How bundling third-party OTT services reduced churn and reversed subscriber decline for European mobile operator
When merchants and OTT providers partner to provide streaming services through bundles, rewards and incentives, success is measured in customer numbers. But the criteria for success differs. Merchants expect incremental growth in customer numbers for each offer that goes out. A network operator may have a different measurement – retention. Put another way, the merchant is looking to add new customers at a faster rate than usual; the operator is looking to slow down churn away from its network, and to boost the value of its existing base.
To illustrate this, consider the example of one mobile operator in Southern Europe. Focused on reversing the trend of a declining mobile subscriber base in a highly competitive market, it needed to innovate its customer offers and incentives. Simply bundling more of its own services had not arrested a slow but steady decline in subscribers. The innovation was to turn to bundling third-party services – especially popular streaming music and movie services – with their own mobile and broadband subscriptions.
The third-party offer was timed to land with selected customers in the year-end race to maximize both subscriber numbers and average revenue per subscriber. The operator put together a bundled offer to contract subscribers who could enjoy a free, bundled third-party streaming service by committing to a further 12 month contract. The offer hit the market at the end of 2018, and saw the mobile operators churn rate improve by 2% which, along with new subscribers attracted to the network by the offer, reversed the overall subscriber decline trend. The merchant achieved its goal of incremental growth by adding over 250,000 new customers in just one month.
Enabled through the Bango Platform, this bundling and marketing strategy produced one of the best rates of return experienced by the operator and merchant in that market.