Telesperience Customer Experience Benchmark 2013, part of the Benchmarking Series

The evolving role of social media in the telecoms customer experience

Teresa Cottam, Chief Strategist

Telesperience Benchmark: The Evolving Role of Social Media in the Telecoms Customer Experience

TABLE OF CONTENTS
Sponsors Message .............................................................................................................................................. 3 1 2 3 4 5 6 7 8 9 10 The telecoms customer experience................................................................................................................ 4 How important is the customer experience to CSPs? .................................................................................... 5 How CSPs rate the customer experience they provide .................................................................................. 7 What are CSPs top three customer experience goals?.................................................................................. 8 Who is driving social media adoption and usage?.......................................................................................... 9 What are CSPs using social media for? ....................................................................................................... 10 Investment patterns...................................................................................................................................... 13 How CSPs assess social success................................................................................................................ 15 Summary ...................................................................................................................................................... 16 Research Methodology................................................................................................................................. 17

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Sponsors Message
The telecommunications industry is arguably one of the fiercest consumer markets we know. The pace of innovation in telecom runs at breakneck speed and will only always accelerate. Providers are left with delivering services that commoditize practically as soon as they launchlaunch to a particularly critical and demanding audience, quick to take their SIM cards and go elsewhere if disappointed. Increasingly, telecom service providers have faced these challenges by turning to the customer experience as a point of differentiation. And as todays consumers become more and more social, they now look to social media to deliver the type of differentiated experiences that translate to long-term customer loyalty. Yet social media remains a new and complex landscape. Many operators still have big question marks around the social customer experienceeverything from what is it to who should own it to how should we measure success. The constantly emerging nature of social media challenges all business today to sift through the cacophony of channels, technologies and use cases to emerge with a sustaining investment strategy that really sings. In our book, a social media investment strategy that really sings is one that makes a bottom-line difference. As telecoms look to the social customer experience for competitive advantage, its critical that they develop a better understanding of exactly how investments in social media can bring them closer to their customer experience goalsand impact the bottom line. We set out to benchmark the telecom social customer experience in 2013 in order to better guide todays service providers toward strategies that make sense. We asked over 40 global telecoms about their social customer experience goals, investments, strategies, offerings, and results. We found that delivering exceptional customer experiences in telecom is top of mind and getting more difficult. Just 5% of telecoms today think their CXP is excellentdown from 8% just two years ago. But we also found that deeper investments in social lead to more CXP confidence. Telecoms who use social to transform the customer experience, who invest in on-domain social platforms are more apt to rate their overall CXP as good and less apt rate it average. In general, we found social media technology adoption in the telecom industry to be strong and growing fast. We found that those who are serious about socialhave owned social platforms, robust social customer engagement and enlistment strategies, and involve more of the business in the social customer experienceget serious results. These more socially mature telecoms enjoy significantly greater reduction in call center volume and support costs. While there did emerge clear market leaders who are now leveraging the full power of social across the entire business, we found that the industry has some growing to do. There remains quite a bit of opportunity for social media investment expansion in certain geographiesparticularly APAC, and certain use casesparticularly social support. As the market continues to mature, the detailed findings in this benchmark study should help telecom service providers make better social media investment decisions and better measure their success.

Rob Tarkoff CEO - Lithium Technologies

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Telesperience Benchmark: The Evolving Role of Social Media in the Telecoms Customer Experience

Telesperience Customer Experience Benchmark 2013: The evolving role of social media in the telecoms customer experience
February 2013

