Telekom Slovenije: Data + Intuition = Success

LONDON -- TV Connect 2017 -- Speaking at the TV Connect conference yesterday, Simon Slonjsak, Telekom Slovenije's head of triple-play and pay-TV, shared his approach to new product deployment. While the product in question was smart home technology, the thought process can be applied to any new feature or service deployment.

Telekom Slovenije has an innovative history, being one of the first operators worldwide to launch an IPTV service in 2003. It is also moving quickly with its mobile network evolution, currently in advanced trials with 4.5G technology and field testing 5G.

The first consideration Slonjsak stressed was that operators should not rely only on digital channels for product launches, but also be present in physical retail environments. While it's tempting, and often cheaper, to rely on digital channels, they need to be supported by physical channels as well, otherwise the operator risks losing out on certain customers.

And even though there is a lot of price pressure on operators today, he felt that operators had room to grow their share of discretionary income. In Slovenia, for example, only 4% of the average household spend was with operators. Given the importance of broadband and mobile communications, he argued this number was low.

Slonjsak saw opportunities for operators to go into connected home services, mobile banking, utilities and other new services. But at the same time, he cautioned against trying to be all things to all people. "We have to figure out what we can do, and do well," he said.

In addition, it's important not to be drawn into technology deployment just because it becomes available. Instead, operators must look at the value to the end user. He cited the example of 5G, saying everyone was talking about it, but why should operators deploy it? Will it substantially improve the consumer experience for applications they are using today? Higher bandwidth and better connectivity are only important if there is a bottleneck today, in key applications that customers use.

Using big data is an important issue in the process of identifying new opportunities and consumer preferences. But simply having a lot of data isn't going to answer all your questions. It's important to track as much as possible, but having analytical tools is probably at least as important.

He also stressed that while data could support or challenge opinions, and force strategic discipline, it should not be seen as the answer to everything. Telekom Slovenije is investing heavily in data gathering and analysis, but Slonjsak feels the best way to use data is to validate or challenge assumptions made more instinctively. "Otherwise, you are just looking at a lot of numbers," according to him.

In his opinion, there are three important inputs into the strategy development funnel: data, market research and intuition. (Note that he draws a distinction between data gathered by tracking existing customers and market research surveys, asking consumers about attitudes and perceptions.)

He advocates a "mash-up" of all three approaches for innovation. "Big data alone doesn't give you enough," he said, "and customer perceptions in research can be different from their actual actions. Intuition is dangerous; it's not reliable. So do it all."

Slonjsak also used the pyramid from Maslow's hierarchy of needs in a creative way, to show how operators could align with consumers' basic needs.

He feels always-on, reliable connectivity is a physiological need fulfilled by the operator, while service reliability creates trust with the customer, and fulfills the need for safety. He stressed trust as particularly important, noting the five-nines availability that telcos provide. For consumers considering a Bluetooth-powered door key as part of a smart home solution, for example, trust in the provider is critical. No one wants to be stranded, locked outside their home -- or come home to find their door gaping open.

He also felt operators could target the love/belonging element of Maslow's pyramid, by providing simple solutions that allow consumers to take on new services. They can then join a community that enjoys additional features and benefits.

But Slonjsak also warned that a difficult experience can damage that connection. He offered the example of Telekom Slovenije's own IPTV service. At a certain stage, the operator had outgrown its original platform, so it switched vendors and upgraded the platform. However, this left consumers struggling to navigate a new and very unfamiliar user interface overnight. The alienation resulting from this continued to be a challenge for this operator long afterwards.

Slonjsak closed his session with an interesting piece of advice: Don't ignore your paying customers.

Just as with the excitement around digital marketing methods and new technology deployment, there's a tendency to forget who is actually paying the bills. Millennials may be the coming generation, but they aren't willing to pay for anything. They want the cheapest connectivity options and free services. Baby boomers and Gen Xers account for most of an operator's revenue, so don't get so distracted by serving the needs of millennials that you forget older customers and the revenue they provide.

— Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation