Mobile Phone Customer Retention And Churn Business Essay

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The first step in retaining the portfolio of quality customers is to first prevent attrition of current quality customers. Mobile phone service providers can more successfully grow their business portfolio by doing a better job of retaining profitable customers the same time reduce churn through more effective use of business analytic tools.

By better understanding of customer behaviour, mobile network service providers can shrink churn and develop marketing campaigns to increase customer retention.

In this paper I will explore the role of sound business intelligence (BI) and the use of knowledge management (KM) to achieve customer retention and reduce churn.

DESCRIPTION OF KEY VARIABLES TO IMPROVE DECISION MAKING

The ability to monitor, analyse customer data may be essential for retaining existing customers. The essence of key variables to decision making in this context is to collect customer behavioural information to basically improve mobile phone operators' decisions for retaining their customers that would otherwise likely be lost to the competition.

Discovering Customers Information

Having current information of customer can be valuable factor to improve the quality of decision making. Bio-data collected from customers by the mobile network companies are not appropriate data to predict customer behaviour, want and value. Under this variable, there are two major points to consider as sources of customer information e.g. pay attention to customer behaviour and customer feedback.

Pay Attention to customer behaviour

Sometime it is difficult for most mobile network companies to pay attention to their customer behaviour because they do not have direct relationship (in term of selling products) with their customers. They have to develop interface to interact with aim of discovering and documenting the customer behaviours.

Interface to interact with customers may require technology (to capture the information) and experts (to analyse the information). Mobile network companies need experts who can interact with customers through resources like collaboration and communication tools.

Customer feedback

Feedback has been one of the one of the successful tools companies use to know how their customers feel about their product. Today, it is will be difficult to get feedback from customers through conventional or traditional (filling physical paper form) way because the physical relationship between the companies and their customers are getting leaned. Even the tradition way of doing feedback is becoming cumbersome for companies. For example, companies need hire more customer service personnel to respond and digitalize paper feedbacks obtain from customers. 

Electronic generated feedback may give companies the upper edge in collecting information that will improve their decision making. An article sponsored by IBM stated capabilities of a kind of website companies should design to capture the attention and feedback of their customers. The article mentioned web experience should include a web content management tools, social and real-time communication capabilities, Search, Personalization, mobile device support, marketing tools, integration capabilities, and Real-time and predictive analytic. (The key to customer engagement, 2010, p. 4)

Customer Support

The Service Support Professional Association (SSPA) has identified the top five initiatives for technical support operations to tackle in order to deliver breakthrough customer support and ultimately enable customer success. The five initiatives are:

Increase employee retention and satisfaction

Improve customer experience

Leverage customer feedback with BI

Evolve from cost centre to profit centre

Adopt innovative tools and technology. (insight, 2007, p. 2)

Customer support has provided extensive results as a medium between companies and their customers in past. Based on collective initiatives of SSPA to sustain customer support within organization, customer support will definitely improve mobile network companies' decision making in action against customer churn.

Knowledge management

Knowledge management (KM) is the untapped resource embedded in organizations. Knowledge management is another decision support mobile network providers can use to develop workforce and indirectly empower them (employees) with ability to interact with their customers. Turban et al(2011, p. 471) defined the goal of KM as to identify, capture, store, maintain and deliver useful knowledge in a meaningful form to anyone who needs it, anyplace and anytime, within an organization.

KM can also be accessing customer knowledge base. Mobile network providers can invest in customer relationship management (CRM) system to develop customer knowledge repositories mentioned by Bueren et al (2004, p. 3).

CAPTURE CUSTOMER INFORMATION USING TECHNOLOGIES

From literature provided it was shown that the main causes of mobile network providers lose customers were due to collection of little information of their customer behaviours and poor design of data warehouses. Deploying Enterprise data warehouse and other technologies like, OLAP, Web 2.0, Knowledge discovery database will definitely result in sound BI and KM.

Enterprise data warehouse (EDW)

Technological reason why most mobile network companies experience customer churn is due to deployment of poor data warehouse. For example, a company that wants to be successful using business analytic to support its decision making for customer relation must deploy EDW.

EDW is a specialized kind of database that is designed to support business analytics and to contain and integrate data from one or many different sources into a standard format for effective BI and decision. EDW are used to provide data for many types of decision support system (DSS), including CRM, business performance management (BPM), and sometime knowledge management system (KMS). (Turban et al. 2011, pp 330-331)

Data warehouse Architectures for mobile network providers

An EDW should be designed to be easily accessible and comprehensive. There are different architectures for DW. Hoffer el al (cited in Turban et al. 2011, p. 335) distinguished among these architectures by dividing the data warehouse into three parts:

The data warehouse itself, which contains the data and associated software

Data acquisition (back-end) software, which extracts data from legacy systems and external sources, consolidates and summarizes them, and loads them into the data warehouse

Client (front-end) software, which allows.

Figure 2.1a shows basic architecture of web-based data warehouse. The diagram provides understand of what companies should have in view when design DW. However, EDW are complex, figure 2.1b provides clue of how any mobile network company should manage its corporate data better.

