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From Sticks to Carrots: Policy Control to Policy Engagement

Sat, 05/26/2012 - 6:35am
Chris Goswami, Director of Marketing and Communications, Openwave Mobility

This is a sponsored blog by Chris Goswami, Director of Marketing and Communications, Openwave Mobility.

Perhaps one of the most incisive quotes ever on customer care was from an executive at KDDI whose mantra to his own staff was: “unless it all works … it doesn’t work”. How appropriate for all those people in so many industries across the world who claim to be great at their jobs, but it’s not their fault if their colleagues in an adjacent department are lousy at theirs. I dont know about you, but for me, it conjures up images of the guy whose job it is to sell a train ticket at my station. He doesn’t know why the train is late, doesn’t care why it’s late …. and doesn’t like it when you ask him.Openwave logo

On the related topic of “low touch customer care”, Amazon founder Jeff Bezos recently told an audience in New York: “It’s already too late by the time you’re doing customer service. The best customer service is if the customer doesn’t need to call you, doesn’t need to talk to you. It just works” … How true! 

Both these points raise questions for the mobile data industry. “Making the whole thing just work” remains a serious challenge. Consumers don’t understand high technology complex data pricing or overage charges. And the customer care call center remains an area of high operating expenditure. It is estimated that a single call made to a call center has a fully-loaded cost to the operator of anything up to US$30.00. Clearly, getting customers not to call you has many advantages.

What matters of course is the total experience the customer sees. The growing field of Customer Experience Management (CEM) crosses all consumer industries and can be roughly translated as managing the customer’s total interaction with a product, brand, or service – across all channels including retail, online, mobile, TV, advertising, and of course, complaints. CEM highlights an increasing recognition that with internet-choice, internet-delivery and a glut of internet forums where everything imaginable gets reviewed, disenchanted consumers are finding it easier than ever to shop around and find a new supplier.

From Stick to Carrot

In our industry, the shape of this game is changing. Customer care and CEM is spreading backward from a strong focus on retail outlets and call centers, into the core network where it is largely driven by the operators’ Policy Management strategy. Policy Control and Charging (PCC) today provides the single point from which operators can make the greatest and most immediate impact on their CEM strategies and achieve significant differentiation.

Up to now Policy Management in mobile networks has been a defensive strategy to manage consumption – all about blocking and throttling or ensuring integrity of the network was preserved, and a traffic management strategy – ensuring that consumers only got what they were entitled to. We still need all of this, of course, but the emerging world of Policy 2.0 is much more customer-centric and focuses on mechanisms that extend subscriber choice in relevant ways, provides upsell opportunities, and, implemented intelligently, increases revenues.

Accordingly, in the latest policy tracker report from Heavy Reading, the proportion of operators in the world who have deployed a policy infrastructure has now risen to 50 percent, and the number of policy use cases implemented on this equipment will rise from an average of 3-4 per operator today, to around 20 use cases per operator in 2015.  Most of these are not concerned with traffic management but enhancing the user experience and generating new revenues. These use cases, for example, enable time of day, location, subscriber behavior, among other factors, to automatically lead to a specific QoS, price plan or promotional item being offered to the user at the users’ point of interest.

A similar report on Policy Management Software from Infonetics describes some of the latest policy-enabled use cases that operators are deploying including an Indonesian operator using policy to switch employee phone charges to a personal prepay plan after 6:00 p.m. and back to the corporate business plan the next morning. Again, this is application of Policy Management to enhancing the user experience and driving mobile data revenues.

A third report on mobile data charging from Yankee Group also lists new policy use cases including the US operator C Spire who is using policy infrastructure to sell video streaming as a separate, premium service to subscribers on low-cost plans. Does this really generate new data revenues? Well, C Spire is seeing significant numbers of subscribers who won’t pay for a video-inclusive plan, nevertheless, opting for a one-time “video pass” offered at the point of interest. Yankee Group actually rates these policy-driven, service-aware pricing approaches with a higher chance of success than any other pricing scheme they investigated in their report.

All these analysts, and many mobile operators, are discerning a change.

From Policy Control to Policy Engagement

As Policy becomes part of the operator’s wider CEM strategy, what we are seeing is increasing investment in a new area which we at Openwave Mobility term Policy Engagement.

Policy Engagement is the missing piece, the third leg of the stool of Policy Control and Charging. Up to now, the industry has focused hard on the policy decision and policy enforcement pieces – defensive blocking, tackling and basic traffic management – and is now moving to address the issue of how to meaningfully engage the end user. Policy Control and Charging allows us to do virtually unlimited things by offering users all kinds of QoS-based, content-based, demographic-based promotions and price plans. But all this can easily overwhelm end users. Policy Engagement driven by Mobile Analytics ensures that the offers actually made are the ones most likely to be of interest to that user at that point in time. Policy Engagement can make new mobile data plans and offers which are easy to understand and easy to adopt for the end user. Furthermore, as well as incremental revenues, it can even provide cost-savings through one-click access to relevant offers – in essence “user self-care”.

In summary, Shira Levine of Infonetics says in the above report: “The role of policy management is expanding beyond its traditional position in the network realm to encompass a new range of operator requirements. In many markets, operators are leveraging policy to experiment with new pricing and services, introduce subscriber loyalty programs and enable more sophisticated traffic management strategies”. As the industry moves to embrace wider aspects of CEM, by employing Policy Control and Charging, the focus is shifting from pure Policy Control to Policy Engagement.

Learn more about Policy Engagement in our upcoming webinar on December 11, 2012 at 12:00 p.m. EST. To register, visit: Subscriber Engagement - The Missing Link in Policy Control & Charging.

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