IBM 2014 Global Telecommunications Consumer Survey Insights

© 2014 IBM Corporation
IBM Institute for Business Value
Social Media and the Empowerment of
African Consumers
Rob van den Dam
Global Communications Industry Leader

IBM 2014 Global Telecommunications Consumer Survey
22,000 consumers in 35
countries took part in the
survey, covering:
 Customer Spending
priorities
 Adoption of Comms
services
 Sources of Information
 Customers’ attitudes
towards CSPs
 Customer Advocacy
 Customer Trust
2
2014 IBM Global Telecommunications Consumer Survey

IBM 2014 Global Telecommunications Consumer Survey
3
2014
Global Telecom Consumer Survey
China
(1265)
Australia
(652)
Canada
(594)
Belgium
(323)
Brazil
(671)
Denmark
(319)
Egypt
(343)
India
(1038)
Finland
(309)
Greece
(738)
France
(1343)
Germany(
831)
Indonesia
(735)
Ireland
(351)
Mexico
(658)
Italy
(560)
Malaysia
(506)
Japan
(964)
Kenya
(322)
Netherlands
(548)
New Zealand
(464)
Russia
(1003)
Nigeria
(550)
Poland
(328)
Norway
(303)
Philippines
(877)
Saudi Arabia
(306)
South Africa
(649)
UAE
(320)
Spain
(809)
Turkey
(533)
Sweden
(354)
Thailand
(616)
UK
(657)
US
(1083)

Africa still has the lowest telecommunication penetration rates, but is
experiencing the fastest growth in mobile and internet users worldwide
4
Mobile Penetration:
71%
Internet Users: 39%
Mobile Penetration:
73%
Internet Users: 38%
Mobile Penetration:
147%
Internet Users 49%
Mobile/Cellular Penetration 69%, but
HIGHEST (‘13/’14) Growth: 5,2%
Internet Users 19%, but
HIGHEST (‘13/’14) Growth: 13%
Mobile Broadband Penetration 19%, but
HIGHEST (‘13/’14) Growth: 43%
43%
21% 19% 16% 15% 12%
AFRICA
Asia&
Pacific
Arab
states
Americas
CIS
Europe
Asia&Pac: 920 Mio
Americas: 577 Mio
Europe: 399 Mio
Africa: 172 Mio
CIS: 138 Mio
Arab: 92 Mio
ITU Statistical data base
Nigeria
Kenya
S. Africa

Africa claims to be the ‘Mobile Continent’ and the results of our
consumer survey confirm this statement
5
How often do you access the Internet through the following?
73%
57%
25% 20%
8%
12%
21%
7%
19%
30%
55%
73%
0%
20%
40%
60%
80%
100%
Daily Weekly Occasionally
Including
Home
WiFi
Public
WiFi
Mobile
Global (weighted average of 35 countries)
Including
Home
WiFi
Public
WiFi
Mobile
66%
72%
20% 17%
0%
20%
40%
60%
80%
100%
Daily Weekly Occasionally
36%
88%
20% 20%
45%
85%
31%
20%
Kenya
Nigeria
S.Africa
African countries
Source: 2014 IBM Global Telecom Consumer Survey, How often do you access the INTERNET through the following?

6
53%
50%
40%
36%
28%
22%22%20%20%19%
13%13%13%12%12%10%8%
6%5%5%5%3%2%0%
-2%-4%-4%-5%
-8%-8%-10%
-15%-15%-16%
-37%
Greece
Ireland
Italy
Netherlands
Belgium
Spain
Poland
Philippines
Japan
UAE
France
Germany
UK
US
Sweden
Finland
Canada
Malaysia
Norway
Australia
Mexico
Russia
Denmark
NewZealand
SaudiArabia
Brazil
SOUTHAFRICA
Egypt
Turkey
Indonesia
Thailand
India
China
NIGERIA
KENYA
Net Decrease/Increase Consumer spending
MOBILE BROADBAND usage (Internet from Mobile)
(2014 – 2016)
Question: Compared to previous years, are you likely to spend less, the same or more on mobile phone usage (voice calls, SMS, MMS) in the next 2-3 years?
Consumers in African countries expect to increase spending on
accessing the mobile Internet

7
24% 19% 57%
25% 18% 57%
25% 17% 57%
32% 19% 49%
49% 17% 34%
57% 18% 25%
74% 12% 14%
80% 11% 9%MOBILE PHONE
LAPTOP / NETBOOK
Desktop PC
TABLET
Internet-enabled TV
GAME CONSOLE with
Internet connection
eReader
OTHER (e.g. Internet-
enabled Blu ray player)
Very Valuable Moderately valuable Little valuable / Not applicable
How valuable is each of the following devices for you to access the Internet?
For accessing the Internet, the mobile phone has become the most
valuable device
92%
89%
88%
Mobile Phone
‘Very Valuable’
Question: How VALUABLE are the following devices for you to access the Internet?