Figure 2.1a Architecture of Web-based Data Warehouse. Source: Turban al el. 2008, p. 336

Figure 2.1b Enterprise Data Warehouse Source: Turban al el. 2008, p. 339

Web 2.0

Web 2.0 is a technology that enables knowledge management and collaboration. It is a platform for most mobile network companies to interact with their customers because web 2.0 has indirectly empowers people. There are several Web 2.0 tools enterprise like mobile network providers can use to capture and share knowledge and information between customers and employees. Web 2.0 also can help mobile network enterprise to segment customers according to their needs. The need of post paid customers may be different from pre-paid customers. And at the end of the day, individual customer's need will be customised towards customer's want.

According to Turban el al(2010, p 427), Web 2.0 is the popular term for describing advanced Web technologies and applications, including blogs, wikis, RSS, mashups, user-generated content, and social networks.

Enterprise social network

Mobile network companies can interface with public social networks such as Facebook or create an in-house social network for communication (collect feedback, advertisement and support connections), collaboration (problem solving and creation) and Knowledge management(knowledge sharing, tech support and capture expertise) among employees and customers.

Enterprise Network

Enterprise Networks are internet, intranet and extranet. Internet incorporated with data warehouse is major technology for managing corporate data. It is a best platform for customers to express their desires and get their companies via web. And lastly, it is backbone infrastructure for social network.

INCORPORATE DISCUSSED VARIABLES INTO BI ARCHITECTURE

The previous two chapters have serious impact to how mobile network service providers should channel their ways towards achieving their strategic goals relating to retain their existing profitable customers or identify those customers who are not worth keeping.

It is necessary to incorporate and enable key variables and technologies discussed in two previous chapters into BI architecture.

A BI system has four major components that can significantly use to represent variables to improve decision making are namely: data warehouse, business analytics, business performance management and user interface.

Data warehouse (DW) receives data from one or more normal databases. The actual process of copying data from normal databases to DW is usually referred to as extract, transform and data process (ETL).

The extract step connects to the source databases and pulls the required data from it. The transform step rearranges the data into the schema used by the data warehouse. Finally, the load step actually places the transformed data into the warehouse. (Jones, (ed.) 2010, p. 13).

Business Analysis

This is where BI system comes into seen. With business analysis, end users (employees of mobile network providers) can work with BI tools and techniques.

Data mining

Data mining is defined by Turban el al(2011, p 21) as a process of searching for unknown relationships or information in large databases or data warehouses, using intelligent tools such as neural computing, predictive analytics techniques or advanced statistical methods.

Predictive analytics techniques

By applying predictive analytics to data prescribed in chapter one, mobile network service providers can uncover unexpected patterns related to customer behaviour and develop models to prevent profitable customers from leaving and sell additional business packages to current customers.

Predictive analytics improves how mobile network companies segment customers, identifies cross-sell opportunities and predicts which offers are most likely earn a positive response. It opens the concealed patterns within provided different data and exposes relationships that enable them to make recommendations that are highly targeted for each unique customer.

Business Performance Management (BPM)

Jones ((ed.) 2010, p. 9) defines BPM as a rollup reporting, predictive analytics, and other BI practices together with planning and forecasting. It's designed to provide a framework that organizes information, delivers news insight, takes action and optimizes performance.

BPM software can help mobile network operators organise diverse provided set of information from chapter one to develop a broad scope of each customer that includes:

Descriptive information that tells mobile network companies who their customers are such as demographics.

Behaviour information that summarize what they (customers) do, such as briefs of the plan (pre-paid or post-paid) they run, their methods of recharge (through voucher shop or online) and how often they recharge.

Interaction information that describes how they interact with the mobile network providers systems such as online feedback channel, customer supports, enterprise social network and etc.

Attitudinal information that describes why customers do what they do.

This customer discovery is highly unique to mobile phone service providers' relationship with their customers, and it allows them to gain competitive advantage.

User interface

User interface (UI) is comprised of dashboard and scoreboard. It is only component of BI that end users interact with. With all the data that a data warehouse can contain, most users will need simplified means of looking at information - Dashboards do not often drive direct decisions; rather, they let individual users get a feel for general performance, such as customer complaints, and so forth. (Jones, 2010, pp. 6-7)

CONCLUSION

The purpose of this report is to able to identify and meet individual customer want and need, which can result in customer's satisfaction. It will difficult to retain customers and avoid customers churn when customers are not satisfied.

I organized a survey among my friends who are active mobile network subscribers. Questions like 'how they become customer of X company, why they want to leave x company, why they use mobile phones and what they use their phone for' were presented in the survey. Two last questions actually reveal how mobile phone operators can meet the need of their customers. All of them claim they use mobile phone for the purpose of mobility. And when question like what they use their phone for presented to them ninety nine percent claimed it was used for calling.

At the end of the survey, I concluded that it is easy to identity individual customer need and value if mobile network operators can monitor what their customers using their network to do most and able to personalise and customise the their services to the need of individual customer or customers based on segmentation.

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