By Salman Tariq, VP Sales Middle East and Africa • March 17, 2021
I recall my conversation with an African telecom CTO a few years ago. There was a mounting situation that was causing a snowball of complaints at their call centers. Some of their customers were not able to fully utilize the last remaining 20 bytes of their data bundles before switching to another wallet account. It was not like this allocation had disappeared; it was there to be consumed next time. However, the telecom operator had to make refunds to manage the situation.
These were only a handful of customers, and we were talking about less than 1 cent (USD) of exposure in most cases. But the CTO explained to me that 20 bytes of data mean the ability to send a few WhatsApp messages, which is a tangible value for this segment of the market. The telecom operator would happily credit back to these customers; however, they could not afford to service the problem with an expensive call to the CSR agents, costing multiple times more and, most importantly, losing customer trust. The tier 1 operator eventually invested in an innovative solution for their BSS platforms to solve this seemingly trivial but critical business problem.
This year marks my twentieth anniversary in telecoms. I have spent most of the last decade working with operators across developing markets in the Middle East and Africa on OSS/BSS solutions. While the prospects of 5G enterprise opportunities are exciting for the industry, most developing markets are still looking to solve some fundamental problems. There is a dire need for innovative approaches to gain and retain customer trust with a large market segment that is extremely cost-conscious, has low ARPU, and does their telco purchasing on a daily basis.
Monetization and BSS platforms play a pivotal role in solving that problem. While most OSS/BSS players are focusing investments into 5G and IoT, this will not become mainstream in these markets for a few years. The innovation required to help these developing markets solve their most pressing problems today and ensure an excellent customer experience is largely not addressed.
With limited disposable income, consumer trust and revenue predictability are intimately connected for these markets. Most of their customers buy their telco connectivity as daily bundles, weighing in against choices like going out for a coffee on the street with a friend or saving up to repair that broken refrigerator. While it is given that they will pick and choose the most economical plan and would not shy away from switching to another provider for a minor cost difference, additionally they want full transparency for every cent they spend and every byte they consume.
BSS platforms sit at the core of that issue and are expected to notify customers in a manner they can understand — demystify the complex products and promotions hierarchy into a comprehensible value, alert customers before they are expected to run out, recommend the best top-up option to continue uninterrupted — and do it while understanding the behavior and preferences of each individual. To make this problem even more challenging, smartphones enabled by 3G and 4G technologies continue to use a lot of background data, which most consumers do not easily comprehend, and they put the onus of end-to-end transparency on their telco provider. If there is a perceived notion that my provider is “stealing” my money, this segment will not only stop purchasing, but it could also potentially cause significant reputational damage.
Since economic conditions in most of these developing markets are not expected to improve significantly, the challenge to convert the daily purchases to more long-term predictable products is expected to remain. One of the ways to drive more revenue predictability would be to capitalize on the short upsell windows. BSS platforms carry the most relevant contextual data of these customers, and they need to have the ability to detect and act on those upsell opportunities in real time. The close interaction between customer value management (CVM) and real-time monetization platforms is the key to enable deep, personalized engagement across multiple channels and have the best chances of converting the upsell opportunity to revenue.
Tariff innovation is still a core differentiation strategy for these highly competitive markets. Most successful tariff plans aim to create a perception of “more for less” by packaging freebies to stimulate usage and attempt to capture specific niches. Community tariffs and shared allowances play a key role in this approach. This demands BSS systems be able to create complex abstract customer hierarchies, share common buckets across larger communities, and offer a seamless administration experience to build cost control confidence.
Another potential strategy to explore for these markets is dynamic surge pricing — the ability to vary price plans dynamically in real-time within BSS platforms based on demand patterns and incentivizing early buyers. These strategies have worked well for certain industries, including airlines and hospitality. While it might look interesting, it does not come without the risk of cannibalizing revenues of a segment that is willing to pay a higher price today.
Most telecom operators did not venture deep into this till now, weighing the risks of revenue decline against the fixed Opex model that most telcos operate today. However, with improved access to powerful cloud-based AI and ML tools and the persistent challenge of converting an unpredictable demand to predictable revenue, it just might be the right time to experiment.
With a high youth population in most developing markets, demand expectation is unpredictable and changes constantly. These customers would easily get influenced by a new advertisement or a friend’s social media referral post. This adds the challenge for the telco to be able to change and react much faster and in the most non-intrusive manner. Low margins coupled with the need to adapt frequently, require that such changes are done right the first time. Cloud-native technologies in BSS would help alleviate this problem by bringing automation, offering the ability to configure and roll out new microservices services without risking current services, and to a larger extent, eliminating human skill set intervention in a largely manual software change management process.
At Optiva, we focus our innovation on building a future-ready platform while also ensuring that we work closely with our customers to understand and solve their challenges today. We harness cloud-native technology, a rich library of market-relevant capabilities, and operational models built to enable zero-touch operations to help CSPs in emerging markets win the trust, and eventually, the wallet of their customers.
Discover more. Read The Digital Telco: Engineering a Winning Customer Experience.