The communications service provider (CSP) industry is facing substantial disruption. Streaming platforms like Netflix, Amazon and Apple’s iTunes, along with direct-to-consumer IoT smart home devices, are increasingly bypassing traditional CSPs. To stay relevant and competitive, CSPs must offer services that deliver simple, personalized and seamless experiences.
Data and analytics power these customer experiences and engagement models. Simple examples include recommending videos of a certain type or length to specific demographic groups based on viewing patterns. Yet even with vast stores of data—viewing habits, billing records and demographic details—many CSPs lack the digital tools and analytical expertise needed to turn information into meaningful, personalized insights and services.
The road to digital transformation
To differentiate customer experiences, CSPs must increase their reliance on analytics to generate actionable insights and accelerate the rollout of new products and services. That shift requires a focused digital transformation.
Every CSP can embark on this path, but they must first address organizational agility and customer experience management challenges that could hinder progress. Industry studies and reports highlight these areas as common obstacles during digital transformation journeys.
Fortunately, CSPs do not need to abandon existing infrastructure. They can build a digital-ready architecture that overlays and enhances current systems by leveraging cloud-based networks.
Key considerations for CSPs building an integrated digital telco ecosystem include:
Use customer experience management (CEM) to improve retention: Implement an omnichannel strategy from the start. Offer combined services—broadband, television, mobile and fixed telephony—as well as flexible contract options and AI-enabled self-service. These capabilities help deliver consistent, frictionless experiences across touchpoints.
Prioritize organizational agility: Rapidly connecting networks and launching new services in response to customer needs helps counter the threat from over-the-top (OTT) competitors. Greater agility also enables CSPs to partner with OTT providers and present complementary services through an integrated digital platform.
Drive cost control and productivity: Re-examining and streamlining operational processes—such as consolidating data centers or centralizing network operations—reduces inefficiencies and lowers operating costs.
Modernize networks: Video will continue to dominate mobile data traffic, requiring CSPs to scale capacity efficiently. Investing in hardware or leveraging cloud services are both viable approaches. Software-defined networking (SDN) and network function virtualization (NFV) deliver flexibility, automation and cost savings. SDN provides a centralized network view for orchestration and automation, while NFV accelerates service innovation. Together, they enable faster, more efficient service launches.
Reassess IT investments: Incorporating technologies such as machine learning and predictive analytics empowers CSPs to personalize offers and add contextual, human-centered insight to customer interactions.
Customer experience underpins true digital service providers
A successful digital ecosystem must benefit both the business and the end customer. The ultimate goal of a CSP’s digital transformation is to evolve into a digital services provider (DSP). Market-leading DSPs and many social platforms excel at engaging customers in timely, relevant ways. CSPs need to make this transition, yet many still lack the capabilities required for real-time, personalized engagement—such as upselling services based on immediate preferences.
Managing customer experience deliberately is critical to retention. CSPs already possess a major advantage: large reserves of customer data. The challenge is to effectively harness that data and combine it with human-centered or “thick” data. This combined approach treats customers as individuals with emotions, preferences and needs, enabling providers to personalize not only offers but also the overall experience to drive growth, satisfaction and loyalty.
Developing a flexible digital services delivery model that can be continuously adapted and optimized is essential for delivering timely, personalized customer experiences. With such a model in place, traditional CSPs will be better positioned to compete with the next wave of on-demand entertainment and digital service platforms.
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