BUSINESS TECHNOLOGY MEDIA COMPANY
Companies
Sectors
Telecoms

Telecoms operators navigate bumpy road during COVID-19

Read time 4min 10sec

Around 75% of surveyed global telecoms operators plan to increase their digital transformation investments in 2021; however, one-third do not have a digital implementation roadmap, as they navigate the demand posed by the pandemic.

This is according to the Road to Digital report compiled by European-based Technology Innovation Council, commissioned by mobile technology company Upstream.

The survey is based on responses and additional data from 56 global mobile operators, which includes 11 African telcos. The report provides an analysis of how operators are walking the road to digital so far, and how they are adapting for 2021 and beyond, to create value and enhance top line growth during the COVID-19 crisis.

The report notes that as the pandemic accelerates organisations’ digitalisation initiatives, operators across markets have also increased their digital investments, with the aim to increase revenue, cost reduction, improved customer experience and revenue growth.

However, it points out that almost one-third do not have a digital roadmap for their own digital transformation journey and only one in four have established by what metrics (KPIs) they are to measure their own success – pointing to a gap between top line strategy and tactical digital project deployment.

It also found that three out of four respondents still rely on physical stores and call centres for most of their revenue, with these still being the dominant distribution channels for the operators.

“During the pandemic, telecom operators worldwide worked around the clock to meet a never-before demand for connectivity in order to keep economies going and allow work-from-home for whole industries,” says Upstream CEO Dimitris Maniatis.

“At the same time, they supported access to critical health information, distance learning as well as offered online entertainment. This has caused them to step up their own efforts to become more digital, bringing their more mid- to long-term plans forward.”

The report notes that surveyed operators identified the following as the top five benefits to their business from digital transformation, in this order: cost reduction via automation (66%), improved customer experience (59%), improved revenue growth (46%), efficiencies through automation and more effective marketing.

At the same time, the surveyed telcos’ top five perceived challenges for turning to digital are: integrating new solutions with existing technologies and platforms (73%), privacy and data concerns (54%), cost of new solutions (46%), establishing the return on investment (43%) and, lastly, internal skillset (34%), or rather the lack of it.

“These are totally legitimate concerns. For instance, how can you improve customer experience by going online, when you still haven’t figured out how to make online transactions safe? To succeed in creating value from digitalisation and fast, telcos need to indeed balance a fine line, overcome the big organisation inertia, escape the drawing board and aim for smart quick wins and solutions,” adds Maniatis.

One in four telcos have KPIs to measure digital transformation success.
One in four telcos have KPIs to measure digital transformation success.

E-commerce sales

According to the Road to Digital report, the evident disconnect between telco digital strategies and action also manifests in the chief reliance of operators on physical channels for their revenue.

During a year with enforced lockdowns and closure of physical stores, telecom operators did go online to sell their products. However, more than 70% of them say they still generate revenue predominantly from physical stores and call centres.

“There is a quick win to be made from telcos’ online sales channels. They are less costly than stores and call centres, have proven higher success rates and allow more accurate targeting than physical channels. The consumers are already online; some will never return to close-up transactions, as they did before the pandemic,” notes the report.

The pandemic has prompted a record number of consumers across the globe to shop online, with research showing a 50% year-on-year increase in the 2020 holiday period.

Making the case for switching to digital sales channels, the report cites the capability of telcos to use multiple channels for any given customer-reaching campaign − SMS, rich communication services, e-mail, push notifications, etc − as a key upside.

Campaigns can be proactive and customisable while analytics and testing allow digital customer journeys to constantly improve.

“Telcos have already started to employ data to strengthen and grow their customer base with digital sales, using it for upselling and cross-selling to their existing customers (66%), as well as to acquire new ones (55%) digitally. Around half of them (52%) say they have already discovered the power of targeting and retargeting, an essential tool to connect with your customers, help them make the decision to buy, increase sales and loyalty,” notes the report.


See also