Escolar Documentos
Profissional Documentos
Cultura Documentos
Project Research by
SATISH SINGH
TABLE OF CONTENTS
INTRODUCTION
• Vision
• Mission
• Quality Statement
• Corporate Asset Focus
• Share Holding
ABOUT BHARTI
• Selecting And Measuring The Right Components For A Successful CRM Strategy
• Best Practices For Analytical Applications In The Telecom Industry
• Strategies Adopted
• Technology From World Leaders
• Service Guarantee
• Value Added Services
• World Class Customer Care
• International Significance
• Competitive Strengths
• Awards
• The Road Ahead
REVIEW OF LITERATURE
• Customer Relationship Management
• The Emergence Of CRM Practice
• A CRM Process Framework
RATIONALE
RESEARCH METHODOLOGY
• Data Collection Instruments
• Collection Of Data
CRM STRATEGY
• Managing Customers For Various Enhancement
• Once CRM Is Implemented, What Makes It Click
• Because Good Relations Matter
• CRM Reference Model
• Touch Point And Presentation Layer
• Distributed Application And Security Cooperation Services
• IT Service Management
• Technology Network Infrastructure- IT
• Tools
CRM ACQUISITION
• Steps
• Strategies
• Other Means
• Customer Defection
• 6 Types Of Defectors
CUSTOMER RETENTION
• Customer Complaints
• Need To Listen To Customer Complaints
• Encourage Customer Complaints
• Do Not Forget
INDICES
• Marketing
• Sales
• Customer Service
• CRM Business Strategy
CONCLUSION
BIBLIOGRAPHY
INTRODUCTION
AIRTEL comes to you from Bharti Cellular Limited - a part of the biggest private
integrated telecom conglomerate, Bharti Enterprises. Bharti provides a range of telecom
services, which include Cellular, Basic, Internet and recently introduced National Long
Distance. Bharti also manufactures and exports telephone terminals and cordless phones.
Apart from being the largest manufacturer of telephone instruments in India, it is also the
first company to export its products to the USA. Bharti is the leading cellular service
provider, with a footprint in 21 states covering all four metros and more than 8 million
satisfied customers.
VISION
To be globally admired for telecom services that delight customers.
MISSION
We will meet global standards for telecom services that delight customers through:
Empowered Employees
Innovative Services
Cost Efficiency
The strategic objective is to consolidate its leadership position among mobile service
providers in India. Through its subsidiaries, Bharti has licenses to provide GSM services
in 15 of the 22 telecom circles in the country. It now proposes to consolidate all these
subsidiaries under Bharti Cellular.
QUALITY STATEMENT
We will deliver error-free services to our customers by doing our jobs right the first time,
every time - this is your quality statement.
CORPORATE ASSET FOCUS
The Chairman and Group Managing Director of Bharti Televentures, Mr Sunil Mittal, has
sold his entire personal stock, accounting for about 0.15 per cent stake in the company, or
a consideration of over Rs 60 crore on New Delhi, March 11.
Share Holding
FIIs/GDR : 9.2%
Shareholders : 40,315
ABOUT BHARTI
Bharti Tele-Ventures Limited was incorporated on July 7, 1995 for promoting
investments in telecommunications services. Its subsidiaries operate telecom services
across India. Bharti Tele-Ventures is India's leading private sector provider of
telecommunications services based on a strong customer base consisting of
approximately 11.50 million total customers which constitute, approximately 10.66
million mobile and approximately 836,000 fixed line customers, as of February 28, 2005.
The company today offers mobile services in 21 out of 23 circles in India. The company
also provides fixed - line services and Internet access over DSL in 6 circles. The
company complements its mobile and fixed-line services with national and international
long distance services. The company also has a submarine cable landing station at
Chennai, which connects the submarine cable connecting Chennai and Singapore. The
company provides reliable end-to-end data and enterprise services to the corporate
customers by leveraging its nationwide fiber optic backbone, last mile connectivity in
fixed-line and mobile circles, VSATs, ISP and international bandwidth access through
the gateways and landing station.
In September 2002, Bharti leveraged its pan-India footprint to offer some never before
benefits to our customers. These succeeded in re-defining customer expectations and are
fuelling growth of the mobile category in the Western region. The benefits included a 30-
second pulse, free roaming on Airtel networks across the country, incoming calls free
from any Airtel to Airtel mobile and free airtime on one international, one national and
one local number without any monthly charges. Bharti Cellular has invested Rs 1500
crores in the Western region. This investment is to be raised further as the roll out gathers
more momentum.
