Mobile Networks' Churn Gloom

David Murphy

The Mobile Network Operators (MNOs) are trying hard, some perhaps harder than others, to build real loyalty among their customers, not only to increase ARPU (Average Revenue Per User) and customer lifetime value figures, but also to reduce churn. But a report just out suggests that there is a long way to go yet. In fact, says the report, mobile telecoms companies are losing customers twice as fast now as they were two years ago, despite the advent of 3G services and the richer customer experience that 3G can deliver.
The research was conducted by Group 1 Software, which spoke to senior marketers in the top 1,000 UK companies. It found that customer defection rates in the mobile telecoms sector stood at 33.4% in 2005, compared to 15.5% in 2003.
While other industry sectors have also seen churn rise banking has gone from below-10% in 2003 to almost 20% in 2005, mobile is still the highest churning industry sector of all those surveyed. If the MNOs were looking for a challenge  in 2006, it looks like theyve found one.

Group 1 Software