Data Analytics: The Key to KPI Analysis in Telecoms

Data analytics shows the truth about what’s really happening in your Telecoms company.

While the truth may not always be what companies wish to see, it does enable them to blast competitors out of the water.

Data analytics provides the backbone for continual improvements, and this, in turn, drives an increase in profit.

Data analytics passes human agenda, perception and fickleness to provide the truth about customers, and enables Telecoms to:

• Understand their customers across all products and services and optimise interactions
• Enhance every customer interaction
• Analyse customer behaviour and make predictions in order to increase retention and revenue
• Keep highest-value customers by developing offers which appeal to them specifically
• Increase the effectiveness of segment targeted marketing campaigns

In the age of high competition, can your Telecoms business do without data analytics?

In this article, we’ll address data analytics specific to KPI analysis.

Benefits of data analytics

• Increase sales
• Increase customer retention
• Reduce fraud
• Improve risk management
• Decrease operational cost
• Improve operations, streamline processes and stay on top of industry trends
• Predict forecasts
• Cross-sell, up-sell products and service
• Analyse customer loyalty and behaviour to drive marketing and sales processes
• Build predictive models

Data analytics for KPI’s

Data analytics helps decipher what is working and what is not working in each department, essential for monitoring KPIs.

For example, a company can track how long it takes for staff to deliver parcels to clients and if the correct tracking software is installed in their vehicles they can monitor them to make sure they are delivering on time and also saving fuel.

Leading Telecoms in South East Asia use data analytics to improve the effectiveness of their marketing promotions by 600%. Marketing staff are measured on the metrics which determine success.

Defining KPIs

Choosing the right KPIs is crucial to achieving the Telecoms company’s vision and mission through the daily tasks of employees.

Selecting the right KPIs empowers employees to meet meaningful goals, but select the wrong metrics and that can mean a waste of time, resources and money.

The right things need to be measured, not all things. The focus must be maintained.  

It requires a precise definition of the goal and what success entails.

To establish the right KPIs, Telecoms companies need to determine which metrics most clearly resonate with the company’s goals.

Metrics most important to Telecoms

In the Telecoms industry, there are certain KPIs that are more important than others:

Accessibility

This tracks if users can access a service they requested and the quality of being available when needed.

Retainability

Measures if the network is able to hold and provide the service for the users. Call drop rates are tracked here.

Mobility

Measures the performance of the network during the movement of users.

Integrity

Measures the honesty of the network to its users.

Availability

Tracks if the network is suitable or ready for users to use its services.

Utilization

Tracks whether the network has reached capacity.

Average return per user

Tracks how much money the MNO is making for each person using its service.

Subscriber acquisition cost

Tracks how much money is spent to acquire new subscribers. Costs such as marketing, advertising, sales commissions and costs to put customers on your network are tracked here.

Churn

This tracks user turnover. If your company is losing customers, you need to look at acquiring new customers and also look at your service and your costs (i.e. the root cause of what’s making customers leave in order to fix it).

McKinsey reports that a “comprehensive, analytics-driven approach to base management can help Telecom companies reduce churn by as much as 15%”.

Network operating cost

This tracks how much your network costs to operate. Important for MNO’s that are just starting out and also for existing networks to make sure costs don’t escalate.

Net Promoter Score

Net Promoter Score is a key metric of MNOs to gauge the health of customer relationships. It’s an alternative to customer satisfaction research. Many companies have now adopted it.

NPS is calculated on the responses to one question: ‘’How likely is it that you would recommend our company/product/service to a friend or colleague?’’ The scoring is normally based on a 0 to 10 scale.

Scores of 9 to 10 are seen as promoters. They might buy more, remain customers and recommend your company.

Scores of 0 to 6 are seen as detractors. They are seen to be less likely to exhibit value-creating behaviours.

Responses of 7 to 8 are seen as passives. They fall between promoters and detractors. The NPS is calculated by subtracting the percentage of customers who are detractors from the percentage of customers who are promoters.

It is suggested that customers be asked their reasoning for giving a specific score, and this valuable information is then passed on to the company who can contact the client to work on possible solutions. In addition, the feedback helps to know which staff training is necessary.