Churn Reduction Strategies Update
2016.11.07   |   29 pages   |   Customer Experience and Connection

Author:
Robert Harrison


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Churn continues to provide a significant and costly challenge to the mobile industry.  While some level of churn is inevitable, operators need to keep it to a minimum if they are to contain their costs of doing business.

In an attempt to find an effective means of reducing churn, mobile operators have adopted a number of different strategies and continue to seek fresh approaches.  Many MNOs have introduced additional services that enhance or complement their basic communications services in the hope that these will engender greater loyalty and increase the stickiness of their services.  Others have placed greater emphasis on improving customer service and customer experience.

In 2014 and 2015, MMD published four MWP reports that looked at different approaches that had been adopted by MNOs in an effort to reduce the scale of the problem.  These reports included case studies of operators that had employed multi-play, OTT partnerships, digital services or customer experience.  The reports looked at approaches taken by operators in both advanced economies and in emerging markets, including Eircom, EE, Millicom, Telesom, TELUS, Tigo and Vodafone.

This report reviews the causes of churn and revisits the case studies examined by the earlier reports to establish which strategies have proved most successful in delivering further reductions in the level of churn or in maintaining low levels that had already been achieved.

 

Companies: Eircom, EE, Millicom, Telesom, TELUS, Tigo and Vodafone, Sky, Netflix, Spotify, Deezer, Apple, BT, Google, Three Ireland, ZAAD, Somtel, Dahabshiil, BIMA, UASen, Rogers, Juva, Salesforce,

Countries: Canada, Ireland, Ghana, Senegal, Somaliland, Tanzania, UK

Keywords: ARPU, Music Streaming Services, EBITDA, OTT, Customer Life-time Value, Net Promoter Score (NPS), Customer Satisfaction Score (CSAT), Churn, Multi-play, Postpay, Video Services, Consumer Effort Score (CES), Customer Satisfaction, Prepay, Digital Service Partnerships, Mobile Financial Services,

1

Overview

1

2

Introduction

2

2.1

Background to the Report

2

2.2

Report Content

2

2.3

Currency and Conversions

3

2.4

Further Questions and Feedback

3

3

Churn – The Continuing Challenge

4

3.1

Introduction

4

3.2

Causes of Churn

4

3.3

Inclination to Churn

5

3.4

Customer Lifetime Value (CLV)

6

3.5

Churn Reduction Strategies

7

3.5.1

Getting the Fundamentals Right

7

3.5.2

Stickiness of Adjacent Services

8

3.5.3

Customer Experience

8

4

Multi-play

9

4.1

Introduction

9

4.2

Eir (Eircom)

9

5

OTT and Digital Service Partnerships

14

5.1

Introduction

14

5.2

Orange and Deezer, EE and Apple Music

14

5.2.1

Streaming Service

14

5.2.2

Churn and ARPU

14

5.3

Vodafone and Sky, Netflix and Spotify

17

5.4

Mobile Financial Services

19

5.4.1

Overview

19

5.4.2

Telesom ZAAD

19

5.4.3

Microinsurance from Tigo

20

6

Customer Experience

21

6.1

TELUS

21

6.1.1

Churn and Customer Satisfaction

21

6.1.2

Business Performance

23

7

Conclusions

27

8

Recommendations

29

 

Appendix – Feedback Questions

30

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