Next-generation mobile protection helps consumers protect, manage, optimize, and enhance their mobile device, mobile data assets, and the overall mobile customer experience. In this article, Frost & Sullivan will highlight the important benefits of next-generation mobile protection for carriers, and explain how carriers can generate long-term customer loyalty, enhance productivity, and increase revenues by offering Tnext-generation mobile protection to their customer base.
Carrier Benefits of Next Generation Mobile Protection
Exhibit 1 shows the important benefits of Next-Generation Mobile Protection for carriers.
* No Trouble Found (NTF) refers to a device that has been returned for warranty replacement or service repair,
but operates properly when tested.
but operates properly when tested.
Source: Frost & Sullivan
Reduced Customer Churn, and Increased Loyalty
An average smartphone customer generates approximately $2,000 in service revenue over a 24 month period. Losing high value customers in this fiercely competitive market is simply unacceptable for a carrier. Frost & Sullivan’s analysis indicates that churn rates for customers that don’t have any mobile protection (and have had a device incident such as loss or theft, or a data-related incident) is nearly two times the churn rates for customers that have next-generation mobile protection (and have used it to file a claim, find their phone, protect their data, etc.). Thus, next-generation mobile protection has proven to be an extremely effective way to reduce churn for mobile subscribers and retain valuable customers.
Increased Revenue
Increasingly, consumers are considering integrated mobile protection services – over standalone handset insurance – as more comprehensive plans are introduced and the enhanced “value” of their investment becomes apparent. Therefore, the adoption of next generation mobile protection (i.e. mobile handset protection, mobile data protection, mobile application support, and mobile device support) provides an opportunity for carriers to price plans at a premium (when compared to standalone handset protection) and increase average revenue per user (ARPU).
Reduced Concessions and Cost of Customer Care
Smartphone users with mobile protection can quickly file a claim should they have a device incident such as loss, theft or damage, and receive a replacement device in about 24 hours. These programs allow carrier to avoid paying concessions, such as a providing a free or discounted phone, to keep a customer who doesn’t have a protection plan. Mobile protection also turns what could be a bad experience for the customer into a good experience, which generates positive consumer sentiment and goodwill toward the carrier.
Reduced NTF and Remorse Returns
A significant percentage of recently purchased smartphones that are returned to the carrier are categorized as no trouble found (NTF) or remorse returns. Frost & Sullivan research indicates that in many cases, what is perceived as a malfunction (causing the user to return a mobile device) may simply be a case of unfamiliarity with the new features and functionality of their new device. An effective mobile application and device support offering can reduce the number of customers returning mobile phones during the remorse period, maximize customers’ use of the phone and data plans, and help avoid customer frustration which can impact affinity towards the carrier.
Increased Productivity of Carrier Sales Representatives
Frost & Sullivan research indicates the adoption of comprehensive mobile protection reduces the number of customers that walk into carrier stores with support questions. It also reduces the number of customers coming in for help with device incidents (such as a device loss, theft, damage, or a malfunction). A small percentage of customers that have mobile protection may still come into carrier stores to ask for help with various issues. However, research indicates that store representatives spend less than 10 minutes per device incident to help customers with mobile protection (compared to more than 50 minutes per device incident for uninsured customers). Therefore, by reducing the number of customer walk-ins, and by reducing the time required to help walk-in customers, mobile protection allows sales representatives to focus on revenue-generating activities such as sales.
Leading Carriers Should Consider Offering Robust Mobile Protection Programs
Consumers expect ongoing support from their carrier for all of their device issues. It can be prohibitively expensive for carriers to deploy the required resources (such as a large team of technicians) to handle the gamut of smartphone-related support requests that inevitably materialize as devices become more sophisticated and interconnected. One of the ways in which carriers can support the various mobile protection requirements of their customers is by partnering with specialized providers that can integrate all of the components in a mobile protection offering into a seamless user experience. Carriers are encouraged to conduct a detailed analysis of the various mobile protection vendors in order to select the right partner for their device protection programs. Frost & Sullivan believes selecting a partner that can provide an end-to-end, integrated user experience that incorporates all components of mobile protection is a critical consideration for carriers’ to succeed in the rapidly evolving mobile communications market.
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