It’s Tough to Be a Telecom Company, But Big Data Can Help

Telecom operators are facing burgeoning technology, fierce competition, and a changing environment. How can Big Data give them an edge?

Net neutrality. Increasing Over-The-Top traffic. Declining voice revenues. Expanded mobile services and ballooning customer expectations. No wonder that the traditional core infrastructures that have supported the telecom industry have become embattled. The world is changing how it communicates, and service providers need to keep up.

The trend, without a doubt, is data. Monetizing data traffic and data infrastructure is key to moving forward. Using Big Data technologies, communications companies can capture and analyze the huge amounts of information their customers generate. This allows them to develop offerings that speak to customers’ needs and wants. They can also monetize the data itself, opening opportunities to expand into Business Intelligence and other data services.

In this post, we’ll explore two ways that Big Data can help the telecom industry.

Big Data and Telecom Customer Service

First, let’s focus on how telecoms can use Big Data to improve their own businesses.

When was the last time a call to your mobile or Internet service provider left you feeling frustrated? For many people, customer service woes are a powerful incentive to find a new provider. How can companies use Big Data to encourage loyalty?

1. Know When and What to Sell. One company used analytics to design a customized data renewal offer to consumers who were nearing their data plan caps. This analysis included hundreds of variables, but the conversion rate jumped from 2% (pre-analytics) to 40%.
2. Talk to Customers in Their Own Jargon. Another telecom business analyzed social network activity specifically, how their customers use language. By moderating their message away from marketing and technical terms and towards colloquial speech, their conversion rate increased by 20%.
3. Design Campaigns to Combat Churn. Using Call Data Record Analysis, a provider learned that customers who dropped ten or more calls per month were eight times more likely to find another telecom operator. Knowing this, the company designed a campaign that specifically addressed these issues. They managed to retain a good proportion of their customers, including several high-value accounts. Using event-based churn modeling on similar problems helped another company improve the effectiveness of their anti-churn campaigns threefold.

How Companies are Monetizing Mobile Data

Now, let’s turn our focus outward to see how telecoms are using their data and infrastructure to make money from other companies:

• Using Data to Optimize Locations, Layouts, and Campaigns. One leading telecom company uses aggregated anonymous mobile network data to allow retailers to determine the best location and layout for new stores. Other retailers use a similar system to understand the traffic flow inside their stores and to tailor product promotions.

This stretches well beyond the retail sector. Aggregated mobile data has also been used by town councils to measure the impact of new features and buildings; by sports venues to manage traffic and crowds during events; and by emergency response teams to devise better plans by studying the movements of people at different times and places.

• Micro-Targeting. Another telecom provider uses web and location log data to help companies target campaigns based on micro-location, lifestyle and even device type.

• Positioning Billboards. Advertisers can use third-party data from mobile service providers to find the best position for outdoor ads. This data can also be used to help gauge advertising effectiveness.

Three Ways to Get the Best from Big Data

As we have seen, telecom companies are sitting on a potential mine of information. But like most other mining activities, it’s going to take some work to get to the good stuff.

Implementing and maximizing Big Data will require effort, and we know that it pays off. After helping many companies in the communications space, we suggest the following ways to get the most from your Big Data investment:

• Start Small and Plan Big. It’s often better to roll out a Big Data initiative in a limited way and then build on its success. Instead of a company-wide implementation, start with a department, see how it goes, learn from any mistakes, and imitate what worked. Once stakeholders and employees see the benefits, they’ll be more apt to adopt it.
• Be Specific About the Business Context. Don’t get swept away in the volumes of information that Big Data will inevitably generate. Define your business goals, and make sure any investments in skill or technology will support them.
• Invest in Humans, Not Just Technology. Data analysts and data scientists don’t come cheap, but if you are serious about getting the most from Big Data you’ll have to be serious about the humans that run it. Whether you’re looking at outsourcing or doing your data analysis in-house, you need the right talent.

It’s not an easy time to be a telecom company, but it’s an exciting one if you are willing to try out Big Data. Operators who are willing to embrace the insights and opportunities that technology gives them can find themselves well ahead of their less nimble competitors.