To Drive Profitability, Telcos Need a Firmer Grip on Their Value Levers

Telecoms operators have problems to deal with left, right and centre as the UK’s cost-of-living crisis continues to unfold. Alongside being directly faced with problems, such as spiking energy prices driving up the cost of key operations like running stores and data centres, they also have to think about how their customers are being impacted. They also need to consider the risk of bad debt creeping in, with customers being unable to afford their tariffs and device contracts.

As part of this, they have been compelled to find new ways to support customers who are struggling, with all major telcos signing up to new emergency commitments – including exploring the possibility of launching new, affordable tariffs. All of these challenges are driving demand for time-critical decision making, covering everything from the operation of stores, to the make-up of current and future tariffs and bundles.

However, operators can never have a realistic chance of getting all these decisions right if they don’t have a granular, accurate understanding of the drivers and levers that impact value. But just how firm a grasp do they have on them, in reality? Our recent research, which investigates how data can help to define and transform telecom customer base value shows that telcos are currently in a halfway house: operators want to be value-driven, but fewer than a fifth currently are. This means important business decisions are often being made on incomplete – and potentially inaccurate – assumptions and data.

At the moment, many telcos use gut feel, incomplete data, or slow, inaccurate platforms and spreadsheets for decision making. But by drawing on both internal and external expertise to set out a systematic approach for using data to understand customer value, they will be on course to get the big decisions right.