According to data from Nielsen, average smartphone data usage grew from 230 MB/month in the first quarter of 2010 to 435 MB/month in the first quarter of 2011. At 89%, this dramatic growth is raising many questions for CSPs: how to make this growth profitable, whether and how to introduce usage-based data plans, and whether or not to throttle their customers, to list just a few.
There is a home truth here that our industry needs to face: All users are not the same. Identifying, extracting and utilizing the insight about each one of them – how they use the network and their services – is key to raising the service level for everyone and in turn driving loyalty and profit.
As a general rule, customers expect more for less, but what happens when one customer is an ‘extreme user’, but pays only pennies? Financial pain for the CSP, a negative impact on the experience of other profitable data users and if the user happens to be charged for the data, massive billshock.
If the removal of 1 unprofitable user makes way for as many as 25 profitable users, the stakes here are very high. Gaining insight about data usage and the customer behaviors and preferences behind the usage patterns is crucial. Using this insight to design the right propositions for the right customer segments makes all the difference.
Are customers price sensitive? Are they quality sensitive? What incentives work with them? Which customers should be offered WiFi offload? Which customers are premium customers? With the answers to these questions, CSPs have effective tools for reducing their CAPEX demands from usage spikes, optimizing their busy hour traffic, growing their data revenues and maximizing their profits.
This post is by Jeremy Brown from Customer Experience Consulting.
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