Prepaid Mobile Churn Management


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Presented in Amsterdam, 2002

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Prepaid Mobile Churn Management

  1. 1. CHURN MANAGEMENT Prepaid Mobile 2002 Alexandre Lourenço Head of Consumer Market Dep. TMN - Portugal
  2. 2. Portuguese Market Overview
  3. 3. Portuguese Market Overview (1) Customers and major Steps 1989 TMN Analogue Network 76% Penetration Rate Thousand customers Source: ICP and Operators Oct 92 GSM900 Competition (Telecel /Vodafone ) Set 95 Prepaid (Mimo TMN) Mar 98 GSM1800 Nov 2000 GPRS Set 98 3rd Operator (Optimus) May 2000 WAP
  4. 4. Portuguese Market Overview (2) Market Shares (on n. of customers) Source: Operators
  5. 5. Portuguese Market Overview (3) Next Steps May’ 02 <ul><ul><li>Oni-way : The 4 th Portuguese Mobile Operator. </li></ul></ul><ul><ul><ul><li>enters in the Market but using TMN GSM Network (Internal Roaming deal). </li></ul></ul></ul><ul><ul><ul><li>In 2003 will launch UMTS </li></ul></ul></ul>Jan’ 03 <ul><ul><li>UMTS </li></ul></ul>
  6. 6. What Is Prepaid Churn and Prepaid Churn Management ?
  7. 7. Prepaid Churn Management Prepaid Churn Churn Management Churn due to lack of recharges Churn due to not producing traffic Churn Reasons Analysis Prepaid Life Cycle Management Incentives to recharges and traffic
  8. 8. Methodologies and Processes to Reduce Churn
  9. 9. Methodologies and Processes to Reduce Churn <ul><li>Better Offer: </li></ul><ul><ul><li>coverage, </li></ul></ul><ul><ul><li>prices, </li></ul></ul><ul><ul><li>additional services, </li></ul></ul><ul><ul><li>customer service and </li></ul></ul><ul><ul><li>institutional image . </li></ul></ul>Handset Change programs Incentives to use Advantages on Partners Loyalty Contracts Retention Programmes Best Customers Focus TMN Star Reducing churn...                                                                 
  10. 10. <ul><ul><li>Up-grade is a handset change program; </li></ul></ul><ul><ul><li>The up-grade packages includes an handset and offers a bonus to the current card of the Customer, higher that the one he can get on prepaid packages. </li></ul></ul><ul><ul><li>The prices of up-grade and prepaid packages are similar; </li></ul></ul><ul><ul><li>Customers value this type of product because they can upgrade their handset for a good price and still earn bonus! </li></ul></ul><ul><ul><li>Up-grades creates an additional incentive to continue using the actual Customer card (the bonus is given on the recharges). </li></ul></ul>
  11. 11. <ul><ul><li>This handset change program offers to the Customers the chance to buy modern handsets at a very competitive price. They only have to sign a loyalty contract and stay in TMN for 24 months. </li></ul></ul><ul><ul><li>This products include a bonus of approx. 21 € that will be included in the monthly invoices 31 days after signing the contract. </li></ul></ul>
  12. 12. <ul><ul><li>Pontos TMN is a loyalty club that transforms € 1 spent in one point. </li></ul></ul><ul><ul><li>Apart from the feeling of being member of a Club, our costumers also feel that their money worth more. </li></ul></ul><ul><ul><li>The points earned can be change for: </li></ul></ul><ul><ul><ul><li>Credits of €5, €15 and €25; </li></ul></ul></ul><ul><ul><ul><li>Handsets (like Nokia 3330, Siemens S45 or Motorola V50); </li></ul></ul></ul><ul><ul><ul><li>Advantages in Partners (like Fnac and Cable TV); </li></ul></ul></ul><ul><ul><ul><li>Gifts TMN (Bycicles; Umbrellas; Calculators and Sweat-shirts). </li></ul></ul></ul><ul><ul><ul><li>... all with no extra charges </li></ul></ul></ul>
