The Medallia Team

“Name a telco company that provides a great customer experience.”

To many, this can seem like a trick question.  The phrases “telco” and “great customer experience” rarely seem to occur in the same sentence.

Perhaps this is because telcos have traditionally not really had to think about customer experience.  As a subscription-based business, they’ve been pretty good at locking in their customers via two-year contracts.  They lure in customers with attractive phones and service deals at the end of these two-year cycles, and once customers have bitten the lure, they’re allowed to sink back into the mediocrity of telco customer service.

But customer expectations about subscription businesses are changing.  Transactional businesses are adopting practices that drive subscription-like customer behaviour.  Think of Amazon, whose focus has been on retail, but whose frictionless experiences and excellent customer service have driven consumers to return again and again.  Customers are rewarding Amazon with actual subscriptions to its Amazon Prime service, with 10 million people signing up over just this past holiday season.  Customers are increasingly expecting this kind of service in their subscriptions.

Furthermore, it’s becoming easier than ever to switch providers, with some carriers even offering to pay the early termination fees of their competitors.  Earlier this year, the US senate passed the Unlocking Consumer Choice and Wireless Competition Act, making it easier for people to legally unlock their phones.  All these changes mean that telcos will increasingly need to focus on customer experience during contract terms — not just during contract renewal.

With changing policies empowering consumer choice and changing customer expectations, customer experience is becoming an increasingly important differentiator for telco companies.

Sunrise, the biggest telecom operator in Switzerland, understands that customer experience is a necessary strategic focus for this changing telco landscape. To realize this focus, they’ve embedded customer feedback into everything they do. And the results have been dramatic: their retail Net Promoter Score has shot up 50 points. Their call center volumes have dropped 20%.

It’s given Sunrise a strong basis of differentiation from its competition to attract new customers; it’s reduced churn, helping to keep existing customers; and it has driven a reduction in the costs associated with servicing dissatisfied customers.

Effectively, Sunrise has been able use customer experience to both increase revenues and reduce costs all at the same time. They’re differentiating themselves from their competition, reducing churn, and eliminating the customer pain points with an associated reduction in the costs associated with servicing dissatisfied customers

Since telco companies aren’t ordinarily associated with best customer experiences, this is an excellent opportunity to differentiate, especially at this time when customers most expect customer experience innovation.

Photo credit: Prayitno