Why it makes sense to launch a challenger brand
Telecoms is an industry that dates back decades and despite being one of the most established markets, unfortunately it’s backwards and outdated. It’s time for telcos to step into the future of communications. So what is the future? It’s launching challenger brands to meet customers’ expectations and needs, removing legacy IT and ultimately lowering OPEX. Below we give you the recipe for success to fight off the competition from both incumbent players but most importantly, digital natives.
What do customers really want?
When we founded our telecoms provider, Telness, we noticed a gap in the market for a flexible solution that leads with customer experience and value for money above all else - and it turns out, we’re not alone.
In our research conducted on 2,000 consumers we found that 95% over 25 year olds prioritise a good price, and 55% overall prioritise customer experience. Yet, when we asked telcos where they’re planning to invest, profitability was amongst the highest ranking, and on average only 31% of investment will go towards improving the customer experience.
Telco’s aren’t doing the maths. To turn higher profit margins, customer experience should be top of the list.
Why should you launch a challenger brand?
To stay relevant, keep up with competition and meet customer demands. Both from existing telecom competitors as well as from digital natives challenging the industry as a whole.
First, you can offer a radically simplified and differentiated product. The average incumbent telecom company has three to four times more mobile-package variations compared to challenger brands who have around two. The plans themselves are transparent, easy to understand, and can be changed to fit a customer’s shifting needs. This instant adaptability is key to growing popularity.
Second, you’re able to create an ultra-easy user experience. This marriage of a simplified offering and user-tested design means that customers end up having fewer questions and, as a result, the cost to serve drops significantly.
Third, you can launch flexible solutions that support innovation since you are not hindered by legacy IT. With the right tool stack, you can easily leverage cloud-native deployments whenever possible to simplify IT operations and reduce operational overhead.
Finally, an automated and modern tool stack can fuel revenue growth and enable you to get out to market with collaborations, campaigns and most importantly new product offerings, much faster.
How can Telness Tech enable you to do this?
At Telness Tech we run a modular, and automated platform that is centred around self-service and few manual processes. Four in five support errors are solved by the customers themselves via an omnichannel admin portal. Not only this, 100% of sales are fulfilled online, from purchase of a mobile subscription, porting and provisioning to activation. This enables businesses and consumers to administer the solutions themselves which keeps OPEX down for the solution providers such as operators.
Self-service solutions reduce the need for manual handling of support, and can result in a cost saving of up to 60-80%. For example at Telness, ⅘ errands are solved by the customer themselves either in the portal where they can administer changes themselves, or by reading support articles. This frees up money to invest in the things that really matter to customers - such as lower costs, being able to buy and change data, and the freedom to change plans.
The younger generation in particular are accustomed to freedom of choice when it comes to digital solutions, they want to choose themselves. As we step into the future of communication, customers will not be as complacent with poor user experience and services. Telcos need to shake off the cobwebs and move forward into this new era of digital first.
How can telcos make the switch?
It goes without saying that start ups are going to opt for digital because of its efficiency. But what does this mean for large, established telcos and how can they keep up with the competition?
In reality, the only way big telco companies are going to get away from their old legacy infrastructure is to transform existing backend infrastructure - which can take years and cost a lot of money. Sometimes it’s better to build a new house than to renovate something that has been patched together 100 times. It’s faster and it’s cheaper. Most importantly though, it enables telecom providers to launch product offerings tailored to the customers needs, which legacy infrastructure doesn’t allow.
Not only this, launching a challenger brand allows companies to get the new offering operating independently from the old legacy infrastructure which means they can adopt modern, agile processes and hire the right people, with the skill sets needed to scale the business.
Take 02 for example - with the launch of GiffGaff they have been able to offer flexible, affordable plans targeted to a younger demographic. Launching a separate brand gives telcos the freedom to build a brand that’s tailored to the needs of their customers right now, whilst giving them the time needed to restructure their existing infrastructure.
At Telness Tech, we know many telcos are looking to make the same switch - and that’s why we offer a ‘telco in a box’ solution that makes setting up a challenger brand easy. Ditching old legacy infrastructure could take up to three years, but we can get a challenger brand off the ground in just three months.
Telcos adopting digital isn’t a case of if, it’s when - and the sooner this happens, the more hope there is for a bright future in telecoms.
For more information, get in touch with firstname.lastname@example.org