Opinion : Telcos Need to Answer the Call


Telcos risk shrinking retail revenue if they don’t shift sales models to capitalize on demand for in-store, highly personalized customer experiences

The physical retail channel plays an important role in telecommunications sales. According to recent research from Accenture Strategy.

For telcos, the strategy to expand their physical footprints makes sense, but only if they use their stores to their full potential – currently they don’t. Compared to other retailers, telcos tend to underperform. On a per-square-foot basis, Apple generates more than 10-times the sales revenue of the average U.S. telco. Sales figures for Best Buy are roughly twice as high. If telcos’ retail operations competed directly with similar players outside their business, very few would survive.

Barriers to reaching their retail potential

One of the key barriers preventing telcos from reaching their retail potential is they aren’t selling what customers want to buy. In the digital age, telco customers want and value engaging experiences at every point of interaction. This is where telcos typically stumble. Rather than create the highly personalized and connected experiences customers crave, telco stores primarily focus on selling phones and accessories, and offering customers services such as upgrading and renewing contracts. All of which create transactional customer relationships.

Another barrier is that many telcos segment their in-store customer base according to traffic volume – not according to the bottom-line contribution that digitally connected customers can potentially deliver. This one-size-fits-most sales strategy assumes that all customers want the same thing, and it can have a significant impact on sales.

A new customer reality

Today, 83% of consumers initiate the purchasing process before they even enter a store. They conduct research and evaluate offers online, where a growing number of digital and social connections can influence their preferences and decisions. With a clear understanding of the contract, device and accessories they want before walking into a store, many store associates can offer customers little additional value.

To build meaningful relationships and give customers the value they expect, telcos need to inject themselves more meaningfully into their customers’ digitally enabled shopping process. By understanding distinct customer profiles and delivering personalized experiences and offers, telcos can entice customers to embrace new digital opportunities. To do so, they need people with the skills to act as advisers, guides and influencers. They also need store managers to be coaches, encouraging their teams to provide higher-value experiences and incentivizing them to deliver.

Delivering highly connected digital experiences

Telcos that reinvent the in-store experience for the digital age can grow sales in three ways. First, by offering engaging experiences, which encourage more customer spending. Half of telco customers are willing to pay more for a valuable experience. Second, they encourage customer loyalty and greater lifetime value; 80% of customers are interested in proposals for additional telco products and services. And third, they generate new sales by increasing the likelihood that satisfied customers will refer others.

Telcos can rethink their in-store sales operations to deliver the digitally connected experiences customers crave and increase revenue by:

Making digital personal
Physical sales channels cannot exist in isolation. Because retail stores act as a conduit to digital experiences (and vice versa), it’s important that telcos collaborate and share information across channels. Store staff need access to customer data to feel empowered to offer personalized advice based on a customer’s history and seamlessly continue interactions customers may have started online.

Telcos can use a number of tools to help bridge physical and digital retail experiences. Using online appointment schedulers to personalize customer visits can help. Customers book in-store appointments online at a time that suits them. Sales associates greet them by name and are ready to serve them when they arrive. The tool is effective at saving time, it empowers the consumer and boosts loyalty.

Connecting customer insights
Telcos possess a huge amount of customer data. However, many don’t use it as well as they could to improve the sales and service experience, and entice customers with new offerings. By analyzing the information that customers share through their various interactions, telcos can gain valuable insights about who their customers are and what they want. By combing through the data, they can segment customers and establish distinct experience profiles.

Understanding which customers are gamers, athletes or digital pioneers, for example, makes it easier for telcos to identify cross- and up-sell opportunities, and deliver new experiences.

Bridging sales and service
Customer service is an integral part of sales. If consumers have a bad customer service experience, more than three quarters will tell others. Poor service is a cause of customer defection and can impact the acquisition of future customers. By improving service, telcos can reduce churn, deliver more valuable and distinguishing experiences, and seize prime sales opportunities.

Refreshing sales incentives

Telcos need to abandon incentive programs that are aligned to old sales models. Commissions that have traditionally been based on sales of devices and accessories should reflect the new selling context. Sales reps should be rewarded for monetizing customer engagement, essentially reinforcing the sales behaviors that influence customers’ purchasing decisions.

There continues to be an important place for physical retail channels in the telco go-to-market model. But in the digital age, telcos can no longer act like traditional retailers. They need to become trusted guides in an expanding digital world, and conveyors of the connected and personalized multichannel experience.


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