Targeted acquisition
STRATEGIES ADOPTED
Focus on maximizing revenues and margins;
Position itself to tap data transmission opportunities and offer advanced mobile
data services;
SERVICE GUARANTEE
Service guarantee is a first-of-its-kind scheme and underlines Airtel’s commitment to
provide error free services – ‘Services right the first time and every time’. The service
guarantee scheme entails:
INTERNATIONAL SIGNIFICANCE
There are *38 mobile operators worldwide, who have 10 million plus customers. Within
this Group 38, there are 15 mobile operators who are from Asia. In this regard, it is a
proud moment for the Indian GSM industry with Airtel becoming the first Indian GSM
operator to join this international club as its 39th member worldwide and the 16th in Asia.
The key demographics of Bharti Tele-Ventures' mobile circles are set forth below
Bharti Bharti as
All India
Circles % of All India
Number of circles 22 16 73%
Area of the circles (in '000 sq km) 3,278 1,848 56%
Population in the licensed areas (in Millions) 1,027 593 58%
Market Mobile subscribers in the licensed areas
39.78 39.42 99%
(in Millions)
Market Dealers in the licensed area (in Millions) 37.7 30.7 81%
Number of vehicles in the licensed areas 36,132 29,025 80%
COMPETITIVE STRENGTHS
Bharti Tele-Ventures believes that the following elements will contribute to the
Company's success as an integrated telecommunication services provider in India and
will provide the Company with a solid foundation to execute its business strategy:
The strong brand name recognition and a reputation for offering high quality
service to its customers;
Quality management team with vision and proven execution skills; and
Existing foreign shareholders have acquired direct and indirect equity interests in the
Company for a total consideration exceeding US$1 billion.
First off the block to launch fixed-line services in all the four circles of Delhi,
Haryana, Karnataka & Tamil Nadu.
AWARDS
Bharti Tele-Ventures, its subsidiaries and management have received several awards and
recognitions, including:
Bharti was recognized as one of the "Leading Lights of Telecom" in Asia in November
2001 in the Asian edition of the "tele.com" magazine with analytical inputs from research
consultants Frost & Sullivan.
Golden Peacock National Training Award – 1999 to Bharti Cellular for our Delhi
mobile operations from the Institute of Directors, a non-profit association in India
committed to improving the competitiveness of Indian business by focusing on
development of business leaders, for the best human resources and training practices;
and
Ascent – Times of India and Sodexho Pass award in 1999 from the Asia Pacific HRD
conclave to Bharti Cellular for corporate excellence in the category of most
innovative human resource practices.
Mr. Sunil Bharti Mittal (Chairman and Group Managing Director) was honored as
“One of the Top Entrepreneurs Worldwide" for the year 2000 and "Stars of Asia" for
the year 2001 by international business magazine, Business Week.
Mr Sunil Bharti Mittal was selected as the "Businessman of the year 2002" by
Business India.
Mr Sunil Bharti Mittal was awarded the “Dataquest IT man of the year 2002”.
Mr Sunil Bharti Mittal was selected the "CEO of the year 2002" by World HRD
congress.
Mr. Akhil Gupta (Joint Managing Director) was adjudged as the Chief Financial
Officer for year 2001 for Mergers & Acquisitions activities by EIU.
On October 12, 2004 Airtel – India’s leading mobile service provider and a part of
India’s largest telecom conglomerate Bharti Enterprises had been adjudged as the
“World Communications Best Brand of the Year.
REVIEW OF LITERATURE
Team Structure
Purpose
- Increase Effectiveness
- Improve Efficiency
Role Specification
Planning Process
Programs
- Account Management Relationship Performance
- Retention Marketing Process Alignment - Strategic
- Co-op Agreements - Financial
- Strategic Partnerships - Marketing
Monitoring Process - Retention
- Satisfaction
- Loyalty
Communication
Partners
- Criteria
- Process Employee Motivation
Employee Training
Evolution
- Enhancement
- Improvement
• Co-development
Primary objective:
To study and analyze the Customer Relationship Management Initiatives at Airtel.
Secondary objective:
The secondary objective of my study was to recommend strategy to ensure achievement
of prescribed parameters. These parameters are:
1) All request for services come to Air Tel.
