Communications industry trends report 2022: Digital transformation is key to success
Today, customers have more choices and louder voices when it comes to communication service providers. They increasingly view communications service providers as commodities, and the industry is learning that they need to step up to attract and retain customers.
This is according to the latest communications industry report from Salesforce. To help providers understand how customer expectations have evolved and what's required to succeed amidst the changing industry landscape, Salesforce surveyed 500 industry leaders and 6,000 customers for its 2022 Trends in the Communications Industry Report.
2022 Trends in the Communications Industry Report by Salesforce reveals that quality of customer experience and value is key factors for customer retention.
Here are the key takeaways from the report:
- The vast majority of customers are willing to look elsewhere for communications services - We are in a trusted experience-led economy where 88% of customers say the experience a company provides is as important as its products or services. Roughly three quarters of the customers surveyed in the report said they would be at least somewhat likely to get wireless (78%) and cable (76%) services from non-traditional providers like Google. By 2023, less than half of U.S. households are expected to have traditional cable services. Of the customers surveyed who had "cut the cord," 33% percent stated they did so in favor of streaming services like Netflix, Hulu, and Amazon, and 20% reported they have switched to wireless-only connectivity, including 5G home internet, straight from their cellular devices.
- Customers want optimized online channels and enhanced in-person experiences - Over half of respondents (51%) prefer to do business online, with 64% reporting they used their provider's website over the last month. However, 40% of customers also visited the store over the same time period, and 35% prefer to do business online and in stores.
- Customers want great service at every touchpoint - The vast majority (90%) of communications service leaders agree or strongly agree their company makes it easy to communicate internally to resolve customer cases faster. But these efforts are not making a strong enough impact on overall customer satisfaction. Almost 40% of customers are unsatisfied with their current providers. Further, 50% percent of wireless customers and 47% of cable customers believe they get the best service when they threaten to switch to a different provider. Communication service providers must realize that the marriage experience has to be better than the courtship experience.
- A company's values matter to customers - Communications industry leaders surveyed in the report ranked carbon accounting (79%), closing the digital divide (84%), social responsibility (80%), and supporting underrepresented minorities (79%) as extremely or very important.
- New technologies lead to new opportunities - The faster connectivity, more reliable service, and entertainment opportunities that can come with 5G technology should be a huge selling point with customers. In fact, when presented with a list of benefits that accompany 5G technology, more than two thirds (67%) of respondents said they would pay more for it.
- The future is online and digital transformation is the key to success - More than half of customers (51%) surveyed prefer to conduct business "only or mostly online." Meeting these needs and expectations requires that providers invest in powerful and intuitive tools (like customer portals) that enable seamless, friction-free transactions.
- The industry has to evolve with the times - Communications service providers need to change public perception from an industry on the verge of commoditization to one that is steadfastly customer-centric. Offering enhanced, engaging, and personalized experiences will ensure that providers stay competitive in this ever-evolving industry.
Build trust and reduce customer churn by focusing on the customer experience
With more choices, the incumbent communications service providers are no longer the default. As alternatives emerge, people are ready and willing to explore choices beyond their traditional providers.
Seventy-eight percent of wireless customers and 76% of cable customers said they are at least somewhat likely to switch to a tech provider. What's more, a growing number of cable customers are cutting the cord altogether, opting to rely on streaming entertainment services (33%) and wireless internet access (20%). In a world where the vast majority of customers (80%) will abandon a retailer after just three negative experiences, providers don't have much room for error. When asked about what might make them consider switching internet service providers, respondents cite price and speed at the top.
Customers are willing to change communication providers for these reasons
According to the report, both online and in-store experiences leave much to be desired. Over half of respondents (51%) prefer to do business online; in fact, 64% reported using their provider's website over the last month. However, that doesn't paint the whole picture. Forty percent of customers also visited the store over the same time period, and 35% say they prefer to do business online and in stores. This means that the optimization of physical experiences cannot be ignored.
Customers want to feel like they matter throughout the customer lifecycle. Fifty percent of wireless customers and 47% of cable customers believe they get the best service when they threaten to switch to a different provider.
Ways in which cable carriers can improve customer satisfaction
Communication providers are investing in network modernization
As more of our personal and professional lives move online, it's imperative that providers meet business and consumer needs for greater bandwidth with faster throughput, lower latency, and improved reliability. This means investments in 5G and fiber connectivity. Customers will pay more for 5G. Communications service providers have had a difficult time communicating the value of 5G and as a result, many customers are still unsure as to the opportunities it provides. Salesforce research found only 44% of respondents were "very familiar" or "extremely familiar" with 5G technology. However, 67% of respondents said they would be willing to pay more for 5G. In addition, research indicates that 5G infrastructure will open B2B opportunities inside and outside of the industry by enticing partnerships and bundling opportunities across multiple industries.
Communication service providers can use 5G to expand partnership ecosystems
Digital transformation unlocks efficiency and customer satisfaction
While 90% of employees agree or strongly agree their company makes it easy to communicate internally to resolve customer cases faster, this is not having a strong enough impact on overall customer satisfaction. Only 62% of customers feel satisfied with their current providers. Digital transformation and streamlining operations are key steps to meeting these expectations and providing personalization at scale.
Digital transformation doesn't just benefit the customer, 91% of provider employees said reimagining operations would reduce bottlenecks and redundant processes, while also helping their companies save money. Today, B2B respondents are dissatisfied with the totality of online experiences offered by providers. B2B users report experiencing frustration when trying to manage accounts online (39%), make large purchases (36%), and request changes in service (36%). B2B users also reported frustration when using assisted digital services (31%) and self-service (34%) tools. Also concerning is that only half (53%) of procurement employees said they felt comfortable managing their enterprise accounts online without sales agent assistance.
The Trends in Communications Industry Reports concludes by noting that providers can avoid commoditization, providers must differentiate themselves and become genuine solutions providers. And many are already taking action. But more work is needed - consumers continue to believe the industry lags when it comes to customer service, digital capabilities, and consumer-provider relationships. In a digital-first and hyper connected economy, communications providers must deliver personalized value at the speed of need. The expectations are changing and growing more so the opportunity to innovate and deliver meaningful experiences is the only way to earn the future business of the ever more demanding consumer.