The telecommunications industry has been going through different phases of change. Ever since the notion of digital transformation arose, industry experts started calling for adaptation on both technological and business levels. Data is one of the elements that triggered the need for change, notably because of the huge amounts increasingly being generated which required revamped management models and strategies. But it’s not only about management. Data analytics are currently one of the most important pillars of a successful digital transformation.
Amid daunting challenges that came along with all the hype created by the emergence of digital transformation, telcos had to shift their focus towards customer experience and what better way to address customer needs than anticipation based on reliable analytics – known as behavioral analytics.
Behavioral data shows the trends followed by customers while browsing the internet, social media, email sign-ups or any other action on the web. Behavioral analytics examine those actions and generate insights that can predict the regular trends of each customer. Such a process can help telcos retain their customers in a very competitive market, attract new ones and optimize revenues.
The importance of behavioral analytics is undeniable and telcos can benefit the most if they truly embrace artificial intelligence and machine learning which can transform data into great value. A survey commissioned by McKinsey shows that “companies with the greatest overall growth in revenue and earnings receive a significant proportion of that boost from data and analytics. Respondents from these high-performing organizations are three times more likely than others to say their data and analytics initiatives have contributed at least 20% to earnings before interest and taxes (EBIT) over the past three years.”
The responses to the survey showed that high performers have created long term strategies centered on data and analytics. They have also worked on raising awareness among employees and educating them on the data culture.
For telcos to maintain a strong and enduring relationship with their customers, they should adopt a more personalized approach which will allow them to stay competitive. The same survey conducted by McKinsey highlights how data analytics have changed the nature of competition; 47% of respondents confirmed it. Even if the percentage is still relatively low, however, it increased 38% since the previous survey which reflects more interest in data analytics among industry players namely with new competition entering the market. New entrants are relying on analytics in their businesses. Companies are also forging data-related partnerships.
Having the right strategy in place is the key here to succeed. Telcos should alter their strategies and include data analytics as the main driver for productivity and high performance. However, a strong data analytics strategy should go in tandem with the creation of a data culture that can set the adequate foundation. It is important to abide by a set of good practices that can help in creating that culture in the work environment.
One of those practices is to consistently use data in decision-making processes. Having a C-suite data leader can also help in disseminating this culture and guarantees access to data tools to frontline employees. In addition, education certainly plays the most important role here whereby a workforce with data analytics knowledge will certainly make a difference.
All of those steps lead to one objective: ensuring a strong customer relationship. With behavioral analytics, customers will feel that they are understood and telcos will be able to offer more personalized services via the right channels. Analyzing customers’ behavior will also allow telcos to identify issues they might face while using the service and monitor their demand for products. This will expedite action to solve the problem. The challenge here remains to monitor the changes in behaviors and needs that are happening frequently with the rapid technological evolution.
McKinsey’s study cites an important feature of a data-driven culture which is ensuring that the company’s existing technology can actually support leveraging data and analytics. “The high-performing companies are much more likely than their peers to have deployed a modern data architecture. In fact, data architecture is the second-highest-ranked challenge (after strategy) to reaching a company’s data and analytics goals.”
Behavioral analytics are incredibly relevant in a cybersecurity context. Telcos are keen nowadays to strengthen their cybersecurity policies and behavioral analytics are one of the pillars of a solid prevention plan. In fact, a cybersecurity solution based on behavioral analytics monitors users’ behavioral patterns and identifies anomalous network activity or behaviors that are not in conformity with the regular patterns which indicates a potential security breach.
For telcos that haven’t built strong data strategies yet, it is not too late. The first step is to make data available. Decision makers should adopt advanced analytics tools once data is out of silos. An organizational restructure is essential here to allow the rapid sharing of data by building technical infrastructure and leveraging automation. Data has a real return on investment and telcos should act upon it. Revenues, customer satisfaction and high performance are all tied to it therefore it should be managed as such. Furthermore, telcos should focus on evolving their data cultures by educating employees and recruiting new hires who are familiar with the use of data analytics.
Behavioral analytics are based on insights. The most important step here is to translate them into actions. Once telcos start to consider data as their main asset, they will notice an increase in their customers’ satisfaction index which will generate more revenues and help in a highly competitive market that witnesses new entrants every day.