Uncovering hidden market potential: How digital brands are boosting operator revenues and market share

With increasing commoditization and sluggish revenue growth projections , the telecom market remains intensely competitive and heavily saturated. Against a lack of differentiation and highly homogeneous offerings, telecom subscribers struggle to see why they should stick with any one operator — a dynamic that fuels price wars and high subscriber churn rates. According to Sagacity’s 2022 report, more than a third (36%) of operators admitted to slashing prices after competitors did so, despite profit implications . Based on an analysis by Simon Kucher in 2023, a third of both mobile and fixed subscribers considered switching operators , a figure that continues to rise year-on-year.

At the same time, costs remain high. 5G, for example, involves substantial infrastructure expenditure and expensive spectrum licenses. Despite these outlays, 5G remains under-monetized as consumers find that its benefits, when compared to 4G, are not compelling enough to command a premium. Likewise, operators have not been able to truly differentiate their 5G offerings in a way that justifies existing higher prices, leading to slow adoption.

Thriving in a digital-first world

As the digital-native population continues to grow, so does the preference for digital or mobile-first services. Subscribers desire convenience, speed, and control over their experiences, and look out for digital service providers that offer these. This translates to a higher demand for streamlined, intuitive interfaces and a frictionless experience, where everything users need can be found and managed in one place, such as a mobile application.

Similarly, subscribers are opting for highly personalized or niche services. A one-size-fits-all approach no longer appeals to discerning subscribers who are ready to move from generic plans and packages to those that are tailored to their wants and needs.

For operators, these trends signal a clear mandate: they must evolve beyond conventional ‘cookie-cutter’ offerings to deliver highly customized services that are aligned to the diverse needs of their current subscriber base.

Making it 100% digital

One emerging approach is the digital brand – a brand that operates 100% online. These app-based brands offer a simplified portfolio of services that are targeted at niche subscriber segments. Digital brands address the gaps in mainstream mass-market offerings without cannibalizing the operator’s main brand. A digital brand can be an operator sub-brand or a flanker brand such as GiffGaff by O2, Ting Mobile by Boost Mobile, Voxi by Vodafone, FreedomPop by Red Pocket and Smarty by Three. A digital brand can also be next-gen mobile virtual network operators (MVNOs) such as Google Fi and Sky Mobile or traditional MVNOs such as Lebara and Lyca Mobile who are shifting focus to online audiences.

Digital brands boast transparent pricing models and attractive ‘no-contract’ arrangements, a stark comparison to today’s overly complex offerings with numerous hidden fees and administrative overheads. Digital brands leverage online interfaces to deliver a seamless self-service experience, appealing to the current generation of subscribers, particularly digital natives. Across onboarding, account management, billing and payments, service and support, and termination, these brands offer users the autonomy, flexibility and speed they need to keep up with their digital lifestyles.

Tapping into the untapped

Digital brands can be a powerful channel for addressing underserved customer segments such as those with a lower spending threshold and whose data and communication requirements do not warrant large quotas and a high service fee. Here, lower priced options that deliver basic voice, SMS and data essentials can attract users with smaller budgets.

There are also users who need continuous access to bandwidth-intensive applications on-the-go. For example, influencers and social media marketers are highly dependent on web and SaaS apps that offer video streaming, editing, uploading and sharing. A niche digital brand that optimizes connectivity and QoS for video applications, and offers extra-large data quotas, can become a brand of preference for today’s video-centric consumers.

Likewise, a digital brand that specializes in B2B services can offer enterprise-specific bundles that include premium routes, cloud-based productivity tools and always-on, real-time virtual assistants. A digital brand can tailor a fixed mix of connectivity and communication services that correspond to different tiers of small, medium and large businesses.

Similarly, a digital brand that specializes in IoT can package different connectivity services (mMTC, LTE-m and WiFi) with hardware and software solutions. By investing in advanced cloud platforms that commission, monitor and manage a plethora of connected ‘things’, an IoT-specific digital brand can power end-to-end deployments across various IoT use cases such as smart cities, smart homes and smart health.

In fact, operators can go beyond a single digital brand to launch not one, but multiple digital brands to simultaneously address the unique needs of various demographic and psychographic segments.

Capping costs and improving efficiencies

With no physical presence and a lean operating structure, digital brands promote cost-effectiveness. They cut down on customer service costs with automated and AI-powered account management and support. They reduce customer acquisition costs with targeted online marketing and advertising. Back-office and customer support processes are largely automated to support self-service operations, which improves efficiency and again, optimizes costs.

Digital brands support agility and flexibility as plans can be changed and new features can be launched rapidly, enabling brands to stay relevant and competitive without company-wide rebranding or system upgrades. They greatly improve time-to-market as brands can be rolled out within a matter of months.

Towards data-driven operations

Complete reliance on digital interfaces by digital brands leaves massive digital footprints in its systems, creating a treasure trove of deep customer insights encompassing interactions throughout the entire subscriber lifecycle. These include usage and access patterns, customer service engagements, purchases and subscription information, billing and payment data, in-app conversations and responses to targeted campaigns or offers. Digitally available customer information, consolidated in analytics engines, enables personalization of services and paves the way for contextual cross-selling and up-selling. Operators can also leverage this real-time data to test the take-up rates on new plans and services, gather feedback and refine their offerings accordingly. Enhanced with AI-powered predictive insights, subscriber behavioral analytics can be used to identify potential churn and address it pre-emptively.

