Billing and billing analytics become operators’ strategic advantages in 2016

The Fast Mode

By Kirill Rechter
December 21, 2015

The marketplace for communications services will continue to be extremely competitive. Incumbents, mid-sized players and new entrants will be making strong pushes to retain existing customers and attract new business from competitors. At the same time, communications service providers (CSPs) will continue to struggle with narrowing profit margins and greater commoditization of their tradition service offerings. This will force CSPs to identify new service opportunities, such as virtualized IT business services enabled by NFV technologies, to differentiate themselves from their competitors will generating newer sources of revenue.

This comes as no surprise given that these trends have been around for some time now. However, how CSPs respond in the coming year to these trends will be different. For one, CSPs will start viewing their billing operations, service delivery and customer support processes with new strategic importance. As a result, we expect to see the following four trends transform the way CSPs offer and manage their services in 2016 and beyond.

#1: Holistic approach to billing operations and business processes

Billing is no longer just the functional process of calculating usage and generating invoices.

Going forward, CSPs will be looking to their billing operations as a way to improve customer loyalty and even attract new business. Efficient billing processes, easy-to-understand invoices, straightforward service packages and transparent charging methods are some examples of billing activities that CSPs will use to increase customer experience and engagement levels. As an extension of this, we expect that those CSPs that build efficient business processes will begin promoting their billing operations as a competitive advantage and will leverage them to differentiate their service offerings. More than this, many forward-thinking CSPs will consider their billing operations as an essential part of their corporate strategies and as a driver for growth.

This will mean something different to each CSP depending on its individual strategy and objectives. However, analyzing billing operations and business processes with a strategic approach is essential. Cloud-based solutions will significantly decrease investment requirements, while creating an open and scalable environment. Automation of workflows and processes will also be more effective when based on holistic best practices that reach all levels of the organizations.

#2: Using customer experience management as a metric to gauge customer loyalty

Like many marketing terms, customer experience management (CEM) has created a significant buzz and is attracting a lot of media and analyst attention. Our impression is that the meaning of CEM to CSPs is just starting to take shape.

Some in the industry might say that CEM is just a recycled way of saying what was previously referred to as customer care or customer relationship management. We would argue that given the readily-available competitive alternatives available to customers, CEM is much more than this. CEM is an important part of what has come to be known as a customer’s journey and is becoming increasingly important as customers today interact with CSPs on a daily basis.

The concept of CEM is becoming clearer to many CSPs and we expect that CEM will be understood as a metric to gauge the status of customers. This means that CEM programs and activities will be used to understand the satisfaction levels of individual customers and specific customers segments. This will enable a CSP to connect its CEM efforts to its overall business strategy and focus its attention on identified customer segments, such as keeping satisfied customers loyal, preventing unsatisfied customers from churning, investing more attention to profitable customers or avoiding high maintenance customers, while delivering correctly priced and packaged products and services.

Like billing, each CSP will have its own CEM strategies based on its objectives and current situations. However, the point is that CEM is taking shape with tangible metrics to measure its success.

#3: Leveraging real-time data analytics to offer better services and promotions

For many years, CSPs have been using various types of data analytics to better understand their customers and find new ways to offer the best possible services to them. The interactive data contained in billing systems has often been overlooked in data analytics efforts and we expect this to be the next resources to be leveraged by CSPs. The data in billing systems contains a wealth of information about the service usage habits of customers. A deep analysis of this data can enable a CSP to accurately adjust service delivery not only with the correct pricing, but also important aspects such as accessibility and timing of usage.

Based on an analysis of past customer behaviors and responses, data analytics can provide a range of predictions on how changes to services or packages will be received by customers. For example, if a loyalty package targeted at a specific customer segment is about to end, marketing managers can analyze how adjustments to the package, such the time commitment, pricing and included services, will impact the renewal rates of existing customers and the likelihood of new customers registering for the package.

#4: Turning mobile self-care apps into a sales and service channel

By connecting a customer’s mobile device to all billing and service delivery processes and ordering processes, CSPs will be able to better engage with their customers. Not only will such self-care mobile apps offer customers greater visibility and control over their usage patterns, but will also offer CSPs an important medium to offer new and customized services to each of their customers, while saving on call center-based customer service costs.

Self-care mobile apps can be leveraged as an important sales channel for communications service providers to push the most attractive offers to their customers and package it in a way that ties the offers to their individual requirements. Such mobile apps can be used by customers to understand their usage patterns better as well as to browse through and add new promotions to their existing service packages.

We expect that these four trends will influence CSPs’ strategies across the globe, especially in markets where competition is strong and where service differentiation is crucial to continuously drive CSPs’ bottom line.