2) Requests received are updated or activated on time.
3) Errors free updation.
The first parameter is almost clear that near about all the requests from activation come to
the Airtel.
The second parameter states customers are activated on time.
The third parameter states that customers are provided only that service which they opted.
Therefore the basic purpose or objective of my project work was to ensure these above
mentioned parameters at the dealer’s level, which is possible through the careful
understanding of the business done by them, their way or style of working, the problems
they are facing, loyalty towards the company and their level of satisfaction.
The first parameter i.e. all the services should come to Air Tel is basically related to the
dealer’s satisfaction and the customer requirement. This is because if the dealers are
satisfied with the company they will give business to it and also if the company provides
services according to the customer requirements the business will definitely come to
them. Lot more depends on the customer service provided by the company.
The second and third parameters i.e. timely activation and error free updation requires
understanding of the relationships between the dealers and the franchisees, their attitude
towards the customers and franchisees, the way activation’s are made and attention paid
while filling out the CAF.
Rationale
The customer is QUEEN. This millennium comes with new dreams, hopes, and
aspiration. It heralds the emergence of new business paradigms that will keep pace with a
world rapid changing under the impact of development in InfoTech and communications
technologies. It touches the lives of individual all over the world. With the growing
competition in Indian economy, virtually every company finds itself struggling for
survival today.
Today it is the consumer who delivers the final verdict. A consumer who is finicky about
what she wants. An important development in the consumer market is the emergence of
the newer younger consumer. This consumer is more open to trying new products but she
is more demanding and fickle in terms of brand loyalty. I believe smart Companies across
the country are no longer talking about product or service quality rather successful brand
will need to establish more meaningful and intimate relationship and delight their
customers.
The major application of CRM is in industrial good markets and service markets. For
relationship to start individual identifiable customers have to surface from the statistical
mass of a target segment and for this to happen on a big scale technological
transformation of the market place and the transaction are essential prerequisites.
In this millennium: the old rule will change. It will not be the big company who will
swallow the small but the fast that will out pace the slow. Success will lie in becoming a
part of the customer's life.
Ultimately, it is the firm’s advantage to develop long term relationships with existing
customers because it is easier and less expensive to make an additional sale to an existing
customer than to make a new sale to a new customer. However, the effort involved for
the firm in developing and maintaining a customer relationship must be weighted agent
the expected long term benefits. Marketers must determine the ‘life time value’ of a
customer to ensure that the costs of obtaining, servicing and communication with the
customer do not exceed the potential profit. Ultimately relationship marketing involves
more than locking - in customers to a particular supplier through price, rewards or even
the high cost of change (coercive model of relationship benefits). Recent research shows
that a successful, long term relationship also requires commitment and trust, which are
based on clean benefits, shared values and effective communication.
Thus the key to company’s success does not lie with in its walls and under its ceiling, in
the offices of its vender, or the homes of its employees. It lies in the mind of the
customer, whose decision will determine whether you will post a turn over, make profits,
and live long or not.
RESEARCH METHODOLOGY
Research is common parlance refers to a search for knowledge. According to
the advanced learner’s dictionary of current English, research means “a careful
investigation or inquiry especially through search for new facts in any branch
of knowledge”.
Research is, thus, an original contribution to the existing stock of knowledge
through objective and systematic method of findings. Thus, the term ‘research’
refers to the systematic method consisting of enunciating the problem,
formulating a hypothesis, collecting the facts or data, analyzing the facts and
reaching certain conclusions either in the form of solution(s) towards the
concerned problem or in certain generalizations for some theoretical
formulation.
The final stage consisted of analysis and interpretation of all the collected data. The
issues raised in the primary research were critically examined, followed by some
recommendations, which could enhance the industries potential
FINDINGS AND ANALYSIS
Manager’s orientations
Co-operation/Integration
Costs/prevention/results
DEALER SURVEY
25
20
15 No. of dealers
10 percentage
5
0 %
0%
0%
0%
%
00
20
-4
-6
-8
-1
0-
20
60
40
80
This chart show that sixty-percent dealers fall under the category 80-100% of the
percentage of business whereas fourty dealers are below that category which is quiet a
substantial figure and should be carefully dealt with.
3
airtel Leisure
30
Airtel Business
30
Airtel Standard
From the chart, it is clear that the most popular service Among the customers is air tel
standard and airtel business becouse of their convenient tariff rates. However, each
service is suitable for specific class of people depending on their usage.