  13. 13. <ul><ul><li>Pako it’s a prepaid card that offers bonus for received calls. </li></ul></ul><ul><ul><li>It incentives to reduce churn because the customer only have to receive a call in a three months period; </li></ul></ul><ul><ul><li>The bonus is only earned when the card is recharged, creating an addittional incentive on keeping the card active. </li></ul></ul>
  14. 14. <ul><ul><li>On this partnership € 1,25 spent on TMN is equal to 1 mile to be used in Sky Club frequent flyer program. </li></ul></ul><ul><ul><li>With some points from PONTOS TMN program Customers can ask for a Fnac discount check. </li></ul></ul><ul><ul><li>With 1 point earned on Espirito Santo Bank loyalty program, the TMN Customer can get € 0,025 credit on is account. </li></ul></ul>
  15. 15. <ul><ul><li>On this partnership € 1 spent on TMN is equal to 1 mile to be used in Qualiflyer Group frequent flyer program. </li></ul></ul><ul><ul><li>With some points from PONTOS TMN program Customers can ask for different TVCabo cable TV service discounts (ex: set-up service, premium channels, ...) </li></ul></ul>
  16. 16. <ul><ul><li>Predict the behaviour of C ustomers that will most likely do churn ; </li></ul></ul><ul><ul><li>“ Betting” in the most profitable C ustomers ; </li></ul></ul><ul><ul><li>Focus on “trigger/offer management” - TMN is offering bonus on the next recharge; </li></ul></ul><ul><ul><li>“ Trying and Learning” perspective; </li></ul></ul><ul><ul><li>Shortening time to campaign will lead to maximize retention results; </li></ul></ul><ul><ul><li>Avoid retaining always the same Customers. </li></ul></ul>Retention Programmes
  17. 17. <ul><ul><li>This program is dedicated to our best Residential Customers; </li></ul></ul><ul><ul><li>Focus on special offer to this segment: </li></ul></ul><ul><ul><ul><li>Best Operator Service: special call center services, free handset assistance and more time to pay the bills; </li></ul></ul></ul><ul><ul><ul><li>Different advantages on Partners (ex: free tickets, discounts, ...). </li></ul></ul></ul>TMN Star
  18. 18. Lessons to Learn
  19. 19. Lessons to learn Source: Qmetrics <ul><li>An Operator must never forget what are the main reasons that can motivate a C ustomer to leave , like : </li></ul><ul><ul><ul><li>Handset Change </li></ul></ul></ul><ul><ul><ul><li>Handset stolen/lost </li></ul></ul></ul><ul><ul><ul><li>Operator Prices too high </li></ul></ul></ul><ul><ul><ul><li>Handset damage </li></ul></ul></ul><ul><ul><ul><li>Operator Bad/few services </li></ul></ul></ul><ul><ul><ul><li>Operator Bad assistance </li></ul></ul></ul><ul><ul><ul><li>Operator Bad Coverage </li></ul></ul></ul>
  20. 20. Lessons to learn <ul><li>The Loyalty Programmes and Retention Campaigns are effective and profitable . </li></ul><ul><li>If an Operator offers various crossed or non-crossed loyalty programmes it’s harder for C ustomers to leave the Operator (they’ll loose benefit’s). </li></ul><ul><li>Our market research indicates that our churn rate is lower than competitor’s one. </li></ul>
  21. 21. Next Steps
  22. 22. Next Steps <ul><ul><li>Efficient coordination of Loyalty Programmes so that the effort rates aren’t so high; </li></ul></ul><ul><ul><li>Always pay attention to the Market and to the Competition . </li></ul></ul>
  23. 23. CHURN MANAGEMENT Prepaid Mobile 2002 Alexandre Lourenço Head of Consumer Market Dep. TMN - Portugal