1 The telecoms customer experience

Competition continues to increase in the telecoms market, while core services are commoditising, meaning that the customer experience has come to the fore as a means and arguably for some communications service providers (CSPs) the single, most important means of differentiating their offering and increasing their competitiveness. In recent years not only has there been a much greater emphasis placed upon optimising the experience thats provided to telecoms customers, but considerable discussion about the need for CSPs to become less technology-centric businesses and more customer-centric. Undoubtedly there is considerable variation in how well individual CSPs are performing in terms of meeting the needs of their customers, and in how fast they are becoming more customer centric. The re-engineering of telecoms operators into customer-centric service providers has not always been an easy transition for CSPs to make, and its one thats being made in the face of vociferous commentary and criticism from both the media and customers, whose expectations have evolved faster than some CSPs offerings. However, progress is being made globally and best practice from both within the telecoms industry as well as from outside it can be leveraged to improve performance. One major change is the adoption of social technology. When Telesperience measured CSPs performance in 2010 with regards to the customer experience they delivered, many CSPs said they were planning on employing social media and social CRM platforms to create a more personalised and supportive experience for customers. Those plans have now come to fruition and social media technology is widely deployed within the industry. The question now is whether CSPs are fully exploiting the capabilities of social technology and embracing the possibilities it offers for their businesses. Social technology is no longer being used solely for interacting with customers, but is helping create new ways of doing business and new opportunities for CSPs. As social technology extends outside the CRM domain, its important to understand how different CSPs are using it and what they intend to use it for in future. To do this, Telesperience has conducted primary research amongst CSPs worldwide of different types and sizes. In this report we present the findings of this study, which reveals how CSPs think theyre performing with regards to the customer experience and their use of social techniques, what theyre using it for and, importantly, what they plan to use it for. This study acts as an industry benchmark for CSPs, providing in-depth insight for them to use to judge their own performance against. Seven key findings include: The customer experience will grow in importance to CSPs businesses from 8.20/10.00 today to 9.39/10.00 by 2013 (see Figure 1) Only 5% of CSPs believe they provide an excellent customer experience today (see Figure 4) Increasing customer loyalty is the number 1 goal for CSPs in 2013 (see Figure 6) The marketing department is the main driver for social technology adoption in telecoms service providers (see Figure 8) 93% of CSPs are now connecting with their customers through social networks (see Figure 10) 15% of CSPs have brought customer-sourced innovation to market, and 12% have already derived revenues from their customers suggestions (see Figure 15) 95% of CSPs are either maintaining or increasing their budgets for social media in 2013 (see Figure 17)

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2 How important is the customer experience to CSPs?

The operators in our study rate the experience they provide to their customers as very important to their business (8.20/10.00) but believe it will be even more important to their business by 2015 (9.39). Whats interesting is that when we correlated these findings against how CSPs rated the customer experience in 2010, we discovered that the current importance placed on the customer experience was almost identical to that placed on it in 2010 (8.30). And likewise, in 2010 operators also thought that the customer experience would increase in importance by 2013 expecting its importance to the business to be 9.25.
Figure 1 Comparison of how valuable CSPs think the customer experience is to their business (2010 and 2013)
7.50 2010: average importance 8.00 8.50 8.30 9.00 9.50

2013: average importance

8.20

2010: expected importance by 2013

9.25

2013: expected importance by 2015

9.39

Source: Telesperience studies 2010 and 2013 In both studies CSPs were asked to rate the importance of the customer experience to their current and future business on a scale of 1-10

Comparing the results from these two studies shows that CSPs consistently believe the customer experience will increase in importance to their future business. The findings also suggest that CSPs are still not fully leveraging the value of the customer experience to their businesses, because they are not yet realising the increased value they anticipated in 2010 now expecting this value to be realised around 2015 (that is, in the future). Whats also notable from Figure 1 is that in 2013 CSPs rate the value of the customer experience to their business marginally lower than they did in 2010, but they believe its value to their future business will be greater than they anticipated in 2010. In 2010 and 2013 CSPs rated the importance of the customer experience to their businesses as being roughly the same (8.30 in 2010 and 8.20 in 2013). In both studies they believed the customer experience would increase in importance to their business (9.25 in 2010 and 9.39 in 2013). In 2013 CSPs have not realised the level of importance they anticipated back in 2010 (rating it 8.20 in 2013 as opposed to anticipating in 2010 it would be 9.25 by 2013). In 2010 CSPs rated the future importance of a great customer experience to their business as 9.25; they now rate it as being worth 9.39 by 2015.