2. How would you rate Air Tel’s network in your area?
Table-3
no. of dealers
Excellecnt
10
good
20
3 Needs
Improvement
The chart depicts that thirty percent dealers are not fully satisfied with the netwok. They
nelieve that there is scope for improvement as the signals are sometimes not proper in the
interiors. Sometimes even inside trhe house or shop signals get weak.
3. How knowledgeable is company’s customer service people?
Table – 4
Graph -5
Excellecnt
very good
18% 0%
so-so
Dis-satisfied
82%
Strongly
dissatisfied
This chart shows that all the dealers are satisfied with the knowledge of the customer
service people of Airtel. They understand their problems and give them a reasonable
solution.
4. When phoning at the customer care department how quickly is the call transferred
to the customer care executives?
Table – 5
Graph - 4
Immediately
0% 9% Within few
minutes (2-3
min)
takes time
91%
Most of the dealers i.e. near about 90% have the problem that when they make a call to
the computerized customer care department it takes long time near about 5-10 minutes
for their call to be transferred to the customer care executives.
5. How responsive are the customer care executives in returning the phone calls.
Table – 6
Graph-6 Excellent
3%
Very Good
6%
0%
15% So-So
Dissatisfied
76%
Strongly
dissatisfied
Here most of the dealers are satisfied with the responsiveness of customer care executive
in calling back to them if proper solution was not available for the first time.
6. Dealer’s overall rating to the customer care department.
Table – 7
20
15 No. of dealers
10
5 Percentage (%)
0
dissatisfied
Excellent
So-So
Strongly
As shown above nearly thirty-six percent dealers have low level of satisfied with the
department that leaves much needed scope for improvement.
7. Dealer’s rating to the usefulness of sales representatives visits to them.
Table –8
12
10
8 No. of dealers
6
4 Percentage (%)
2
0
nt
d
o
od
...
ie
lle
-S
ly
Go
isf
So
ce
ng
at
Ex
ry
ro
ss
Ve
St
Di
The above chart clearly indicates that a substantial percentage of dealers (27%) have a
low level of satisfaction with the company representatives to them. Also 21 percent
dealers are not at all satisfied with them.
8. Dealers rating of the schemes provided by the company for them.
Table – 9
Dissatisfied
12
Strongly
dissatisfied
Strongly dissatisfied
From the chart, it is clear that the dealers are not satisfied with the schemes provided by
the company. They have the complaint that thought the customers are benefited from the
various schemes there are not many schemes for their benefit. Sometimes the schemes are
communicated to them slightly late and thus them the benefits from them.
9. Dealer’s satisfaction with the margins or cut-off provided by the company.
Table – 10
14
12
10 No. of dealers
8
6 Percentage (%)
4
2
0
nt
ng d
d
sa 0
...
ie
oo
lle
-S
ly
St isf
G
So
ce
t
y
Ex
er
ro
is
V
The above chart indicates that near about fifty percent dealers are not much satisfied with
the margins given by the company. The possible reason for this is the frequent
fluctuations in them. Many times they get less than what is assured.
10. Classification of dealers according to the number of activation’s (average) made
in a month. (on the basis of question II)
Table – 11
12
10
8 No. of dealers
6
4 Percentage(%)
2
0
ve
ct
0
0
0
-4
-3
o
-1
-O
b
0
0
0
a
0
3
2
0
4
20-30_10_30.30_
30-40_Level of Satisfaction
No. of dealers
Percentage (%)
Excellent
6
18.18%
Very Good
12
36.37%
So-S0
11
33.33%
Dissatisfied
4
12.12%
Strongly dissatisfied
0
0%
7_21.21_
40 above_5_15.15_
12
10
8 No.ofdealers
6
4 Percentage(%)
2
e
0
v
t
0
c
0
o
-3
-4
-O
-1
b
0
a
0
3
2
0
4
Here the dealers are classified according to the number of activations they made in a
month. From the table and chart it is clear that they are uniformly distributed across the
classes. However the maximum percentage of dealers lies in between 20-30 activations in
a month. On calculating the arithmetic mean the average number of activations by a
dealer comes out to be 26.
11. Time within which dealers inform the franchisees about the receipt of activation
forms.
Table – 12
graph 12
0%
Less than 1
0% hour
1-2 hours
Greater than 2
100% hours
of the activation forms and it all depends on how those forms are passed on to the
franchisees for timely activation.
