Melon Mobile disrupts with AI. Who’s next?

Those with their MVNO ear to the ground, will have seen that one of South Africa’s newest MVNOs, Melon Mobile, has partnered with AI data specialists, SourseAI. Under the terms of the deal, Melon will use SourseAI’s AI tools to develop personalised customer experiences and make customer acquisition journeys more efficient.

I met the Melon team at MVNO Nation last year, and I’ve watched its growth with interest. They make no bones about their disruptive strategy so the announcement to work with Sourse didn’t come as a big surprise; it matches up to everything I’d expect an innovative brand like Melon to be doing.

The telecoms industry is awash with brands saying the customer is front and centre, waxing lyrical about personalised offers, tailored service, and digital experiences. But these guys really are putting their money where their mouth is, and clearly on a mission to work with like-minded innovators.

Sourse pursues the vision that AI can be set to work on common telco business challenges, such as how to optimise marketing spend and improve acquisition efficiency, find the optimum prospects for cross selling and the perfect time to pitch offers, and spot customers with a high propensity to churn much earlier in the lifecycle.

It delivers incredible value very quickly, which is why it’s a shrewd move by Melon. It can use the insight to drive value, but most importantly improve the customer experience knowing there’s a greater probability the strategy will work.

Melon isn’t alone though. More and more MVNOs are taking this route to differentiate. It’s a trend I have seen at MVNO conferences around the world. There’s a real appreciation for the technology, and how it can put clear water between the competition. What’s more, being more agile than MNOs (as MVNOs inherently are) they can steal a march quickly with startling results.

It’s a significant change from a few years back, when MVNOs focused on discounted pricing and driving acquisition, with little or no thought to how they would manage the churn that such as strategy invariably drives.

That strategy is now being left for dust by the digital innovators, who view it as a way to bring significant competitive advantage. In the past, MVNOs wouldn’t have had the available budget to invest in large teams and data crunching technology. But the combination of cloud, SaaS and rapid innovation in AI has changed that. It’s now an investment that’s affordable and will deliver a quick and very efficient ROI.

In fact, when compared to MNO counterparts with legacy platforms, there’s even more reason to adopt AI. MVNOs can take advantage of their ‘digital native’ platforms to swoop in and compete. Scale isn’t a barrier. Instead, within weeks they can use unbiased data insights derived through AI models to develop and introduce customer initiatives across their digital channels. No matter if it’s to reduce churn or move the dial on CLV and the cost to acquire, AI gives them a new advantage.

Over the next few years, I anticipate we will see more and more MVNOs driving competitive advantage through partner relationships like that of SourseAI and Melon. There are so many markets where this can be applied. From those where new licenses are being issued, to those where there is consolidation, I am certain AI will feature more.

Personally, I’m really looking forward to hearing how this relationship performs, but most of all I’m excited to see how two start-ups shake up the industry and become a model for other markets.

James Gray

About James Gray

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.