However, there is considerable regional variation in terms of how CSPs rate the customer experiences importance to their business both now and in 2015 as shown in Figure 2. The customer experience is seen as most important to their business by European CSPs who rated it 8.77 in 2013 and anticipated it would grow in importance to 9.92 by 2015. This reflects the high level of competition in the European market and thus the requirement to differentiate their offering from that of rivals. The customer experience is least important to APAC operators who rated it 7.78 in 2013. However, they perceive that its importance to their business will grow rapidly in the next few years, and by 2015 rate importance at 9.11 closing the gap substantially between APAC and other world regions. This reflects the maturation of some of the high-growth APAC markets where exponential growth and an emphasis on maximising market share is now giving way to the requirement to retain the highest ARPU customers as the market shifts to an emphasis on revenue maximisation from each subscriber and loyalty.

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Telesperience Benchmark: The Evolving Role of Social Media in the Telecoms Customer Experience

North America rates the customer experience as being more important to their business in both 2013 and 2015 than Asian CSPs, but does not place as much importance on it as European CSPs do. This reflects a hybrid positioning where there is relatively less competition in large parts of North America than in Europe, but a growing recognition that maintaining ARPUs requires CSPs to focus on customer retention and loyalty.

As might be expected, all three regions show an increase in the perceived importance of the customer experience to the CSP business by 2015 (see Figure 3).
Figure 2 How valuable CSPs think the customer experience is to their business (2013), regional breakdown

Europe

8.77

North America

8.55

Global

8.20

APAC

7.78

Source: Telesperience 2013

Figure 3 How valuable CSPs think the customer experience will be to their business by 2015, regional breakdown

Europe

9.92

North America

9.73

Global

9.39

APAC

9.11

Source: Telesperience 2013

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3 How CSPs rate the customer experience they provide

Despite the importance that CSPs place upon the customer experience (see Figure 1) very few regard themselves as providing an excellent customer experience in 2013 (5%). In fact, as can be seen in Figure 4, the proportion of CSPs that regard themselves as providing an excellent customer experience has dropped marginally since Telesperiences 2010 study (when it was 8%). Likewise the number of CSPs rating themselves as providing a good customer experience has fallen from 63% in 2010 to 54% in 2013. However, those rating themselves as providing an average experience has risen from 21% in 2010 to 39% in 2013. Fortunately, those now rating themselves as providing a below average experience has fallen from 8% to 2%. This reveals that the worst performing CSPs believe they are improving, but the number of CSPs who believe they provide an outstanding customer experience has fallen. This finding reflects the fact that the customer experience continually evolves and commoditises. There is thus strong pressure towards a customer experience norm, which means what was once an excellent or good customer experience will rapidly become an average experience as more companies are able to provide that type of experience. In order for a CSP to continue to provide an outstanding experience its therefore necessary for them to continually innovate to remain ahead of their rivals and provide a truly exceptional and differentiating customer experience. Given the high value that CSPs place on the future customer experience, the clear message is that they need to invest now in order to deliver against their goals and realise the expected business value by 2015.
Figure 4 Comparison of how CSPs rate the customer experience they provide (2010 and 2013)

8% Excellent 5%

63% Good 54%

21% Average 39%

8% Below average 2%

2010

2013

Source: Telesperience studies 2010 and 2013. In both studies CSPs were asked to rate themselves as providing either an excellent, good, average or below average customer experience

Again, a geographical analysis reveals distinct regional patterns as to how CSPs think theyre performing with regards to the customer experience (see Figure 5). Asian operators are most likely to be confident they are providing an excellent customer experience, but this is also the region with the most low-performing operators. European operators generally believe they provide either an average or good experience, but 8% believe theyre delivering an excellent experience. None think they provide a below average experience. North American operators believe they deliver either an average or good experience, but none rate themselves as providing an excellent experience or a below average experience.