Success stories

Vidéotron, a cable and broadband service provider in Quebec, Canada, launched Fizz, a 100% digital virtualized service provider (VSP) in less than 10 months and with fewer than 20 core team members. Fizz’s hybrid cloud architecture, powered by Etiya’s Digital Business Platform running on AWS, enabled an agile and flexible operating model that came with minimal investment and operating costs. With its 100% self-service model, Fizz operates with 90% fewer customer service representatives than comparable companies. Fizz’s cloud capabilities also enabled the VSP to introduce innovative features, including an exciting community hub, where both subscribers and non-subscribers can participate and earn ‘game’ points. The brand won TM Forum’s Excellence Award in 2019 for ‘Disruptive Innovation’.

Mint Mobile, a US-based MVNO that operates on T-Mobile’s network and targets cost-conscious customers, saw its revenue growing close to 50,000% between 2017 to 2020. Mint Mobile, which debuted in 2016, engaged social media and influencer marketing to boost mobile prepaid subscriptions, and has gained strong traction among the younger customer base without having to incur huge customer acquisition costs.

Verizon’s digital brand, Visible, positions itself as a ‘radically simple, accessible and inclusive digital service’. Launched in 2018 and running on Verizon’s 5G and 4G LTE network, the digital brand provides unlimited data and device Wi-Fi hotspot. The prepaid mobile brand has recently been recognized for delivering the best purchase experience among value MVNOs .

Lyca Mobile, a UK-based global MVNO which was set up back in 2006, has garnered over 16 million customers to date, with operations in 23 countries . Lyca Mobile focuses on providing low-cost, high-quality data and voice services via pay-as-you-go and pay monthly SIM plans, catering primarily to international users such as ethnic segments, travelers and students.

BSS for digital brands

For operators looking to deploy digital brands, a robust business support system (BSS) solution is essential. Etiya Digital BSS — an end-to-end BSS platform which includes customer relationship management (CRM), customer service management (CSM), configure, price, quote (CPQ), product catalog, order management, omnichannel digital frontend, revenue management, and an API gateway — provides cutting-edge capabilities needed to support these brands.

With Etiya Digital BSS, digital brands can be launched rapidly, offering baseline or disruptive price plans that are aligned to the brand proposition. The platform capabilities also support differentiating viral customer engagement schemes, including innovative loyalty programs with rich features such as advanced gamification, community building and AI capabilities. AI functionalities, specifically, enable the creation of hyper-personalized products and services that enhance acquisition and retention in niche segments.Advanced technical capabilities

Ensuring a digital brand operates smoothly 24/7 hinges on the scalability and performance of the BSS platform behind it. An ideal BSS platform should be able to scale infinitely to accommodate growth in user numbers, while keeping latency to a minimum to support real-time interactions across digital touchpoints. Etiya Digital BSS, for instance, is a cloud-native solution that can be deployed in the public cloud, enabling nearly linear scalability, better resource usage and lower operational costs. With ‘zero touch’ operations, digital brands can automate back-end processes and workflows entirely, enhancing operational efficiency and reducing the dependency on human intervention.

To support the flexibility and agility of a digital brand, a BSS platform should have zero- and low-code capabilities that enable operators to customize and introduce services, features, pricing models, and bundles on demand. Additionally, Etiya Digital BSS is built on a microservices-based architecture that allows operators to rapidly deploy new features and functionalities as and when necessary.

For operators planning to launch more than a single digital brand, it is important that they have in place BSS capabilities that support multiple, disparate brands. This circumvents the need for duplicate systems or resources, while maintaining unique interfaces, communication channels and messaging for each brand. Etiya Digital BSS tackles this with its newly-launched Multi-Brand Management feature.

Lastly, in order to take advantage of the data available to a digital brand, a BSS platform should come with advanced AI capabilities. Etiya Digital BSS leverages machine learning (ML) algorithms, natural language processing (NLP) techniques, Digital Twin models, integrated predictive analytics and next best action (NBA) recommendations to deliver the necessary insights and analysis that enable smarter decision-making and better personalization.

Rich customer facing features

A comprehensive BSS solution used for digital brands should be able to support operations that are run entirely on a self-care and self-service basis. From onboarding to termination, a customer should be able to self-manage their accounts via various channels, including operator apps, chatbots, websites and social media platforms. The BSS solution should thus ensure a consistent, omni-channel experience, with an accurate and updated subscriber profile, order and usage information, and transaction history, to ensure no manual intervention or offline interaction becomes necessary.

Partner qualities

There are a number of aspects that a digital brand must consider, beyond technical specifications, when choosing its BSS partner. Foremost is a proven track record. Etiya boasts decades of experience and excellent service and support. By continuously adapting its solutions, operating models and pricing strategies based on changes in market demands, Etiya offers digital brands a lifetime partnership and sustained success. Beyond this, a BSS solution must support interoperability and conform with industry standards. In this case, Etiya Digital BSS is readily compliant with TM Forum’s ODA standards and principles, and Open APIs. Additionally, Etiya’s solution also comes with a managed service model which allows digital brands to maintain a lean setup, yet enjoy specialized and highly customized BSS capabilities.

Towards a digital future

With more aspects of human life becoming digitalized, digital telco brands will redefine connectivity services, addressing not just market gaps but also providing customers improved choices and services that better meet their needs. A powerful BSS tool is the crucial first step towards this goal, ensuring agility, speed and responsiveness against fast-changing market demands while equipping players with comprehensive insights that enable them to craft brands that sell.

Ready to see how Etiya’s Digital BSS can drive growth for your digital brand? Contact us today for a personalized consultation.