12. Passing of activation forms (C.A.F.) to the Franchisees for activation.
Table – 13 (a)
25
20
15 No. of dealers
10 Percentage
5
0
%
0%
0%
0%
%
20
00
-4
-6
-8
0-
-1
20
40
60
80
(b) Percentage time’s dealers send the C.A.F. to the franchisees.
Table – 13 (b)
25
20
15 No. of dealers
10 percentage
5
0
%
0%
0%
0%
%
00
20
-4
-6
-8
-1
0-
20
40
60
80
(c) Dealers intimate on phone to the franchisee and activations are made (C.A.F. is sent
later on)
Table – 13 (c)
30
25
No. of dealers
20
15
Percentage of
10
dealers
5
0
0% 0-5% 20- > 75%
75%
14) Time within which a customer is activated by the franchisee after the receipt of
C.A.F.
Table – 14
12
10
8 No. of dealers
6
4 Percentage (%)
2
0
rs
rs
.
.
..
..
a
2
th
h
h
in
re
-4
-6
it h
o
2
4
W
activation. From the chart it is clear that fifty-seven percent responses come under the less than 4
hours class (combination of first two classes) which is the prescribed time by the company. Forty-
three percent fall outside that class and thus it is an important problem area which should be
properly analyzed.
15) Dealer’s satisfaction for the time taken by the franchisees.
TABLE – 15
25
20
15 Yes
10 No
0
No. of Dealers Percentage
The chart shows that one-third dealers are not satisfied with the time taken for activation.
May times the system remains down or the workload at franchisees is high and as a result
their activation is not made on time this has a profound impact on their business.
16) Possible reasons for the delay in activation by the franchisees.
(Multiple response given)
TABLE – 16
Graph-16
45%
System Down
75% High work load
From the chart it is clear that almost seventy-five percent dealers complaint about system
down as the possible reason for the delay of activation. The other reason is high workload
at the franchisees as they have their own customers coming directly to them.
17) Dealer’s overall level of satisfaction with the company’s services.
Table – 17
..
..
Ve
..
S.
..
D.
E.
S.
Strongly dissatisfied
The above hart shows that almost half of the dealers (50%) have high level of satisfaction
and they should be moved to the highest class. Thirty percent are on the average side this
clearly points out the deficiencies in the company’s policies and attitude towards the
dealers. Being the most important part of the channel network but that too not under the
company’s direct control should be properly considered and policies should be revised.
18) Is it feasible that activations are made directly from the dealer’s office instead of
franchisees by setting the required computer network?
Table – 18
Graph-18
45% Yes
55% No
From the chart it is clear that there is not much difference in the opinion of dealers. Fifty-
five percent are agreed to setup the required network while forty-five percent are not. It’s
a mixed a bag situation and company has to decide accordingly.
19) In case of cheque payment do dealers wait for the clearance of cheque before passing
on the activation form to the franchisee?
(Customer is not known)
TABLE – 19
Graph-20
9%
Always
30% Generally
61% Never
Thirty percent depend on their appraisal of the customer and then decide
accordingly. Only ten-percent takes risk pass on the activation, as they don’t want
to loose their customer.
20) Best/Distinctive features of the company.
(Multiple responses were given)
Table-20
Brand Image
67%
91%
Promotional
Strategy
Excellent
Service
52% Strong
45% Network
their responses that Airtel’s Brand Image is best of the lot, the other features are also
important but the brand image is most compelling one for them.
21) Problems faced by the dealers.(Multiple responses were given)
Table – 21
Graph-21 No dealer
recognition
24%
Promotional
15%
75% strategy
Service
48%
Fluctuating
Margins
55%
No response
This chart shows that seventy-five percent dealers are not satisfied with the company’s attitude
towards the dealers. Nearly fifty percent are not satisfied with the promotional strategy and
Services offered by the company for them. Some of them have given no responses as they
consider them a part of every business.
ANALYSIS OF DEALER SURVEY
By looking at the charts and tables, one can have easy understanding of the various
parameters. Besides that, there are some other findings as well which are basically, the
problems faced by the dealers. There are mentioned as follows –
1. Most of the dealers surveyed have the problem that the company does not give tem
any recognition.
2. Some have problems with the company’s promotional strategy.
3. Few are dissatisfied, as they are not provided the promotional materials like banners,
pop’s, boards, etc.