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Telesperience Benchmark: The Evolving Role of Social Media in the Telecoms Customer Experience

Figure 5 How CSPs rate the customer experience they provide (2013), regional breakdown
Global Excellent Good Average Below average 5% 54% 39% 2% Europe 8% 46% 46% 0% Source: Telesperience 2013 APAC 11% 44% 33% 11% North America 0% 64% 36% 0%

4 What are CSPs top three customer experience goals?

Telesperience asked CSPs what their top three customer experience goals were. As can be seen from Figure 6, overall these were (1) Increase customer loyalty (2) Right-first-time customer service (3) Cost-effective self-service.
Figure 6 Top three customer experience goals 2013

Increase customer loyalty

76%

Right-first-time customer service

54%

Cost-effective self-service

51%

Improved brand perception

41%

Reduce customer complaints

39%

Increase ARPU

37%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Source: Telesperience 2013 CSPs were asked to indicate their top three customer experience goals

Both the second placed and third placed goals (right-first-time customer service and cost-effective self-service) have strong operational efficiency that is cost reducing elements to them. And increasing customer loyalty could be viewed as another cost-saving strategy, since recruiting new customers is usually more expensive than retaining existing ones. Its surprising that given the level of competition and flattening revenues in many markets (as basic services commoditise), which both put increasing pressure on the revenue ceiling, more emphasis is not being placed on increasing ARPU.

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A geographical analysis reveals some differences in CSP goals however (see Figure 7). Europe follows the global norm for the top two goals, but its third most important goals is reducing customer complaints. This possibly reflects having to manage the effects of new network rollouts, network congestion, and confusion around data tariffing as Europe moves away from flat rate pricing. North America shares the same goals as the global norm but shuffles the importance slightly seeing costeffective self-service as being more important than right first time self-service. This shows a focus on reducing costs more than on maintaining customer satisfaction. However, North American operators are cautioned that when self-service doesnt work first time, it will generate additional or hidden costs in the form of dissatisfaction, complaints and possibly even churn. APAC shares the global concern with increasing customer loyalty but sees increasing ARPU as more important. Unlike other regions it also rates improved brand perception within its top three goals. This reflects the fact that many high-growth APAC markets have relatively low ARPUs, and as the next billion customers are added it is creating a downward pressure on ARPU. In more developed APAC markets the effects of competition and commoditisation likewise create a downward pressure on ARPU similar to that seen in Europe. A focus on maintaining or increasing ARPU is therefore a key concern in this region.

Figure 7 Top three customer experience goals 2013 by region

Global Europe Increase customer loyalty Right-first-time customer service Reducing customer complaints APAC Increase ARPU North America Increase customer loyalty Cost-effective selfservice Right-first-time customer service

1 2 3

Increase customer loyalty Right-first-time customer service Cost-effective selfservice

Increase customer loyalty Improved brand perception

Source: Telesperience 2013

5 Who is driving social media adoption and usage?

In most CSPs a mixture of the marketing department and the CRM department are the primary drivers in social media strategy. However, a wide range of other players influence decisions made about social technology (see Figure 8). Figure 8 Primary drivers and key influencers of social media adoption and usage
Marketing 76% 24%

Customer care

41%

59%

Other

10%

17%

IT

5%

61%

Sales

5%

66%

R&D 2%

32%

Primary Driver

Influences

Source: Telesperience 2013

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Telesperience Benchmark: The Evolving Role of Social Media in the Telecoms Customer Experience

In 8 out of 10 CSPs the marketing department is the primary driver for social media strategy. While customer care is either the primary driver of social technology adoption and usage (in 4 out of 10 CSPs) or is an important secondary influencer (in 6 out of 10 CSPs). Other key departments such as IT and Sales are highly influential on the decision-making process. Figure 9 shows that in North America IT is consulted in every single case, but in Europe it is only consulted in 38% of CSPs. Likewise in 82% of CSPs in North America the Sales department influences decisions, but only in 54% of European and 56% of APAC CSPs is Sales consulted. This is surprising given the focus APAC has on raising ARPU. Figure 9 Primary drivers and key influencers of social media adoption and usage, regional differences
Europe Main driver(s) Marketing (85%) Customer care (54%) Sales (54%) Customer care (46%) IT (38%) APAC Marketing (89%) North America Marketing (64%) Customer care (36%) IT (100%) Sales (82%) Customer care (64%)

