What do subscribers want?

Mobile operators need to think more about targeting their customers, says telecom consultant Mohammad Habeiila.

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By  Mohammad Habeiila Published  June 14, 2009

Mobile operators in most Middle Eastern countries lack an effective segmentation approach that can provide them with a deeper understanding of business subscriber needs, what products and services to offer them, clear portfolio ownership and most importantly help operators identify their corporate market share and potential.

Many operators have adopted a mass sales approach. In many cases and within the same portfolio of accounts for a relationship manager, one can find large companies, SMEs, governmental institutions, hospitals, banks … etc!

Sales people are commission driven, and if not provided with clear guidance about who they should target, they will always sell in mass and to any company in order to achieve their sales targets.

Hence, it’s the responsibility of the marketing department in coordination with the sales management team to provide a clear segmentation approach to enhance relationship management, avoid account ownership overlap and improve subscriber lifetime value.

Resulting in increased market share, higher revenues, and more satisfied customers.

So, which segmentation approach should you adopt, and what elements should you take into consideration when segmenting? A company’s size and number of employees? The type of business? The geographical location? The type of subscription (Postpaid vs. Prepaid)? Calling behavior? ARPU?

It can be a complicated exercise, and many factors need to be taken into account.

There is no simple answer, and segmentation varies from one market to another. But the most important thing you should think of before segmenting any corporate market is “what do subscribers want”.

Based on that, you’ll be able to come up with a segmentation approach that satisfies your business subscribers, retain them and even extract more value from them through cross selling activities.

Being able to identify your corporate subscriber needs helps in developing the right products & services and market them to the right customers.

For example, approaching a transportation operation company (i.e. Taxi) with a bundle of talk time, advanced value added services, international and roaming bundles will not attract many subscribers.

But a fleet management solution with an option for all drivers to talk within the group at a discounted rate, location based service, and basic data services (SMS, MMS) will achieve goals set for this particular sector and satisfy customer needs.

Business market segmentation is more challenging than it is in consumer market; as sales cycles are longer, offerings are more complex and customers care about the total solution cost rather than the initial service cost.

In addition, since most of the B2B campaigns are conducted below the line, it’s much more difficult to reach the buying decision makers.

Other challenges include gaining valuable market intelligence and really knowing what the competition is doing, as well as understanding business customer needs, since they vary widely according to the industry they are in.

To address these concerns and create a truly effective segmentation approach, operators really need to “know their customer” by:

Conducting proper profiling for existing and potential accounts

Understanding their customers industry (what product or services do they offer, who do they buy from, who do they sell to)

Understanding their customers calling behavior and needs

Distributing portfolios among Relationship Managers, taking into consideration each Relationship Manager skills and background

Setting reasonable sales targets for Relationship Managers according to the segment size and potential each serve, and linking them to a rewarding commission scheme

Identify skills (Acquisition skills vs. Retention skills) within your Relationship Managers, and distribute duties accordingly.

If your organisation believes that its business segmentation approach could be enhanced, we recommend identifying a target segment, applying the above simple rules, simulating their impact and then roll out to other segments.

We’re positive that you’ll achieve the results you’re looking for.

Mohammad Habeiila is the development manager of telecom sector at Huron Consulting Middle East

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