4. Nearly 30.3% of dealers have very low overall level of satisfaction with the company
(table-3).
5. Though majority of dealers has very well overall satisfaction with the customer care
department but they are highly dissatisfied with the time taken to connect to the
customer care.
6. 33.3% of total dealers surveyed are dissatisfied because of the time taken by the
franchisees in activating the customer’s account.
7. Regarding the above mentioned point the most common problem found is system
down.
8. The cut-off provided by the company is not attractive.
9. Sales representative or area manager’s visit is not up to the mark.
10. Difficulty in getting the preferred numbers.
Though Air Tel as very broad network coverage but at some places signals are not
proper.
company uses high-end routers from Cisco, and is in the process of implementing a
disaster recovery (DR) set-up. As far as software is concerned, some of the applications
that are running on its network are
billing
fraud management
They also have some internal-facing applications like Oracle Financial and Oracle
HRMS.
TOOLS
Airtel has been one of the earliest adopters of software to control churn in the Indian
market. The company implemented SAS Institute’s customer retention solution.
Business Intelligence (BI) is an umbrella term for a set of tools and applications that
allow corporate decision-makers to gather, organize, distribute and act on critical
business information. BI applications include the activities of online analytical processing
(OLAP), report generation, decision support systems (DSS), query and reporting (Q&R),
statistical analysis, forecasting, data warehousing and data mining. Some of the popular
BI tools are:
Data Mining Tools - The software automatically searches for significant patterns or
correlation in the data
Query Tools - They allow the user to ask questions about patterns or details in the
data.
For Airtel, Business intelligence is the process of getting enough of the appropriate
information in a timely manner and usable form, and analyzing it so that it can have a
positive impact on business strategy, tactics and operations. BI applications allow users to
quickly and easily view data on essential metrics such as sales, inventory and customer
activities. This information can be dispersed through a dynamic interface, preferably one
that is web-enabled. If a dynamic interface is implemented, users can explore the data
from different perspectives or levels of detail.
People
Technology
Process.
People - The human element is probably the most important component in a call
center.
Technology - Call centers use network services to connect customers with the call
center, telecommunications systems including Automatic Call Distributors (ACDs)
and Interactive Voice Response (IVR) systems; and IT products such as workstations,
computing platforms, Local Area Networks (LANs) and Computer Telephony
Integration (CTI).
How to acquire, strengthen, and retain strong customer relationships in the era
Principle 1: By knowing more about the customer value and anticipating relationship
needs better than when the customer was involved in a high-touch relationship.
Principle 2: Consolidate and make available all customer interaction information from all
channels/touchpoints
Principle 3: Develop a customer centric infrastructure that can consistently support the
customized treatment of each customer.
Principle 4: Assign dedicated people, process and technology resources to achieve
profitable results
to
Data Mining
Statistics
Query & Reporting
Warehouse Management
SOLVING
Metadata Management
High-End Servers
IT Infrastructure
poor performance,
CHURN MANAGEMENT
Web Warehouse
CUSTOMER
Application
Security Specific Data Model
External Integration Technologies
Data Providers
Operational
Data HygieneData Stores
/ Enrichment
Call Center & Messaging
Middleware
Cleansing & Conditioning
House holding
Customer Profile
Content
Business Management
Strategy
Catalogue Management
Business Process Reengineering
Change Management
MANAGEMENT
Project Management
- Application Implementation
- Data Warehouse/ Data Modeling
Warehouse Architecture
Logical, Physical Design
Channel Integration
another?
INVOLVES
What are the commonest reasons for customers to switch from one service provider
DB Implementation
- IT Infrastructure
IT Architecture
Network Design, Planning & Implementation
Network & System Management
-On-going Customer Support
Regarding churn, something interesting that’s been noticed is that it’s much higher in the
case of pre-paid services, with a churn rate of 8:1, than in post-paid service where the rate
is 3:1.
The idea of pre-paid cards is that the customer will mature to become a post-paid one and
so it pays to retain him too. After all, it’s five times more expensive to acquire a new
customer than to retain an existing one.
WHY IT HAPPENS
Usually, such a high churn rate is witnessed in more mature markets where operators try
to attract customers from competitors since market growth is saturated. But with one of
the lowest telecom penetrations, the Indian market is anything but mature. Then what are
the reasons for this trend?