Chief influencers

Customer care (89%) Sales (56%) IT (56%) Source: Telesperience 2013

6 What are CSPs using social media for?

Using social technology and approaches is now the norm in the telecoms industry. Ninety-three per cent of the CSPs we spoke to said they are already using social media to connect with their customers. However, the secondmost common use today of social technology is to drive business impact, which shows a maturation in thinking and goals. By 2015, 9 out of 10 CSPs say they will be using social technology to drive business impact, and 8 out of 10 say they will be using it to drive conversion and to transform the customer experience (see Figure 10).
Figure 10 How CSPs are using social technology (2013)

Connecting with customers through social networks

93%

Driving business impact

61%

27%

Driving conversion through owned social hubs

56%

20%

Transforming the customer experience

44%

37%

Using

Plan to use

Source: Telesperience 2013

As can be seen in Figure 11, in general North America is ahead in terms of its use of social media; however in these four areas the highest growth will be seen in Europe. Europe will be concentrating on utilising the technology to drive business impact (+62%) and to transform the customer experience (+38%). The biggest growth in usage in APAC will be to improve the customer experience (+33%) and to drive conversion (+22%). In North America, which is relatively mature in its use of social technology, the biggest growth areas will be in utilising it to drive conversion (+27%) and to drive business impact (+18%).

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By 2015 most CSPs will be using social technology to deliver against all four of these goals, demonstrating a rapid evolution of usage and commoditisation of capabilities. This indicates that what is considered cutting edge today will be mainstream tomorrow, but it raises two other issues that need to be considered:

there needs to be continual innovation to remain ahead of the competition. CSPs cannot just implement social technology and expect to gain the maximum benefit from it. They need to embrace what it delivers as an integral part of the way they do business, since to maximise the value requires CSPs to really focus on their customers and not just on their networks.

Figure 11 How CSPs are using social technology, regional differences

Connecting with customers Driving business impact Driving conversion Transforming customer experience 44% 81%

Global usage 2013 Global usage by 2015 Most advanced region 2013 Most advanced region by 2015 Highest growth region (increase)

93% 93%

61% 88%

56% 76%

North America

North America

North America

North America

North America

Europe

North America

North America

None

Europe 62 percentage points Mature 33 percentage points Source: Telesperience 2013

North America 27 percentage points Mainstream 13 percentage points

Europe 38 percentage points Mature 16 percentage points

Status by 2015 Difference between most/ least advanced regions by 2015

Commoditised 22 percentage points

To find out more about how CSPs are using social media to engage with and enable customers, Telesperience asked CSPs to tell us how they were engaging with their customers. Overall there were four main motivations for engaging with customers (see Figure 12): Loyalty using social technology to engage with loyal customers was the most common use of the technology today and by 2015 83% of CSPs will be doing this Innovation customer-centric innovation (that is, gleaning ideas and suggestions from customers) was the second most common way in which CSPs were utilising social technology for customer engagement today. By 2015 this will be the most common usage with 86% of CSPs doing this Operational around 44% are enabling existing customers to support other customers and by 2015 64% of CSPs will be doing this Commercial the least common way of using social technology to engage with customers today was to support commercial goals. Today only 27% of CSPs are able to engage existing customers to provide new customers with purchasing advice, although this is set to rise to 59% by 2015.

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Telesperience Benchmark: The Evolving Role of Social Media in the Telecoms Customer Experience

Figure 12 How CSPs are engaging and enabling customers using social technology

Engaging with loyal customers

68%

15%

Enlisting customers to share ideas

59%

27%

Enlisting customers to support other customers

44%

20%

Enlisting customers to give purchase advice

27%

32%

Doing

Plan to do

Source: Telesperience 2013

In these four aspects of social engagement North America had less of a clear lead over other regions than we saw when we measured uses of social media. Today North America is more mature in its usage of enlisting customers to share ideas and support other customers; but Europe is ahead in engaging loyal customers and enlisting customers to give purchase advice. By 2015 North America will have passed Europe in its usage of engaging loyal customers. However, APAC will be the most mature market in terms of enlisting customers to give purchasing advice. Relatively low growth in Europe in comparison to the other regions will see it slip back to third position in every category except engaging loyal customers
Figure 13 How CSPs are engaging and enabling customers using social technology, regional differences
Engage loyal customers Enlist customers to share ideas Enlist customers to support other customers 44% Enlist customers to give purchase advice 27%

