set of Prepaid Offers
This is the third and final post in a series of three where we revealed how we went about impacting prepaid behavior in our work with one of the largest prepaid operators in the world.
The following are the main behavior indicators we take into account when building a synchronized set of offers to different segments. To see how we impacted each please see the before and after graphs in How Do We Impact Prepaid Behavior?
> The time period that goes by between top ups – the shorter the period is means the subscriber is more active.
> The time that goes by from reaching a zero balance until the next top up is even more important, because each day that goes by without talking, means the subscriber could be churning. This resonating silence is referred to as a ‘dormant subscriber’.
> The third factor is the date of the last call, or days from the last call. This is extremely important because since there is no contract, there is no proactive activity involved in case the subscriber wants to churn like calling the operator to terminate service. That is the main reason why so many prepaid subscribers become dormant, and why this phenomenon is often referred to as ‘passive churn’.
| Leave a Comment August 3rd, 2008
Impacting Prepaid Behavior To Increase Revenues
The big race to retain customers and maintain their level of usage has proven to be extremely challenging in the prepaid sector. Generic characteristics of this service, lack of users’ data and minimal differentiation bring marketing challenges to new heights.
This post is about the best way to overcome these obstacles and go about impacting subscriber behavior in one of the most lucrative revenue sectors for mobile operators – the prepaid sector that is comprised of over 1 bln subscribers worldwide. The following insight is based on our activity with one of the largest prepaid operators in the world.
Our first challenge with this operator was to increase usage within a “mid–ARPU” prepaid segment. Experience has taught us that the best way to impact behavior in this segment is to integrate real time and immediate response tactics into all marketing activities. Here is a real life sample of how we went about increasing top up recharges and voice usage for subscribers with an average top up amount of lower than €10.
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