Many subscribers shift to another vendor due to brand image. Beyond the brand image,
higher churn is generally attributed to the numerous tariff options available to customers.
A customer may also churn due to billing disputes with a particular vendor—billing fraud
also comes into play. More than tariff plans it is the quality of customer service that
prompts a customer to churn or remain loyal. In the current market scenario there is
hardly any difference in offerings, prices and quality of service offered by different
operators. Cut-throat competition has ensured that there is not much difference between
the tariff plans offered by different vendors. This is where customer service and value-
added services come into play. If an operator doesn’t anticipate market needs or does not
provide value-added services offered by the competitor, then the customer is likely to
churn.
Other than this, some of the key factors that encourage churn are inadequate network
coverage, which includes dropped calls that occur in places where network coverage is
thin and blocked calls that occur when the demand for network services exceeds capacity.
The churn problem is more prevalent in the prepaid segment, which today accounts for
the vast majority of Indian cellular users. The prepaid customer is more price-sensitive
than the post-paid one. With rentals as low as Rs 300, customers with low usage prefer
prepaid cards. Also, students and those who like to experiment with different networks
prefer the prepaid offering.
Bharti Cellular reduced its churn from 3 percent to 2 percent with immense positive
impact on its bottom line after deploying the churn management solution SAS. Today,
they can predict with 80 percent confidence, which customer will churn. Internationally
they have reached accuracy levels of 90-95 percent. But customer variables keep
changing. Hence the solution has to be continuously fine-tuned to improve accuracy. SAS
offers a total end-to-end customer retention solution, which supports the whole process of
managing churn—right from gathering and warehousing data to predictive churn
modeling to reporting and distributing actionable results to decision makers.
The solution enables an operator to gain a better understanding of the variables that
influence customer churn. The solution predicts a customer’s likelihood of cancellation or
switchover by scoring them on a scale of 0 to 1. If a customer scores 0.73 it means there’s
a 73 percent chance of his churning. The lower the score, the more content the customer.
Once the scores are known, it is easy to figure out which customers are likely to switch.
The solution provides the telecom company with a sliced and diced view of the customer
base, thereby empowering it to treat each customer differently as per needs. The customer
attributes typically considered in a churn analysis can be broadly categorised into
customer demographics, contractual data, technical quality data, billing and usage data
and events-type data. But the most commonly used historic variables include the time a
customer spends on air, the number of calls he makes and the revenue generated from
that customer.
The predictive information becomes crucial as it gives the service provider a window to
proactively fix the glitches in service and contain churn, thereby improving bottom lines.
The solution also helps identify cross-sell and up-sell opportunities, which can have a
further positive impact on the operator’s bottom line. Once they have identified the
customers who are likely to churn they can take immediate measures to retain at least 85
percent of them.
Matching the right customer profile with the right marketing bundle creatively
Methodology
Results
Matching the right customer profile with the right marketing bundle creatively
Customer retention
Revenue stimulation
All these enhancements successfully changed the customer retention paradigm from a
reactive to a proactive one resulting in a continuous decline in postpaid churn over last
year leading to an all time low churn.
Branding and service differentiators also help in taking customers away from
competitors.
Proper operational and analytical CRM tools in place that would help segment and
analyze customer behaviors and predict their propensity to churn.
STEPS
Customer acquisition
STRATEGIES
Introduction of a new tariff plan with different slots like leisure lifestyle, executive and
premium for postpaid customers. Airtel also offers different tariff plans to different
segments like students, professionals, etc.
Airtel has also implemented an e-CRM platform to create a central database of customer
information, to enable pan-India access and service delivery.
OTHER MEANS
Airtel has introduced a plethora of value-added services to increase customer ‘stickiness’.
The common services offered by the operator include SMS, group messaging, voice mail,
caller line identification, Hello tunes, GPRS and even multimedia messaging. Other than
this, different service providers have introduced unique services for certain segments of
customers, depending on their usage patterns.
Operators have also introduced closed user group (CUG) services for corporates that
want to provide employees with cell phones but also want to restrict their usage.
Operators even offer special pricing for calls made within a limited group.
Though m-commerce hasn’t taken off as expected, certain banks offer mobile banking
services like balance enquiry, cheque book requisition, bank statements, etc, free of cost.
CUSTOMER DEFECTION
Customer-focused marketing technology is developing rapidly: The term “customer
database” is outdated. It has been found that companies, which reduced customer
defections by 5 per cent, could boost profits from 25 per cent to 85 per cent.