Average global usage 2013 Average global usage by 2015 Most advanced region 2013 Most advanced region by 2015 Highest growth region

68%

59%

83%

85%

63%

59%

Europe

North America

North America

Europe

North America North America 45 percentage points Mature

North America APAC 44 percentage points Mature

North America APAC 22 percentage points Mainstream

APAC North America 45 percentage points* Mainstream

Status by 2015

Difference between most/ least advanced regions by 2015

15 percentage points

14 percentage points

37 percentage points

13 percentage points

Source: Telesperience 2013 * in this category APAC is only 1 percentage point behind NAR in terms of growth

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The patterns of growth shown in Figure 13 will result in maturation of some of these areas by 2015. As shown in Figure 14, sharing customer ideas will be a commodity engagement by 2015 in APAC and North America, as by then 9 out of 10 CSPs will be able to do this and thus it will no longer be a differentiator but just an accepted part of business-as-usual. Engaging loyal customers will be reaching maturing in Europe and North America, as it still offers some differentiation, although the vast majority of operators will be able to do it. It is the growing areas of engagement (supporting other customers in Europe and APAC, and giving purchasing advice in Europe and North America) that will offer most competitive advantage. At this stage in the market only half the CSPs are able to deliver the business benefits from these types of engagement, and so they offer points of differentiation both in terms of the customer experience delivered and commercially. However, as use cases reach maturity, the emphasis shifts from novelty and simply being able to support or deliver something, to delivering it in a way that drives business benefit.
Figure 14 Relative maturity of each region in terms of customer engagement 2015
Criteria Sharing ideas Engaging loyal customers Supporting other customers Giving purchasing advice Europe 77% 77% 54% 54% APAC 89% 67% 56% 67% North America 91% 82% 91% 55%

Source: Telesperience 2013 Key: = Growing = Mainstream = Mature = Commodity

The first of these criteria sharing ideas has the potential to offer enormous competitive advantage. CSPs who are able to utilise customer ideas can lower the cost of innovation whilst also increasing the volume and velocity of innovation through crowdsourcing techniques. Importantly, the ideas derived may also have a higher likelihood of being successful, since they were suggested by customers to meet real needs and wants. The commercial potential offered by customer-derived innovation is such that we were prompted to ask CSPs how they thought they were performing in this area. As can be seen from Figure 15, the most popular way of uncovering customer ideas is to use forums, with 63% of CSPs doing that today. However, almost one-third of CSPs (29%) admitted that they still do not solicit ideas from their customers putting them at a commercial disadvantage to those that can do this.
Figure 15 How CSPs are using customer-sourced innovation (2013)
Forums etc uncover product ideas

63%

We dont solicit product ideas

29%

Crowdsourced innovation driver of competitive advantage

22%

Customer suggested product ideas to market

15%

Incremental revenue from customer suggestions

12%

Source: Telesperience 2013

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Telesperience Benchmark: The Evolving Role of Social Media in the Telecoms Customer Experience

Figure 16 also shows that the most advanced CSPs around 1 in 10 have already been able to utilise customersourced ideas not just to launch products, but also to derive revenues from these suggestions. This is an area where Europe is leading the rest of the world currently, but where CSPs in APAC with its strong focus on raising ARPU could benefit from focusing more effort.
Figure 16 CSPs who are able to utilise customer-sourced innovation
Global Customer suggested ideas to market Revenues from customer suggested ideas Europe APAC North America

15%

23%

0%

9%

12%

23%

0%

9%

Source: Telesperience 2013

7 Investment patterns
Social media is one of the key technologies that CSPs plan to invest in. Eighty per cent of the CSPs in this study intended to increase spending on social media between 2013 and 2015, and 95% are either increasing or holding spending at the same level (see Figure 17). Related areas such as customer loyalty are also a priority for investment, with 95% of CSPs maintaining or increasing spending. Some areas fare less well with call centres and SEO experiencing a drop in spending in around 1 in 10 CSPs.
Figure 17 Investment areas for CSPs 2013-15

