There’s a reason why most people do not change their wireless provider, and it’s not because they’re delighted with the service.
By Tim Deluca-Smith, vice president of Marketing, WDS, A Xerox Company
For mobile telecoms providers (and just about anyone else), the primary weapon for growth actually resides within customer retention, more than it does customer acquisition. Not only is it the most effective method of growth in these conditions, but it’s also the most cost effective. Customer acquisition is way more expensive.
That’s why for mobile operators, churn figures – the numbers of customers who leave — are of keen interest. However, the industry’s reliance on churn as a measure of customer loyalty is misguided. Churn only indicates those customers who have already left; it gives no indication of the loyalty of those that are retained.
This year’s annual Mobile Loyalty Audit by WDS, A Xerox Company, shows that mobile operator customer retention is not the result of loyalty but, in fact, is largely a symptom of customer inertia. Of the 4,000 customers interviewed across U.K., U.S., South Africa and Australia, more than a quarter (26 percent) admits that the only reason they stay with their current provider is that switching is ‘too inconvenient.’ In addition, more than a third (35 percent) simply don’t want to risk changing for fear of losing coverage.
The Mobile Loyalty Audit also underlined a large disparity between customer satisfaction and customer retention. The study shows:
- Almost one fifth (18 percent) of customers who are considering switching, also admitted to being highly satisfied with their current provider.
- Less than half of retained customers (44 percent) are highly satisfied.
These findings reveal that mobile subscribers are simply not loyal. In fact, subscribers for the most part feel unloved and display low levels of trust towards their operators. Efforts to increase customer retention and brand loyalty are, for the most part, ineffective.
Find out more about how customers really feel toward their mobile operator and smartphone manufacturer in this year’s audit, available for free download. Just fill in your details and follow the prompts.
