Global mobile subscribers, particularly in mature markets, want more transparency when it comes to contract terms, rate structures and data fees from mobile networks. Customers who are confused by different mobile phone packages will often choose easy-to-understand terms and conditions over price.
This is according to Nokia's tenth Acquisition and Retention Study, which examines the main reasons why mobile customers select and leave operators. The study revealed while price is still the most important factor when it comes to customer acquisition and retention, transparency regarding the contract plans and rate structures was 14% more important to respondents than in 2014.
More than 20 000 mobile phone users in mature and transition markets were surveyed for the study. A further 140 telephone interviews with 140 consumers and 28 operators took place. Results were also based on bespoke research to contextualise responses, says Nokia.
The five factors which played a significant role in customers deciding to switch service providers or to remain faithful, says Nokia, were cost and billing, network quality, customer care and service and device portfolio.
Respondents said customer care had 60% more impact on their loyalty than it did in 2014, indicating the biggest change in the study.
Bhaskar Gorti, applications and analytics president at Nokia, says customer care is now on a par with network quality as a deciding factor to stay with a mobile provider.
"We can see the marketing battles to acquire mobile subscribers are fierce. What we don't see as well is the work operators do every day to retain customers. Our study shows how important that work is - and also how challenging it is as customers, attached to their phones, demand higher levels of service."
"Respondents say better general services, self-service capabilities and effective complaint handling are increasingly becoming important to them," adds Gorti.
Switching service providers
Steven Ambrose, ICT analyst and CEO of Strategy Worx, says the main factors that contribute to customers churning on their service providers are price, network performance and value, such as promotions.
"Over 85% of contract subscribers are happy and don't leave. Contract churn on all networks is below 10%.
"However prepaid subscriber churn is at least three to four times that of contracts at over 35% on average across the networks. This churn can be as high as 57% on some networks, the reasons are often complex but can be boiled down to the fact that there is fairly intense competition at the lower end of the prepaid market," he asserts.
Discussing the impact of mobile number portability (MNP), Ambrose says the service has not been very significant.
"The current figures show an annual MNP rate of only a few percent, around 4% of the total active sims. This is because most people on contract, despite their vociferous complaints, do not move networks very often", he reveals.
Antony Seeff, CEO of cellphone bill-optimisation company Tariffic, says SA's cellular consumers' priorities are centred on the three s's, which are signal, service, and savings.
"South Africans would look to move cellphone operators if they aren't receiving adequate signal to be able to make phone calls; the service they receive from their operator isn't up to scratch; or if they could save more money by moving to another operator.
"It appears that it is nearly impossible for South African operators to consistently satisfy their user base with all aspects of the three s's. An operator may offer great signal but be more expensive, or be more affordable but not provide the level of service you may expect," he elaborates.
Although Tariffic can save customers up to 40% on their cellphone bills if they moved to the network, many customers prefer to stay with "the devil they know" and save a lesser amount with their current operator, he notes.
Nokia found networks are getting better in mature markets, but there is work to do in transition markets. "Consumers in mature markets report a 13 percentage-point improvement in their satisfaction with Internet connection quality vs 2014, while transition markets report a slight decline," says the study.
Nokia further pointed out mobile security is a growing issue: 90% of customers in mature markets and 94% in transition markets worry about mobile security. Globally, 47% of respondents would change operators if they suffered a security breach.
Another important growing issue was consumer expectations about IOT, 56% of respondents in mature markets and 82% in transition markets would like to control at least one device via their mobile phone or tablet.
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