MOBILE MATURITY

As industries move through the different stages of market evolution, success drivers also evolve. Early on, success is driven by innovation and efficient customer acquisition. As an industry matures, operational effectiveness and customer management become more important. And when an industry is in decline, it becomes more critical to focus on pure asset usage.

There's still plenty of money to be made in mobile wireless, and companies can extract profits at every stage of the lifecycle. But many operators are focused only on introductory growth and have yet to hone in on opportunities in the evolving stages of mobile use, such as customer value management.

Mobile operators can collect vast amounts of information about customer usage. Many have spent significantly on CRM systems to ensure they coordinate their customer touch points. And the nature of mobile service means operators have a unique ability to be in constant touch with their customers.

Still, most mobile operators overlook customer value management because they are focused on old success formulas. Also, customer information is often difficult to integrate and interpret. Finding the right patterns in customer data and taking creative action that will increase profits requires analytical abilities that are often in short supply. Then there's the fear factor: Mobile operators are often afraid to take actions that could jeopardize current revenue and profits.

There are many approaches for dealing with a maturing industry, but here are a few imperatives for the mobile world:

Usage stimulation

A substantial portion of mobile customers have low-usage patterns. Offering discounts for off-peak usage can stimulate overall usage and boost revenue and profit.

Migration management

Huge amounts of profit are lost because of unwise migrations (movement of customers from one price plan to another). Migration needs to be systematically managed.

Churn prevention

Significant profit is lost by customer turnover despite churn-prediction models and last-minute “save teams.” Many outbound campaigns are mistargeted. Resources need to be shifted and campaigns tested before rollout.

Coordination with acquisition

New customer acquisition is insufficiently linked with management of the current customer base. Too often, acquisition campaigns intended to lure new customers attract current customers, which destroys profitability.

To correctly manage its own evolution, the mobile industry must leverage its assets to understand customers — and market to them more effectively.

DOSSIER DOMINIC ENDICOTT

Occupation: Partner with management consulting firm DiamondCluster International and head of the firm's telecom practice in North America.

Place of residence: Rockport, Mass.

Current reading: “Russka: The Novel of Russia” by Edward Rutherfurd; too many analysts' reports

Favorite Web site: www.yahoo.com

Next project: Assisting a major operator accelerate profit growth in the midst of escalating competition