Getting Loyalty Programs Right: A Priority for Telecoms Operators.

Getting Loyalty Programs Right: A Priority for Telecoms Operators.

Digital services require more engaging loyalty programs from operators

Monday November 23,2015

Clare McCarthy

Practice Leader, Telecom Operations and IT

Summary

Digital services require more engaging loyalty programs from operators
Operators are at a critical point in their lifecycle. They are undertaking digital transformations in an effort to become more agile, efficient, and profitable in the face of disruptive and competitive forces targeting their core business. As operators undertake major organizational and business change they must adopt a more engaging and proactive approach to their loyalty programs if they expect to retain their profitable customers and make loyal customers the foundation of their digital business.

Ovum view
Customer loyalty is increasingly important for operators, yet they do not seem to be successfully engaging with their customers and developing them as advocacy ambassadors. The landscape is littered with tired loyalty plays and characterized by poor customer experiences and badly designed processes. With millions of marketing dollars being invested in the sector, it is puzzling that operators have not taken advantage of their customer reach and customer data stores to be more relevant and engaging.
This report looks at how operators can generate brand loyalty and advocacy by using analytics solutions to leverage data on customer behavior and preferences and create relevant and personalized customer offers. We also investigate why operators should associate themselves with lifestyle brands to differentiate and enrich their customer offers and improve customer satisfaction, as well as reduce the cost of their loyalty programs.

Key messages

  1. Customers value being valued and want loyalty-based rewards that address their personal interests. However, operators also need to engage proactively with their customers to get them to buy into their services and brands to ensure advocacy.
  2. Gamification is a powerful method of incentivizing positive customer behaviors that generate loyalty and rewarding customers with something that they want.
  3. Operators also need to partner with attractive, quality brands as part of their loyalty campaigns. Two-for-one deals and discounts face competition from Groupon and VoucherCodes, so more exclusive brand deals are more likely to deliver a valued reward to customers.

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