Big Data Monetization In Telecoms: 4 Key Strategies
A video is responsible for more than two-thirds of network traffic today.
While most telecoms operators are already aware of this, very few question predictions that video will account for more than 80% of connectivity within five years.
And they certainly don’t understand it’s growth, nor how it impacts their networks. In five years time, will South African telecoms be prepared for the impact of 80% of their traffic arising out of a need to consume video?
More importantly, are companies building strategies to leverage that forecast?
Although big data monetization in telecoms is in its infant stages, McKinsey reports that the top performers are more conscious about monetizing their data and using data for enhanced value to customers and the business, adding new services, building new business models, and offering data-based services or products.
Big data monetization in telecoms amplifies segment targeted marketing initiatives which can only mean increased profit.
How can MNOs monetize big data?
Detailed information about customer behaviour can increase profits or cut losses.
Big data provides meaningful insights into your customers; examples include:
- Dropped calls are one of the major reasons why customers leave your network. If you can understand why the business can implement preventative measures.
- If you find a trend of customers complaining about connection problems, you can use big data to a) analyse root causes and b) use the root causes to upsell or create new services.
Big data monetisation in telecoms
Monetisation strategies for big data are split two-ways: internal and external. Internal strategies are designed to improve business operations while external strategies are developed to increase profits.
Let’s take a look at them in more detail:
Internal monetization strategies
- Improving customer service. Monitoring call drop rates and customer service issues. If handled correctly and quickly, this can reduce churn rates.
- More effective marketing and sales. Big data mining provides knowledge around better ways of marketing and sales as well as tracking what services clients are using and buying more of, allowing telecoms to tailor-make offers to clients.
- Prevent fraud. Big data allows companies to analyse precisely where money is going and what staff are doing. This cuts out fraudulent activities.
- Big data is ideal for R&D. It can forecast where companies should invest their money. It’s ideal for expansion.
External monetization strategies
- Foot traffic in malls. MNO’s can provide malls with insights about foot traffic to more effectively plan marketing and sales requirements.
- Stadiums that host events. Offering foot traffic and crowd movement data can help stadiums avoid traffic jams. As the Internet of Things and 5G are used more, this will assist stadiums and cities immensely. These become new target markets for MNO’s.
- Business Intelligence. When enough data is gathered, companies can look at tailor-making products that other companies might want to buy based on this data.
- Advanced analytics. Big data can be used as a valuable analytics tool in other industries.
4 Key strategies for future big data monetisation
What do telecoms need to maximise their data and monetise it?
1: Decision making
Big data allows telecommunications to make smart business decisions, and has proven to have an impact on these areas specifically:
- Infrastructure and network congestion strategies
- Segment targeted marketing and advertising
- Geographically-based services
- Operational efficiency
- Customer experience
Before making any investments, it is essential to make a decision as to how to utilise big data. Start small and test first. As your systems are perfected and monetised, move on to other areas.
2: Understand what competitors are doing
Use big data to give you a competitive advantage. Although many telecommunications companies are aware of industry trends, they are not utilising them to maximise revenue.
Indeed, a McKinsey report states that “Mobile data usage is booming, but revenues from digital traffic are not.” This is proof that although big data monetisation in telecoms presents a competitive opportunity, the majority of MNOs are not taking it up.
Not only will analytics provide the weaponry to push competitors away, but it also provides insight into what competitors are doing, which you can use.
3: Analytics technology: choose well
To transform data into meaningful decisions, you need the right analytics technology, preferably focused on the specific needs of telecoms. The results have the potential to significantly improve various dimensions of your operations, to:
- Go beyond the normal data
- Initiative creative modelling
- Translate outcomes
- Provide better ways of doing things
Do your research to find the right tool based on company vision and mission and essentially, overall strategy. The tool must match your strategy instead of the other way around.
4: Specialist team
Gartner predicts that by 2020, only “50% of chief analytics officers will have successfully created a narrative that links financial objectives to business intelligence and analytics
initiatives and investments.”
In addition, there are risks to big data, for example, companies not knowing what kind of data they collect and how to handle it for compliance. Then there is the ethical and security issue of data and consequences of inaccuracy. The problem many businesses face is having the data but not knowing what to do with it, and especially not knowing how to monetise it.
Big data monetisation in telecoms takes time and requires specialised knowledge. It begs for a dedicated team of data scientists to build and automate systems, and this could be the reason why so many telecoms companies are not monetising their data as yet.
Experienced Executive with a demonstrated history of working in the information technology and services industry. Strong sales professional, skilled in Marketing Management, Negotiation, Business Planning, Operations Management, and Sales.