Today, the consumers are smarter and they expect more. As the general population
becomes better educated, consumers approach purchase decisions with greater scrutiny,
and they have access to more data for comparison purchasing.
The Internet has led to disloyalty: The Internet as a distribution channel for product
sales and information has caused many consumers to change buying habits and methods.
Researchers report record-low consumer loyalty in the Internet environment.
Price-based switching: the customers prefer those services or products which are offered
to them at much competitive prices. Hence it has become very essential for the
companies to stop the consumers from switching.
The global market introduces new competitors: As the global economy opens, our
companies are seeing increased competition, and many sectors are facing foreign
competition for the first time.
6 TYPES OF DEFECTORS
Market defectors, who are lost but not to any other business - they may go out of
business or to another market
Assessing proven methods to apply customer lifetime value to define customer CRC
CUSTOMER COMPLAINTS
When the customer pays for a product or service, it is assumed that the product will work
correctly or that the service received is as promised. Ideally, the customer will be
satisfied, and there will be no complaints. But at times, the customer is not satisfied with
the services since the expectations do not meet with the results, this causes customer
complaints.
Airtel has toll free numbers for handling customer complaints. A separate division is
meant for customer care, where, the customer care executives are present to handle any
type of customer complaint. These customer care executives are specially trained for the
same purpose.
Letters
Phone Calls
Development
Loyalty
Lost Customers
Employees
Listen
Open Details
Friendly Staff
Comment Slips
DO NOT FORGET
No matter how bad a problem is, no employee should be subjected to any personal insults
or threats from a complaining customer.
Encourage complaints rather than silence, but customers must not be allowed to threaten
your employees in any way.
INDICES
The ultimate indication of success of a CRM initiative is the change in attitude and
behavior that an organization exhibits toward its customers. To determine if the initiative
is successful is to independently develop an index and monitor the progress. A Customer
Loyalty and Velocity Index (Customer Love) has been done. The index's intention is to
determine if the CRM initiative is successful from a quantitative view. Components of
the index are:
MARKETING
Market share
Product positioning
SALES
Customer turnover (rate of new customers to departing customers and the active
customer base size)
Win rate
CUSTOMER SERVICE
Books:
1. CRM Automation by Barton. J. Goldenberg
2. CRM Handbook: A Business Guide to Customer Relationship Management by Jill
Dyche
3. Essential Guide to Knowledge Management, the e-Business and CRM Application by
Amrit Tiwana
4. Accelerating Customer Relationships: Using CRM and Relationship Techniques by
Ronald S. Swift
5. Essentials of CRM by Bryan Bergeron
6. Customer Relationship Management Technology by Dr. Jon Anton
7. A practical guide to CRM Building More Profitable Customer Relationships, by Janice
Reynolds
Magazines:
1. Destination CRM
2. Customer Contact World Magazine
3. Customer Interface
4. Customer Inter@ction Solutions Magazine
Journals:
1. Interactive Marketing Journal
2. Ivy Business Journal November/December 2002
Websites:
1. www.crmdaily.com
2. www.realmarket.com
3. www.crm2day.com
APPENDICES
Questionnaire
Name____________________________________________
Age______________________________________________
Occupation______________________________________
2).How would you rate Air Tel’s network in your area? - Rating
Excellent…. Good….Needs improvement….
4).When phoning at the customer care department how quickly is the call transferred to
the customer care executives?
Immediately….Within few minutes (2-3min)…. Takes Time….
5).How responsive are the customer care executives in returning the phone calls.
Excellent….VeryGood….So-So….Dis-satisfied…Strongly Dissatisfied….
2
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11).Time within which dealers inform the franchisees about the receipt of activation
forms.
Less than 1 hour… 1-2 hrs…. greater than 2 hrs….
(c) Dealers intimate on phone to the franchisee and activations are made (C.A.F. is sent
later on)
Percentage times during a
month
0%
0-5%
20-75%
> 75%
13) Time within which a customer is activated by the franchisee after the receipt of
C.A.F.
Time
Within 2 hours
2-4 hours
4-6 hours
More than 6 hours
17)Is it feasible that activations are made directly from the dealer’s office instead of
franchisees by setting the required computer network?
yes No
18).In case of cheque payment do dealers wait for the clearance of cheque before passing
on the activation form to the franchise?
AlwaysGenerallyNeve
r