Business Intelligence 2.0 – TheHidden Treasures in Cell Tower Data November |2010
Business Intelligence 2.0 – The Hidden Treasures in Cell TowerDataA new and unconventional means for learning about one’s customers, cell towerscapture unique information that can be used in groundbreaking manners by anymobile operator to better serve, market, and sell to its customer base.Customer-related business intelligence efforts in telecoms have traditionallyrelied on a standard set of information about the customer base, be it a BI effortaround predicting churn, segmenting customers, identifying sales opportunities,etc. Normally analyzed categories of information have included (on a customer-level) those that are usage related (VAS, SMS, international calls, etc.), volumerelated (frequency, length, etc.), value related (ARPU, profitability, etc.),information that is then analyzed in light of the demographical uniqueness of eachcustomer in an effort to identify patterns.Most telecoms in developed countries have by now tapped in to their businessintelligence to segment their customers, and to develop churn prediction models.Recently some have gone a step further and defined the social networks formedwithin their customer base, among other models they have developed withbusiness intelligence.What almost no telecom has done is to use the wealth of data captured by celltowers regarding its customer base, data that can not only be used to strengthenexisting models, but to launch new ones. From helping telecoms decide where toopen a new dealer to how to allocate its marketing communications budget, celltowers are the next great source of business intelligence for mobile phoneoperators.Cell towers (also known as cell sites), for those who may be new to the term, areessentially antennas that are placed on top of buildings or are standalonestructures that allow mobile phone subscribers to receive a signal when they tryto make or receive a call. Each cell tower is able to cover a certain range and thusallow subscribers within that range to benefit from its signal. To cover the USA,for example, mobile phone operators have put up more than 250,000 cell towers,spread strategically so as to maximize their individual network coverage ranges.Being within close proximity of a cell tower is in and of itself not enough to ensurereceiving a signal however, as these towers have a number of channels availablefor usage at any given time – one cell tower along cannot cover an entire cityblock of Manhattan, for example, if half the subscribers on that block try to makea call at the same time (as is the case in emergencies when one has a difficult timegetting a signal).
One final note about cell towers – when subscribers talk on the phone while theyare driving, they will switch between them as the signal of one fades and theother strengthens. Thus, during the course of a 10 minute drive a subscriber maybe switched between 5 – 20 towers, depending on how rural / urban the areathey are driving through is.When it comes to business intelligence, it’s not about how cell towers work, butmore about what information they capture about subscribers who connect tothem at any given time. Some of the key facts gathered in each and every singleconnection to the cell tower by a subscriber include: Subcriber Phone Number / ID Type of Connection (Voice, SMS, Data) Time of Connection Duration of Connection Direction of ConnectionIn and of itself the above doesn’t seem to add up to much in terms of businessintelligence. It’s when this information is combined with other key facts aboutsubscribers that the true value can be obtained. Add in to the mix… Subscriber Nationality Subscriber Age Subscriber Gender Subscriber Value-Added-Service Usage Subscriber ARPU Subscriber Handset Subscriber Churn Risk (if conducted) Subscriber Customer Segment (if conducted) Neighborhood by neighborhood population data (if available)…and now numerous findings will be obtained that can be used by sales andmarketing teams in telecoms to take action on. Five examples to start with:1. Neighborhood-by-Neighborhood Market Share: As most telecoms have noidea where their subscribers actually live (especially in prepaid dominatedmarkets), they have no way of knowing their penetration rates in a given city, letalone a neighborhood. By examining each subscriber’s key cell tower connectionin the evenings and on weekends, a telecom can assign a general address to each
customer, down to that given cell tower’s location. Doing this for every customerwill give a telecom a general home address for each one, thus allowing it forpossibly the first time to know its subscriber base city-by-city, neighborhood-by-neighborhood.Combined with neighborhood level population data, a telecom can estimate itsmarket share and penetration rate across the country. This data can be used bysales teams in innumerous ways, from determining where to possibly open a newdealer store, to deciding where to send door-to-door sales representatives(especially for the SOHO / SME segment). Information that would normally costthousands to obtain via market research is already available thanks to cell towers.2. Neighborhood-by-Neighborhood Connection Types / Time / Duration /Direction: Using the same principles above, a telecom can know down to aneighborhood level the usage behavior of its customers. In some parts of a city atelecom will find that local SMS is popular on weekends, in others, short voicecalls abroad. Not only can such information be used to help design new tariffs andcampaigns, but also to determine how to market down to a neighborhood level.The telecom can be positioned as the best when it comes to its SMS bundles in aneighborhood that cares for SMS, whereas in another the low off-peakinternational calling rates will be put in the forefront – this done in the form ofbillboards, flyers, in the dealers located there, etc.3. Value / Churn / Location: Combining consumer churn likelihood and value,telecoms can identify which cell towers are critical in terms of retention – thosetowers with customers assigned to them that have high value / high churnlikelihood are of the utmost importance. Studies have historically found poornetwork coverage plays a critical role in churn – the capacity of these mentionedcell towers must be examined to ensure consumers do not experience droppedcalls in their home zones, or, even in their workday zones. Cell tower boosters oradditional cell towers may need to be considered in cases where capacity issuesare observed.4. Neighborhood-by-Neighborhood Value-Added-Service Usage: Akin toconnection types, analysis of the home zone of consumers will identify in whichneighborhoods certain value-added-services are popular, have succeeded, or havefailed. Such an analysis would thus again show the potential in any given area ofthe city for any value-added-service, and would determine marketing strategiesdown to a neighborhood level. For example, the neighborhoods that have thehighest mobile phone data usage would be the best bets for putting up billboardsfor a new GPS Maps or Online Gaming application to be or recently launched.5. Cell Tower Segmentation: Taking into consideration all of the abovementioned pieces of data and different observations, telecoms can segment theircell towers into actionable clusters, assigning them each a value based onconnected subscribers, their churn risks and segments, their tenure, etc. Such aneffort would help a telecom know which cell towers need to be prioritized when
they go down, which ones should be upgraded to 3.5 technology based on thoseconnecting, which ones are below-zero (have the lowest ARPU subscribersconnecting to them) and can be maintained / consolidated, etc.The above is really just the tip of the iceberg. Once a telecom gets the basics setup, the ways in which cell tower data can be used will increase, findings it wayinto the core of sales, marketing, and operations teams, becoming anindispensable part of their intelligence-driven day-to-day practices.Cell towers also capture significant information regarding international customersroaming in the country, information that can be used in numerous ways to deviseseparate strategies aimed at getting the most out of each of them.
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