Monday, December 21, 2015

What if Telecom Consumers Can Not be Made "Really Happy?"

“Compared to what?” often is a reasonable principle to be kept in mind whenever we look at consumer satisfaction ratings.

Some industries, including the Internet service provider, cable TV, airline, mobile services and fixed network voice services, typically score towards the bottom of multi-industry surveys of consumer sentiment.

There are some logical potential strategy implications for service providers who want to do better.

If a whole industry tends to score poorly, then it likely does not make sense to invest “too much” to improve consumer experience, to obtain higher consumer satisfaction ratings. In fact, it might well not be possible to improve scores all that much.

Some industries--such as the airlines--simply never rank anywhere but near the bottom of satisfaction ratings, undoubtedly for structural reasons. Cable TV and telecom services likewise always are at the bottom of multi-industry satisfaction ratings.

Most people could think of plausible reasons why dissatisfaction would be high for airlines, communication services or health insurance.

Insurance claims processes are complex and arguably more frequently used than other types of insurance interactions. That means the odds something will prove irritating is higher than for some other products.

High premiums, deductibles and co-pays also provide easy sources of irritation. Constant price hikes for video subscriptions are a constant irritant. It might be harder to understand the unhappiness with Internet access services, though prices (value, compared to price) is an issue.

Airlines have very high “experience” barriers. Airline service unhappiness due to perceived low service quality has declined as providers have struggled to provide the low fares people want, and still earn a profit.

People want low fares, but the effort to do so has lead to base fares and add-on costs for baggage and so forth. The additional charges are an irritant, even when people also say--and act as though they value--they want low fares.

And even under the best of circumstances, travel delays and other irritations are a constant threat.

Granted, suppliers arguably can, and should, invest enough to gain advantage.

But it might not be wise to spend “any amount,” since the best that often can be hoped for is relatively better scores compared to key competitors, not a breakout compared to all other industries.

In other words, it is possible that--no matter how much is done--even the best providers in some industries can only advance so much.

One survey of mobile Internet access by Vasona Networks found improving satisfaction with mobile Internet access.

In the U.S. market, though, satisfaction with nearly every consumer communications or entertainment service fell in early 2015.

Customer satisfaction scores for subscription TV, Internet, mobile and fixed line telephone service, plus computer software, collectively dipped 3.4 percent to an ACSI score of 68.8 on a 0 to 100 scale, the lowest level in seven years.

Some segments fared worse than others. Customer satisfaction with subscription TV service dropped to 63, the absolute worst score among 43 industries covered by the Index.

But Internet access service, which one might think would fare better, had the same score of 63, at the bottom of the index, across industries.

ACSI says the decline results from poor customer service and higher prices. The price issue is a bit of a paradox. For the most part, ISPs have been boosting speeds, while holding prices roughly steady, while adding higher-performance tiers, sold at higher prices.

In a survey conducted by Vasona Networks, 67 percent of U.K. consumers said they expect “good mobile data performance all of the time, with no temporary hiccups or outages.”

On the other hand. those same consumers do not appear to base their buying decisions on mobile data performance. When choosing a provider, mobile data remains a low priority in the minds of consumers.

Only 23 percent of respondents say they choose a carrier based on its mobile data experience.

Also, as often is the case, the access provider gets the blame when devices or apps do not work well. Some 53 percent of responsdents blame their mobile operator if apps do not work.

Some 40 percent of U.K. respondents think switching suppliers would help, the corollary being that 60 percent believe even switching providers would not help.

Vasona's research highlighted that improving web page loading speeds is a key area which mobile operators should focus on to alleviate the biggest problem which consumers have with current networks. Some 63 percent of respondents say “web pages loading slowly or not at all” is the single most frustrating issue with mobile broadband.

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