How 100,000 pre-paid users moved to post-paid plans in one go.
In 2019, one of Brazil’s major mobile operators joined forces with Upstream to drive digital post-paid sales and capitalize on the surging consumer shift to online. This without forbidding CAPEX or OPEX investments or lengthy roll-out periods. Even when the COVID-19 crisis hit, the MNO had already adopted the online user experiences while thriving in new digital reality.
The result? More than 100,000 pre-paid customers were moved up the value chain – That’s a 20% increase.
Upstream smashed the target by 360% while knocking down migration costs by 40%.
BACKGROUND
With more than 200 million subscribers, Brazil is Latin America’s biggest telco market. But it is volatile with churn-prone pre-paid subscriptions dominating. That’s why every Brazilian mobile network operator (MNO) is trying to boost its post-paid penetration.
Market trends favour this strategy. Post-paid subscribers grew from 24% in 2015 to 39% last year. But that still leaves room for improvement.
Pre-paid customers churn at rates from 37% to as much as 80%[1] — a status quo that forces some MNOs to replace their entire pre-paid customer base every two years.
“Churn is so high in pre-paid that a typical MNO needs to replace its entire pre-paid customer base every two years.”
The incentives are obvious: higher and more stable ARPU, lower churn, higher loyalty. That’s why moving pre-paid customers up the value chain is a strategic enabler for mobile operators. It can add up to 50% more fixed income to an MNO’s bottom line.
“More revenue, more predictably.”
But what is the best channel for pushing pre-paid subscribers up the migration path? Consumer research shows a surging preference for online.
60% of mobile users opt for the web when they want to buy telco products and services. COVID-19 is only fuelling the shift to online-first.
Most MNOs were caught out by the pandemic-driven closure of storefronts and call centres, leaving email and web as their only means of sustaining customer contact.
The vast majority[2] now expect to see more sales and support queries happen online. More than half are planning to close their underperforming physical stores and even reduce call centre capacity.
In order to seize the digital sales opportunity, Upstream is your digital sales partner to help you unlock digital’s full monetization potential by speeding-up customer activations and making it easier to up-sell and cross-sell across your customer base. Upstream has been working with operators in developing economies for 15 years. We have created end-to-end solutions that allow these MNOs to migrate to digital sales in weeks. See below our recent success story with one major mobile operator in Brazil.
THE CHALLENGE
A major Brazilian MNO wanted to upsell a target group of higher-value pre-paid customers.
The objective was to deliver those conversions and reduce upgrade costs by 20% — without call centres or in-store promotions.
The operator had already engaged e-dealers and was making inroads but needed to boost efforts with a new approach.
In the past, adding digital sales capability in a telco environment would have required significant CAPEX, OPEX, and a lengthy implementation period.
Upstream’s complimentary solution worked with the MNO’s billing and CRM systems to unlock new digital channels quickly – and without upfront investment.
UPSTREAM’S SOLUTION
Upstream used a multichannel strategy to engage customers through a range of traditional and non-traditional channels, and digital channels. One of these new channels was Upstream’s own proprietary data rewards platform. We targeted customers who visited the zero-rated content portal via engaging video and display ads to drive clicks and conversions.
The multichannel mix was continually optimized to keep conversions going.
Hundreds of A/B tests were conducted to make the purchase journey friction-free. Data inputs were simplified, and copywriting was optimised. Upstream measured how customers behaved and used the data to create a more seamless buying experience.
“Optimising the design of online forms can minimise cart abandonment and maximise conversion – sometimes dramatically.”
Elements like flow steps, layouts, creative, copy and landing pages were continually re-mixed to deliver the combinations that performed best.
The design and placement of input forms are hugely important. When customers are on an upgrade path the right form can speed up transactions, reduce cart abandonment, and maximise sales – sometimes dramatically.
For example, Upstream identified a stage in the purchase journey where dropouts happened frequently. Adding a confirmation screen at a crucial point gave customers the reassurance they were looking for. It improved conversions by 44%.
Upstream also used advanced re-targeting to catch subscribers that had fallen out of the funnel. Results were analysed to find the channels and messages most likely to win back wobbling buyers.
And customer acquisition didn’t stop at sign-up. Strategic, post-sale actions were taken to promote engagement and improve retention. Email marketing campaigns informed customers about the features of their purchased plans. Payment notifications were also created to prompt new subscribers ahead of their due dates.
THE RESULTS
Upstream beat the mobile operator’s target by more than 360 percent – within three months of go-live.
“We’ve moved more than 100,000 pre-paid users to higher value post-paid plans.”
Upstream’s approach has already driven 63PB (Petabytes) in new data purchases. Our services are responsible for 25% of the operator’s plan upgrade business, which has grown by 20%.
Crucially, by avoiding in-store promotions and call centres we slashed the cost of migrating pre-paid customers up the value chain by more than 40%. More importantly, the implementation of digital sales along with Upstream prior to the COVID outbreak gave a significant competitive advantage to the MNO and guaranteed the continuity of sales during the pandemic.
Our dedicated team was laser-focused on achieving the MNO’s objectives, bringing creative, strategic, and technical expertise acquired over hundreds of engagements to deliver the most effective campaigns.
“For Upstream, hitting client targets is vital.”
Our business model is pegged to driving sales, with no upfront CAPEX or OPEX.
We only succeed when our MNO clients do.
Mobile operators in developing markets have a right-now opportunity to move millions of customers from pre- to post-paid plans. But they need to reduce their reliance on analogue channels first.
In a post-COVID, online-first world, marshalling sales efforts around digital channels is the only route to success.