Customer loyalty

85%

10%

2%

Social media

80%

15%

2%

eCommerce

66%

27%

2%

Self-service through owned social hubs

63%

24%

2%

Call center

53%

34%

12%

SEO

39%

34%

10%

Word-of-mouth marketing

37%

54%

4%

Increase

Stay same

Decrease

Source: Telesperience 2013

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Beneath the global pattern of investment there are also distinct regional variations in terms of systems spending, as can be seen in Figure 18. The areas that will see increases in investment are identical in Europe and North America, although a higher proportion of CSPs will increase their spending in these areas in North America than in Europe. In APAC, CSPs intend to increase spending on loyalty reflecting the requirement in this market to retain more high ARPU customers. The increase in spending in e-commerce also reflects this regions interest in raising ARPU. In all three regions some CSPs intend to decrease investment in call centres reflecting a change of strategy from dealing reactively with enquiries and complaints, to being more proactive in handling these or using alternative methods such as enabling customers to support other customers (see Section 5). In all three regions some CSPs intend to reduce spending in SEO as well, perhaps indicating that they are moving to a social engagement model rather than spending their budget on search to enable customers to find them.
Figure 18 Investment areas for CSPs, regional breakdown
Europe APAC North America

1 2 3 3 2 1

Social media (77%)

Customer loyalty (88%)

Social media (82%)

Customer loyalty (76%)

E-commerce (78%)

Customer loyalty (82%)

Self-service through social hubs (54%) E-Commerce (8%)

Social media (66%)

Self-service through social hubs (72%) Word of mouth marketing (18%) SEO (18%)

N/A

SEO (8%)

SEO (11%)

Call Centre (8%)

Call Centre (11%)

Call Centre (18%)

Source: Telesperience 2013

8 How CSPs assess social success

Globally the most common measure used to judge whether social initiatives are successful is customer satisfaction ratings such as C-Sat scores (see Figure 19). However, this is being combined with a number of other measures including metrics from popular social networking sites. More sophisticated measures that require initiatives to be linked to performance in other areas are less commonly used today, but we would expect these to grow in importance as CSPs begin to use social technology for purposes other than simply connecting with customers. However, it can be challenging for CSPs to track cause and effect in order to judge social media performance, due to their complex and siloed IT infrastructure and departmentalisation. Somewhat surprisingly, nearly 2 out of 10 CSPs are not using any measures to judge whether social initiatives are successful and this holds true across all three regions. As can be seen from Figure 20, in APAC and North America sales revenues attributed to social channels are one of the measures being used to judge performance this is consistent with APACs focus on increased ARPU. However, in Europe deflected support cases are being used more commonly as a measure of success, which reflects this regions need to reduce operational costs. Only about 3 out of 10 CSPs in Europe use sales attributed to social channels as a measure of success, but although this trails behind the proportion in APAC and North America using this measure, it is not substantially removed from it. Telesperience believes the way social success is being measured also reflects a maturation process in the use of social technology. Initially it has been used for engaging with customers (that is, communication) and thus C-Sat scores and social media metrics are adequate measures of success. But as use of social technology becomes more complex and is used for more sophisticated social engagements, the measures used to judge success likewise have to expand

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Telesperience Benchmark: The Evolving Role of Social Media in the Telecoms Customer Experience

and become more sophisticated. In the most mature CSPs social technology becomes an essential part of product innovation and sales success (that is, revenue maximisation), and thus sales performance data becomes increasingly important.
Figure 19 Method CSPs use to measure social success

Customer satisfaction Metrics from popular social networks Number of support cases deflected by social media Sales revenue attributed to social channels SEO rankings for branded community pages We don't measure it 17% 24% 37% 41%

63%

63%

Source: Telesperience 2013

Figure 20 Method CSPs use to measure social success, regional differences

Europe APAC North America

1 2 3
Percentage that dont use any measures

C-Sat (54%)

C-Sat (89%)

Metrics from social networks (64%) C-Sat (45%)

Metrics from social networks (54%) Deflected support cases (54%)

Metrics from social networks (56%) Sales revenues (44%)

