The marketing mantra of right offer, right customer, right time has been around for years, and in the telecoms industry offers have been relatively straightforward. Every communications service provider (CSP) has a system that sends alerts to customers (e.g. for topping up pre-paid accounts) and many have campaign management systems that send information about new data offers and new handsets.
Personalized marketing, direct to the handset, has until now been relatively straightforward as most offers were data bundles with the occasional content add-on (usually Netflix or Spotify). However, you could argue that with a limited range of offers the marketing messages from CSPs haven’t really been that personalized at all, more of a standard offer to a standard customer at a standard time type approach to marketing personalization.
5G SA (standalone) is set to change this. In terms of marketing campaigns and customer value management, CSPs can get a lot more personal, meaning greater uptake of offers, new revenue streams, and a better digital experience for the customer. A recent report from McKinsey revealed that 71% of consumers expect companies to deliver “personalized interactions” and 76% “get frustrated when this doesn’t happen.”
Personalization isn’t just a “nice-to-have” anymore — customers expect it. They are used to personalized offers and recommendations from Netflix, Amazon, and Spotify and don’t see any reason why they shouldn’t get the same level of personalization from other service providers. However, when done well, personalization can significantly increase revenues as the McKinsey report also highlighted that “companies that excel at personalization generate 40% more revenue from those activities than average players.”
Personalization isn’t just about making the right offer. It needs to be at the right time as well as contextually aware, and it needs to be part of a longer process aimed at providing a personalized experience that makes the customer happy, loyal, and more valuable. The key to effective personalization is the use of data—and this is a big advantage that CSPs have. They have the network data for geolocation, usage data, as well as historical data on purchases, preferences, and profiles.
It is a combination of this data that can act as a trigger for a recommendation as well as guide what is offered and where the offer is made. It can also be used to determine what, when and where customer rewards can be delivered. By delivering a personalized, contextual experience, CSPs will build up profiles of customers so they can intelligently fine-tune offers to make them more personalized, and therefore, more attractive to customers.
To review how personalized, contextual marketing can work with 5G below are four use cases that cover gaming, family 5G experience in the home, smart city shopping mall and delivering a stadium event experience:
Looking at the above scenarios, there are a lot of moving parts, a lot of triggers and dependencies, and a lot of partners. This can open up new revenue streams for the CSP, which could include a % of the transaction value from a 3rd party partner and advertising revenues. Building complex, multi-party offers with a range of revenue-sharing agreements may be new ground for CSPs. Using a legacy offer catalogue that was designed to include a limited set of variables such as minutes of voice, number of texts and GB/MB of data could be a stretch.
The CSPs should, if they want to, build offers and processes themselves in hours using a GUI-driven no-code approach. These are then made available to a pre-integrated recommendation engine that executes them with a combination of pre-defined triggers consisting of network data, profile, and preference data. By using a no-code approach offers, recommendations, and rewards can be quickly and cost-effectively developed. This agile and fast approach enables CSPs to try out new ideas for personalized marketing without the high cost or fear of failure.
The four scenarios discussed in this article are the tip of the iceberg of how real-time, contextual, and personalized marketing can deliver a better 5G experience to customers and open new business models for CSPs. The underlying technology can also be used to provide personalized engagement with customers in a wide range of 5G verticals including telehealth, smart cities, education, and entertainment to name but a few.
Martin Morgan, Qvantel
Tero Lindholm, Nokia