Avoid Data Becoming a Commodity: 5 Ways to Move to Value Based Offers

Apr 26, 2013

Rather than go down the route of commoditizing data, many operators are developing value based products and services that are supported with value based pricing. Providing value based services enables operators to price based on the value delivered — which is often described as the optimum pricing strategy as it enables much more flexible pricing that suits both customers and operators alike.

In order to help move to value based services, operators can look to the concept of Dynamic Services. This is a concept built upon real-time understanding of customer behavior and developing offers and services that can be sold as add-ons and value added services to augment a basic data centric offer. At a high level the five solutions presented below can be used to deliver Dynamic Services to consumers.

1. Start with Simple Pricing for Basic Bundles –this encourages data adoption and usage. As more operators turn all you can eat packages on their heads by offering unlimited voice and messaging, and having data as the differentiator and main deliverer of value, it’s important that as many customers as possible use data. Operators are trying innovative ways to encourage data adoption – ranging from app specific services passes (e.g. facebook, twitter passes) for low monthly costs, and removing the uncertainty of high data costs by real-time communication on data usage and costs.

2. Provide Dynamic Offers Direct to the Device – these provide the foundation for value based pricing. They are real-time, personalized offers delivered direct to the customer’s device which provide an effective method to upsell relevant offers. As simple example is upselling a 1GB data block when a customer is approaching their monthly data limit.

Real-time usage information, delivered direct to the device, and the ability to buy, provision and use services in real-time is the basis for providing dynamic offers.This ability to offer a wide range of add-on services, market and sell them in real-time direct to a customer and deliver in real-time opens up opportunities for context sensitive sales and marketing.

3. Use Policy Controls to Manage Product Features – this is used to provide the ability to control product features. Adding rules and controls into access, speed and usage enable marketers to control offers, which in turn can support product development, upsell and marketing opportunities. An example of a dynamic service enabled by policy control is upselling additional speed— e.g. upselling data block at high speed, when a customer has reached their limit and speed is throttled, and / or selling speed boosts for specific services (e.g. hi def video).

4. Offer OTT and Value Added Services Bundles - By selling OTT and VAS offers to customers, operators can help differentiate their services as well as open up new revenue streams by offering a wider range of services. Selling OTT and value added services helps the operator to add value based elements into their offers, delivers a better offer to the customer, (e.g. buy content without using data allocation) and also the content provider gets a partnership that can market the content offers direct to their customer base.

5. Take the Uncertainty out of Data Roaming - Recently, data roaming was a major problem—a high percentage of customers weren’t using it. Now some operators are starting to overcome this problem by offering data roaming service passes. These passes enable a customer to buy a volume of roaming data for use over a pre-defined time (e.g. 1 day, 1 week). They use it, and when the allocation is used up, they can buy another pass. These roaming service passes can be sold and provisioned direct on the device making it as easy as possible for customers to use data while roaming.

Offering Dynamic Services to consumers can help operators differentiate data by enabling value based services. Starting from simple base plans, operators can use real-time business intelligence to build on these to create and provide personalized, flexible value based offers, which contain a range of add-ons and value added services.

Operators need to have the ability to create new offers quickly, and provide personalized context sensitive marketing delivered direct to the device to sell these services. They also need to offer controls to define offers and flexible rules to enhance and develop new real-time monetization models. This is a major advance from traditional voice centric mobile communications, but one that several leading operators are adopting in the strategy to grow revenues by delivering increased customer value.

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