Driving brand advocacy_for_telcos

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  • 1. Key toolsto drive profitablecustomer relationshipsBerlin, May 22nd 2012Alexander Meili, European Strategy Officer
  • 2. Who we are• ICLP Loyalty – A full-service loyalty marketing agency with a global presence – 25 years of experience in loyalty marketing – Strategy / Insight / Dialogue / Delivery• Collinson Latitude (sister company) – Innovative products/tools delivering incremental revenue to clientsPage: 2 © 2012
  • 3. About telco loyalty
  • 4. Increasing need of innovative loyalty Tough macro context: Digital revolution: Saturated markets Commoditization Cannibalization European Countries in Recession (at least 2 consecutive quarters of negative growth) 17 mill. people jobless (11%) -10 €Bn Focus Increase of on Demand contraction commercial retention agressiveness SMS Revenue Loss due to OTT players of telco operators worldwide, 2011(1) Source: Eurostat, March, 2012 and IMF, 2012. (1) Source: Ovum, 2012. Page: 4 © 2012
  • 5. 3rdFocus shift happening most important reason to change provider 4% 43% (after: new handset, 76% lower rates) prepaid subscribers 3rd party Telcos have a loyalty rank loyalty programs model program offering high value (Americas: 60%) gifts most appealing (Europe: 35%) (71% on contract) 74% TELCOSubscribers Points driven LOYALTY Telco loyalty facts 50% expect higher 66% FACTS Operators customer level support when being believe that loyal or premium customers are less client loyal today than they were two years ago 70% 20% expect shopping cite customer vouchers as retention and loyalty loyalty reward as the critical factor for driving their growth Sources: ICLP, Amdocs, Buongiorno , World Mobile CongressPage: 5 © 2012
  • 6. Recent program launchesPage: 7 © 2012
  • 7. Loyalty models applied Privileges (soft) legend: programs no programstargeted ‘Tiers ‘Tiers and points Tiered program that recognizes Reward and Recognition customers according to program that offers Telco and ARPU spend with Telco and non-Telco services and rewards non-Telco services ‘Information led ‘Points Customers receive points for Customers receive Telco money spend and interactions promotions and exclusive Telco- with Telco that can be Partner information – no redeemed for new Telco registration needed products simple Incentives (hard) simple targeted source: ICLP strategy, 2011Page: 8 © 2012
  • 8. Loyalty models applied Privileges (soft) legend: programs no programstargeted ‘Tiers ‘Tiers and points Tiered program that recognizes Reward and Recognition customers according to 11% ARPU spend with telco and non-telco services 4% program that offers Telco and non-Telco services and rewards trend ‘Information led ‘Points increasing! Customers receive points for Customers receive Telco money spend and interactions promotions and exclusive Telco- 57% Partner information – no registration needed 28% with Telco that can be redeemed for new telco products simple Incentives (hard) simple targeted source: ICLP strategy, 2011Page: 9 © 2012
  • 9. Why is loyalty getting this buzz? Customer lifecycleCustomervalue Upselling  Word of mouth Intensification  From acquisition to long term engagement Activation Avoid downselling  Retention cost < Acquisition cost  Profit center  Churn prevention Acquisition Customer retention Customer win-backPage: 10 © 2012
  • 10. However, some failed… Low engagement of customersLack of top executive Lack of customersponsorship insight Proposition not Business case compelling enough built on non- realistic grounds Performance insufficiently measured source: http://blog.iclployalty.com/tag/loyalty-programme-2/ Page: 11 © 2012
  • 11. What is the secretof successfulloyalty?
  • 12. The tool setPage: 13 © 2012
  • 13. Follow loyalty trends?Which ones? mainly tactical – long-term engagement not guaranteedPage: 14 © 2012
  • 14. Match competitor proposition? no differentiation – long-term engagement not guaranteedPage: 15 © 2012
  • 15. Start with the loyalty ladder! Advocate! Supporter Client Loyalty marketing Customer Prospect Traditional marketing driving advocacy is the key to guarantee long term engagementPage: 16 © 2012
  • 16. What drivescustomeradvocacy?
  • 17. Growth by customer advocacy: 8 tools 3. Empowered 4. Ambassador 1. Referral program 2. Tryvertising involvement program -10% 25% High partici- Customer Buy the pation and acquisition product awareness Vodafone after testing cost Welcome to Spain starts Joyn beta „…would you like to „wanna become a AT&T Refer- testing help design the new trend scout for a A-Friend program Boeing airplane?...“ year?“ program 5. Causal campaigns 6. Influencer outreach 7. Advocacy tracking 8. Innovation churn reductiongenerates 30% (non core) BT, in advisory Feed-volunteer sales boost churn Benefit bundles support of panel back sales reduction adding Childline outside differentiation -in Page: 18 © 2012
  • 18. CEM: Exceeding customer expectations Adocacy toolbox 1. Referral 2. Tryvertising Added program Value Experience 3. Empowered 4. Ambassador involvement program Expectation level Experience level 5. Casual 6. Influencer campaign outreach 7. Advocacy 8. Innovation trackingPage: 19 © 2012
  • 19. Performance predictor NPS leaders 4x growth vs. industry average the more clients who are advocates, the higher the growthPage: 20 © 2012
  • 20. Take-aways Difficult economy calling for impactful loyalty Advocacy = long term strategic goal of loyalty Correlation with revenues as ROI Most powerful asset: Existing customers Validated tools to drive advocacyPage: 21 © 2012
  • 21. Thanks!ICLP LoyaltyAlexander MeiliEuropean Strategy Officeralexander.meili@iclployalty.com