For just about every business, setting the right goal and putting together a plan to achieve that goal go hand in hand.
Take the airline industry for example.
I just got off a flight from Orlando last night. My goal was to get home to Seattle. Fortunately, my pilot had the same goal. The goal was simply defined – get the passengers safely to Seattle. An on time arrival (actually, we got in a few minutes early), and smooth ride (there were several bumpy periods that warranted the little ‘gift’ bag in the front pouch for some) were ALL secondary to getting us safely to Seattle.
The beauty of the airline industry is that the goal is pretty clear – getting travelers from point A to point B. All of the other stuff (like free ‘warm’ food, and nice stewardesses) comes secondary.
Having goal clarity, unfortunately, doesn’t always make its way to industries like telecom, however, and especially as it relates to delivering great customer experience.
When it comes to setting goals to deliver a great customer experience, many mobile operators are either near sited, schizophrenic, or both:
1) Near- sited: focus on driving acquisition to fuel growth. “Hey, as long as we can outpace churn with gross ads, we look good.”
2) Schizophrenic: goals that are in conflict. “We have this strategic product and we need to drive adoption across the base.” While at the same time saying, “We are customer centric focused on meeting the needs of our customers.”
3) Both: short term metrics at the expense of long term gain. “Let’s promote the data plans and drive take rates. We’ll deal with the low usage customers later.”
Planning is a by-product of setting the right goal. Setting short-sighted ones or too many goals lead to poor execution (inconsistent delivery), a lot of (internal) waste, and high churn.
So what singular goal should wireless operators have for driving customer experience? Keep churn down? Lift revenue? Increase product penetration?
None of the above.
For example, many mobile operators faced with declining voice revenues are pounding customers with offers to drive data revenue. In the process they overzealously push data sales (imagine an overly aggressive outbound telemarketing rep whose sales quota is based on gross sales) only to see customers churn off the data plan in two months due to low or no usage. The net result is ARPU lift of $5/month to $45 and subsequent churn 3 months later.
Was the $15 net in increased revenue worth losing the customer 3 months later?
Each of the above goals missed the mark because, by themselves, they aren’t holistic enough to counter balance the effect of each other.
THE goal for optimizing the customer experience should be to maximize customer lifetime value.
Focusing on maximizing customer lifetime value incorporates the 3 pillars of: ARPU, customer tenure (churn), and cost per customer. Focusing on customer profitability instead of each pillar creates the check and balance necessary to set plans in place that are singularly focused on driving customer experience.
Going back to the airline industry, having a unified goal makes life simpler. The game plan is set around getting customers to their chosen destination. Everyone knows it. No one substitutes other ‘mini’ objectives for it and (shy of disaster) every airline meets it. If they don’t, airlines go under and people get fired. It’s only from there that airlines add the niceties and differentiators that make them special, but if they can’t get you there, nothing else matters.
Mobile operators should think the same way. Don’t confuse driving VAS sales with building loyalty. Stop watching customers pay too much month over month on the wrong rate plan, and then offer to right fit them when they threaten to leave.
They need to focus on defining the ONE BIG GOAL and go after it. It’s time to get READY, AIM or be FIRED by their customers.
