Reducing Churn by Applying Analytics Could Gain Mobile Operators $4B by 2018

Juniper Research provides research and analytical services to the global hi-tech communications sector, providing consultancy, analyst reports and industry commentary. It recently released the results of a report entitled “Mobile Analytics & Big Data Strategies for MNOs, Brands and OTTs 2013-2018.”

This report found that Mobile Operators worldwide are set to gain from a significant reduction in churn through the adoption of big data and analytics techniques. The gain would be equivalent to an increase in revenues of almost $4 billion a year by 2018.

Churn rate is defined in its broadest sense as a measure of the number of individuals or items moving out of a collective over a specific period of time. It is one of two primary factors that determine the steady-state level of customers a business will support. The term is most widely applied in business with respect to a contractual customer base.

Through the use of analytics platforms, operators can anticipate the likelihood of customers to churn. This in turn allows them to take preventative action with a result of reducing revenue loss. Analytics identifies priority users. According to Juniper’s report, a number of leading network operators have already seen significant reductions in consumer churn levels following the implementation of analytics platforms.

The author of the report is Keith Breed. In the report, he says, “Although the scope for churn reduction varies by country and by operator MNOs with high numbers of Pre Pay subscribers are likely to realize the greatest benefits. By gaining control of structured and unstructured customer data for the first time, operators in emerging markets can gain far greater consumer insight than was previously the case.”

Some of the other findings from the report show that analytics will generate almost $9 billion of savings and incremental revenues worldwide for mobile operators by 2018. In addition, over-the-top (OTT) players and digital content providers need to deploy analytics solutions to improve customer segmentation. This can increase targeting and upselling opportunities.

The report also found that, while churn reduction was the primary benefit for operators in emerging markets, players in more developed markets such as C Spire Wireless in the U.S. are coupling analytics more with a customer loyalty program to improve user retention.