8
Question: How often do you use the following communications services?
Daily usage communication channels in EMERGING markets
in EMERGING
MARKETS use
Social Networks
daily to communi-
cate with others
74%
28%
25%
45%
26%
25%
36%
37%
50%
61%
65%
66%
74%
82%
30%
55%
58%
71%
66%
79%
76%EMAIL
SOCIAL NETWORKING
MOBILE MESSAGING
INSTANT MESSAGING / Chat
MOBILE VOICE calls
INTERNET VIDEO streaming/download
FIXED VOICE calls
MICRO-BLOGGING
VOIP (VOice over Internet)
VIDEO CALLING
All AGES
AGE < 25
2
1
People increasingly access the Internet to communicate with others;
Social Networking is the # 2 communication channel in emerging markets

In the African countries, use of Instant Messaging and Social
Networks to communicate with others is high
9
Daily usage communication channels
Question: How often do you use the following communications services?
Mobile Voice
Email
Social Networking
SMS/MM
Internet video
Email
Social Networking
Fixed Voice
87%
91%
76%
57%
45%
64%
96%
80%
81%
69%
57%
67%
IM/Chat
SMS/MMS
Mobile Voice
IM/Chat
IM/Chat
Mobile Voice Call
Micro-Blogging
SMS/MMS
Social Networking
Email
Social Networking
Internet Video
IM/Chat
Mobile Voice Call
Email
81%
82%
81%
69%
65%
74%
85%
79%
84%
76%
49%
75%SMS/MMS
Mobile Voice
Email
Social Networking
SMS/MMS
Micro-Blogging
IM/Chat
Email
Social Networking
88%
90%
87%
78%
69%
79%
91%
87%
90%
80%
61%
73%
SMS/MMS
Mobile Voice
IM/Chat
Micro-BloggingMicro-Blogging
Under 25
Above 25

10
12%
57%
31%
Reduce(d)Increase(d)
No Change
15%
52%
34%
Reduce(d)Increase(d)
No Change
Reduction
SMS usage
Reduction
traditional
voice calling
of respondents said they
have reduced – or will reduce
– SMS usage by increasingly
using alternative messaging
channels
34%
of respondents said they
have reduced – or will reduce
– traditional voice calling
by increasingly using
alternative voice channels
31%
GloballyGlobally
Because of these OTT channels, many respondents said they
decreased – or will decrease - spending on traditional communication
To what extent have you reduced – or will you reduced SMS usage and traditional voice calling by increasingly using alternative channels?
56%48%43%
0%
20%
40%
60%
South
Africa
Nigeria
Kenya
43%36%33%
0%
20%
40%
60%
South
Africa
Kenya
Nigeria
Global Global

11
in emerging
markets access
Social Media to
evaluate telecom
providers and their
products /services
69%
9%
20%
25%
28%
34%
48%
60%
69%
72%
23%
19%
13%
31%
56%
33%
69%
Internet SEARCH
SOCIAL MEDIA
RECOMMENDATIONS friends/family
Telco WEB sites
Telco EMAILS & promotional offers
Traditional ADVERTISING
Retail STORES
Shopping PORTALS/auctions
Emerging Markets
Mature Markets
Sources of information on telecom providers and their products/services
The web, social media and word-of-mouth now dominate the traditional
channels for information relating to Telcos and their products/services
Question: What are your preferred sources of information when you are evaluating telecom providers and their products/services?

12
28%
50%
69%
72%
79%SOCIAL MEDIA
Internet SEARCH
RECOMMEND F/F
CSP web sites
Retail STORES
36%
49%
55%
58%
77%Internet SEARCH
RECOMMEND F/F
SOCIAL MEDIA
CSP web sites
Retail STORES
35%
54%
65%
75%
81%SOCIAL MEDIA
Internet SEARCH
RECOMMEND F/F
CSP Websites
Retail STORES
37%
39%
57%
67%
75%Internet SEARCH
SOCIAL MEDIA
RECOMMEND F/F
Retail STORES
CSP websites
<25
Social Media is a frequently used source of information in the African
countries
Sources of Information on telecom providers and their products/services
Question: What are your preferred sources of information when you are evaluating telecom providers and their products/services?

