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3 Industry survey.

Article Excerpt
3.1 Overview of survey--aims and methodology

Between December 2003 and February 2004, Chorleywood carried out a survey to determine the industry's perception about churn, customer retention and CRM. We wanted to discover, among other things, whether it was felt that churn levels had improved in recent years, what industry experts thought were the key reasons for churn and why they thought it was important to keep churn levels to a minimum. We were particularly keen to gain an idea of what operators were doing to tackle churn in their own organisations.

The survey was presented to respondents in the form of a questionnaire, which considered 14 basic questions. It was mailed electronically to a targeted group of individuals from Chorleywood and Informa Telecoms' databases. Some attendees at the 3GSM event in Cannes in February 2004 also completed the survey. Respondents were given the option to remain anonymous. While this does not impact the responses provided, for geographical and sectoral breakdown (see Section 3.2) it should be noted that 13% of the total respondents chose to remain anonymous.

The questionnaire was split into two sections. The first section was common to all respondents. However an additional section was filled out only by operators and contained specific questions concerning churn reduction/CRM strategy within their organisation.

It should be noted that responses may or may not be reflective of the views of the companies to which the individual respondents are affiliated. Care is required when interpreting these results as the survey is only indicative of the views of a snapshot of the industry.

3.2 Company analysis and geographical breakdown of respondents

3.2.1 Company characteristics

The survey attracted a mixture of respondents, as shown in Figure 3.1. The largest set of responses was from the mobile operator community, which represented some 60% of total respondents. However, we also received responses from broadband service providers, ISPs, fixed-line operators, regulators, vendors and consultants.

3.2.2 Geographical characteristics

Chorleywood received a varied geographical spread of replies from the industry (see Figure 3.2). By far the largest number of responses came from Western Europe (42%). Taken together with Eastern Europe, the European region as a whole accounts for 65% of the total respondents. However, the so-called developing markets are represented well in the survey--Asia-Pacific, the Middle East and much of Eastern Europe.

The interest in churn and customer retention from the developing markets, with particular reference here to the mobile sector, is most likely reflective of the fact that in those markets, churn is being prioritised more and more as customer acquisition slows. Developing markets are, by their very nature, playing catch-up and are following the trends displayed by other more mature markets in their need to address churn. If anything, and because they have learnt from the developed markets, these developing markets appear to be responding a lot quicker to the pressures of churn. The tools to combat churn are already out there and have been tried and tested (see Chapter 6).

3.3 Answers to survey questions--all participants

3.3.1 Respondents' view on churn as a growing problem

The survey participants were asked if they thought churn was a growing problem for mobile operators. Figure 3.3 shows that, perhaps not surprisingly, the vast majority (88%) of respondents believe that churn is a growing problem for the mobile industry. However, a more detailed examination of the data reveals that the only dissenters to this view (and it is a small number) come from the operators--all other respondents felt churn remained a growing problem for the industry.

While the result may not be surprising it sets the context for the follow-on questions asked in the survey which seek to gain an insight into industry perceptions about churn, its impacts on the business, the factors influencing it and how operators are choosing to tackle the problem.

3.3.2 What is an acceptable level of churn?

Respondents were...

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