Clients regularly ask Kester Mann, Director, Consumer and Connectivity, at CCS Insight, “How can operators build on their stellar efforts during the Covid-19 crisis?” Here are some of his suggestions.
The telecom sector has enjoyed a welcome boost to its reputation this year as the health crisis has clearly shown the value that businesses and consumers place on high-quality connectivity. In many of my recent conversations with network operators, I’ve heard about improving loyalty and higher customer satisfaction. Operators’ brands may never be the most loved, but it seems they’re at least getting a little more appreciation.
Five months into lockdown, CCS Insight surveyed more than 2,000 people across the UK and US about how they view their telecoms provider and whether the pandemic may influence future buying decisions.
Telecom companies sometimes get a bad press, so it was heartening that nearly nine out of ten mobile customers said they were either “very satisfied” or “fairly satisfied” with their service provider. Of course, this satisfaction was achieved despite soaring and often unpredictable recent demand.
Usage into revenue
The challenge for the telecom industry has long been how to turn usage into revenue. I believe there are clear opportunities for providers that are prepared to move quickly or think a little differently. During lockdown, some operators temporarily upgraded people’s tariffs, for example offering free content or faster download speeds. Can they now use this goodwill to encourage people to sign up to these services more permanently?
About one out of seven respondents said they would be happy to spend more on their home broadband package in return for a better service. This sounds like welcome news for premium providers, which could seek to lure customers from rival networks with an emphasis on network quality. Another 13% of respondents expect to upgrade their mobile tariff in the coming year.
Work from home
Dedicated work-from-home packages are also worth talking about. Deutsche Telekom has recently launched a concept called Magenta Business Home Office, which bundles hardware, connectivity, collaboration tools, security and consulting, and support. I expect to see a flurry of similar offers land over the coming weeks.
Also, according to the CCS Insight’s research, nearly one in three people plan to buy a new mobile phone within the next 12 months and about one in five expects to invest in a new laptop or home computer. More than 10% reckon they’ll spend more on online subscription services.
Clearly, there are opportunities to go after, but let’s not be lulled into thinking that tough economic conditions won’t become a significant drag on people’s budgets for technology and connectivity. Yes, some people will emerge from the pandemic better off, and more able and prepared to spend more, but countless others won’t have that luxury.
It’s one of the reasons CCS Insight expects total mobile phone sales in the UK to have plunged 15% during 2020, to its lowest volume for a decade.
Despite continued roll-out of 5G networks, the pandemic appears to have numbed some interest in the technology among consumers. More people in our survey this year said they “don’t need 5G” compared to 12 months ago. This is likely due to Covid-19 restrictions making the reasons for taking 5G less apparent, but it also serves as a warning to the industry that it must do more to help people understand how the technology can help them.
In some ways, Covid-19 resets the competitive landscape and I believe it opens both new opportunities and challenges in the consumer market. Operators surprised with their impressive levels of agility during the pandemic; those that continue to act quickly and think differently will probably be the most successful.