Sales revenues (36%)

23%

22%

18%

Source: Telesperience 2013

9 Summary
Social media provides a new channel for CSPs to interact with their customers. However, taken to its natural conclusion it also supports, in achievable steps, the necessary fundamental change to the telecoms business model and processes that the industry has long talked about delivering. This is because it enables the CSP to focus what it does around the needs of the customer by better engaging with customers; it can glean insights, suggestions and complaints from customers which it can use to improve its performance; and it can leverage a loyal customer base to become better at selling more of what the customer wants, in a way the customer wants it. CSPs cannot just implement social technology and expect to gain the maximum benefit from it. They need to embrace what it delivers as an integral part of the way they do business, since maximising the value requires CSPs to really focus on their customers and not just on their networks delivering true customer-centricity. Social technology itself is showing rapid evolution from providing operational efficiency to being an integral building block in a different type of customer experience and an enabler of future commercial success. Importantly, CSPs should note that social technology is not just important for the B2C side of the business, but also to engage with enterprise customers and SMEs.

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10 Research methodology
This research programme uses a technique which is sometimes called the expert panel or expert sample. In other words we sought to locate a relatively small number of highly qualified and senior staff who had the knowledge and experience to answer the questions we were researching, and who could also represent the views of their peers. The research was focused on delivering a picture of the current status of social technology adoption within the global CSP market, as well as future goals and investment plans. Thus we sought to locate and speak to those staff within CSPs who are currently responsible for supporting, or who substantially influence, the companys social technology or social CRM strategy. The trends shown here are based on a global sample, with regional breakdowns provided where indicated. In this programme we spoke to 41 senior managers (CXO, VP and Director level staff) from communications service providers worldwide. Figure 21 provides a breakdown of the operators represented in this sample by size of subscriber base and by region of operation. It should be noted that some of the smaller CSPs in this sample were parts of larger groups. In terms of operator type, 44% were multi-service operators (MSOs), 32% were mobile/wireless providers, 20% were fixed/wireline/fiber providers, and the remaining 4% MVNOs and WiMaX operators.
Figure 21 Regions and size of CSPs in research sample

CALA 10% MEA 10%

Europe 32%

More than 20 million 27% Up to 5 million 39%

Total sample: 41 CSPs

APAC 22%

Total sample: 41 CSPs

10 to 20 million 15%

North America 27%

5 to 10 million 19%

Source: Telesperience 2013

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Telesperience Benchmark: The Evolving Role of Social Media in the Telecoms Customer Experience

About the author

Teresa Cottam is the Founder and Chief Strategist at Telesperience, an independent telecoms industry analyst firm. She has more than 19 years experience in the industry and was previously an Associate Principal Analyst with UKbased telecoms consultancy Analysys Mason. Before that she headed up Research and Publications at Chorleywood Consulting, a specialist BSSOSS consultancy which was acquired by Informa Telecoms and Media. Prior to this she was Managing Editor at industry analysts Ovum. Teresa has authored numerous influential reports and trends papers during her career, is a regular speaker and chair at telecoms events, and is a judge at the Global Mobile Awards presented at Mobile World Congress. Teresa is passionate about helping CSPs optimise the value of their software and data, and strongly believes they will play an increasingly important role in helping CSPs differentiate their offering, operate profitably, and attract and retain customers. You can follow Teresa on Twitter at @teresacottam and can connect with her at www.telesperience.com

About Telesperience
Telesperience is a UK headquartered telecoms analyst firm focused on how software and data helps communications service providers improve their operational efficiency, commercial agility and the customer experience they deliver. We consider where the problems lie with legacy technology, and how companies can transition to provide a more positive telesperience for their customers and a more profitable business for themselves. For more information about Telesperience see www.telesperience.com, check out our blog at www.microsperience.com or visit our B2B wiki at www.wikisperience.com.

About Lithium
Lithium makes social software that powers the social customer experience. We help brands unlock the passion of their customers to build brand advocacy, drive sales, reduce service costs and accelerate innovation. Our software helps companies build vibrant online communities, connect them to public social networks, and infuse social conversations across every digital touch point.

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