Building a differentiated customer proposition. Top three questions to ask

To be successful in mobile, MVNOs must build differentiated propositions. Offering the same service as the MNOs at a cheaper rate doesn’t cut it. Economics dictate that MNOs can always afford to go lower than the MVNO if they are inclined to do so. And they will, I’ve witnessed it many a time.

Yet one of the biggest challenges I encounter when working with MVNO clients that want to make a splash and gain share, is their lack of appreciation for, and therefore their commitment to, the proposition. They are often blindsided by their technology investment. And, dare I say it, there’s a cohort of consultants that are just as easily side-tracked by the hype of the technology. Try to avoid them as you develop your proposition as it could inhibit your potential.

Why would I say that? I have worked on many projects where the tail wags the dog and propositions are built to fit the limitations of the technology. It rarely leads to a successful roll out. It just undermines the business case and minimises the revenue potential.

I can sympathise though. In an industry that loves its LTE, VoLTE, 5G, OSS BSS – I could go on – it is not uncommon to lose sight of the fact that the technology is just an enabler. People don’t care about the bits and bytes they simply want it to work and help them in their life or work.

That’s why we always advise MVNOs trying to unlock growth to start with the strategy and the customer proposition and use them to define what the hardware needs to deliver. There are three rules we always encourage:

Start with how you want to differentiate. Is it in service, price, or offering something unique to your customers?
Then identify who your customers are and if they truly want it. In many of our engagements we have worked with clients to segment their base and/or the market to identify groups of customers most open to their proposition.
Re-evaluate your strategy knowing more about your customers’ behaviour and if you have a match assess the hardware to deliver it.

In an ideal world you would segment customers first and then build propositions for them. The days of segmenting customers by postcode and age are long gone. No two people or families living next to one another on a street are identical. They have different demands on budget, hobbies, aspirations. These nuances all need to be understood to make a proposition fit for market.

It’s one of the reasons we built our market segmentation tool, which all our customers can licence. We have used it successfully in the UK with multiple customers and even helped a multi-play MVNO in Greece to develop its own version of it.

These MVNOs have learnt that you can’t make money without knowing your customers. And you can’t build a clear strategy either. They regularly ask:

Do I have a clear strategy that covers vision, mission, strategy and tactics?
Do I really know who my target markets are and why my brand and offer would appeal?

But they also check they haven’t strayed into old territory, away from being a marketing organisation back to a technology one. If they find they have then they reset and re-evaluate brand purpose again.

Working in this way is a step change. But it is well worth adopting the practice. It will accelerate your business and create more opportunities for success.

If you think you may be overly relying on your technology to deliver your brand then talk to us. We can help you maximise the investment you have made by developing propositions that work.

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James Gray

Managing Director at Graystone Strategy

James has over 20 years of experience working in the telecoms and retail industries. He is an expert in subscription-based business models, CRM, direct and indirect channel management and major proposition development and launches. He has held a number of Marketing Director and Consumer Director roles.