This month’s round of telecom earnings reports shares a theme: in a recession, consumers no longer act out of habit — they’re examining and shifting their communications spending based on customer service, network quality and overall value. Those results are hurting some operators, perhaps none more so than Sprint Nextel Corp. (S), U.S. Cellular (USM) and Vonage Holdings Corp. (VG) Each has watched thousands of subscribers — 991,000, 88,000 and 89,000, respectively — defect in favor of bundled, better-priced and no-contract options.
So it’s interesting timing that the Customer Experience Board (CEB) has released its report, “Service Invention to Increase Retention.” The findings contain critical information for providers, the most important perhaps being that executives can’t automatically blame the recession for their companies’ poor performance. Report authors put it this way: “As market pressures increase and margins erode, the commitment to operational excellence and back-end efficiency frequently lags, often undermining the quality and consistency of the customer experience.”
In other words, the recession has prompted introspection and change among consumers. The same must go for service providers lest they find themselves lagging their rivals once the economy turns its frown upside down.
To that end, it’s best for operators to identify and fortify their weaknesses now. And according to the CEB, there’s a lot that carriers and other communications providers need to do to get up to speed.
For example, only a few in the industry have installed “real-time customer listening and feedback systems that quickly identify and alert management to problems, issues or risks in the everyday customer experience.”
Plus, too many still keep their data in disparate systems. This siloed approach “remains unconsolidated and untapped from a customer insight and intelligence-gathering perspective, and marketing groups rarely have a hook into the customer service and support center.”
That may not sound like a big deal. Until you consider the following: a recent Harris Interactive poll found that 80 percent of consumers will not patronize an organization after a negative experience. To fix the problem, operators’ marketing departments, the CEB report notes, must “revitalize sagging loyalty and retention numbers and drive top-line growth through deeper, more meaningful engagements with customers. Service providers must, more than ever before, upgrade customer interactions in order to foster lasting and profitable relationships.”