Word-of-mouth is important as it has become a key factor in
condidering a provider for products and services
13
15%
21%
22%
22%
43%
46%
51%
52%BEFORE BUYING when the provider provides information
When contacting my provider for RESOLVING AN ISSUE
BEFORE CONSIDERING the telecom provider
(REPUTATION)
On first purchase or BEGINNING OF SERVICE
When my provider PROACTIVELY ask for my experience
When I CONSIDER SWITCHING to a competitor
On receiving FIRST INVOICE
Close to the END OF SUBSCRIPTION period
3 59%
56%
52%
2
2
2
Key moments of interaction that matter
Question: What are the key moments in interacting with your telecom provider that matters to your?
Global
Importance
Word-of-Mouth
Reputation

Negative word-of-mouth can have a strong negative impact on a
telco’s reputation and, consequently, its business performance
14
10% 49% 42%
13% 62% 25%
20% 46% 35%
21% 46% 32%
25% 57% 18%
26% 59% 15%
29% 50% 21%
38% 55% 8%
40% 50% 9%
41% 49% 9%START considering COMPETITIVE services from other providers
Would TELL OTHERS about the bad experience
Would COMPLAIN to my telecom provider
Would DISCOURAGE OTHERS to use this provider
Would use the services of my provider LESS FREQUENTLY
Would STOP making PURCHASING from my provider
Would post a NEGATIVE REVIEW or comment ONLINE
Would COMPLAIN on SOCIAL MEDIA
Would NEVER USE my telecom provider again
NO CHANGE in behavior
Always/Often Regularly/Possibly/Sometimes Never
Customer responses in case of NEGATIVE experiences
Question: What would you do in case of a NEGATIVE experience with your telecom provider?
Global

15
54% 54%
42%
31%
23%
67% 66%
33% 36%
20%
66% 64%
33%
49%
23%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Too much
hassle to get
through to the
Call Centre
Have to wait too
long in queue to
speak to Call
Centre
Don't believe it
make any
difference
Networks
unreliable
anyway
My Provider is
unable to
resolve my
problems
South Africa Kenya Nigeria
Always/often
complaining to
provider
Reasons not complaining to provider in case of negative experience
Question: If you not complain to your provider in case of a negative experience, what is the reason?
Telcos are not always aware that consumers have bad experiences:
less than half of consumers always/often contact them in those cases
49%
45%
44%

Word-of-mouth is an effective way for consumers to seize control on
some business decisions
16
12/29/11 Press Release:
“Starting January 15, a new $2 payment
convenience fee will be instituted for
customers who make single bill
payments online or by telephone”
Within 24 hours, more than 100,000 people
had signed a online petition: …. Your company
should not assume that it can do anything to
your customers and that we will allow it to
happen…
12/30/11 Press Release:
“Verizon Wireless has decided it will not institute
the fee for online or telephone single payments
that was announced earlier this week.
The company made the decision in response to
customer feedback about the plan…”

Word-of-mouth can also help a telco increase brand strength in case
of a positive experience, but what do customers perceive as ‘positive’?
17
Always/often
recommend
provider
72%
70%
69%
Top 6 POSITIVE experiences that make a customer LOYAL
Question: What are the most important experiences for you to STAY LOYAL to your telecom provider?
38%
40%
44%
57%
70%
90%
Quality COMPELLING products/services
QUICK effective responses to questions
Resolving issues FAIRLY
PERSONALIZED & consistent service
EXCLUSIVE offers (loyalty program)
LOW PRICES relative to competitors
53%
56%
45%
55%
75%
88%
TRANSPARENCY & openess
64%
45%
44%
63%
59%
83%
PERSONALIZED & consistent service

Telcos are not leaders in customer advocacy by any customer
advocacy measure
18
No Telcos in Top 25
Telecom lowest among 7 industry groups
No Telcos in Top 50
No Telcos in Top 50
No Telcos in Top 100
Wireless industry ranked 44 of 50 industries
No Telcos in Top 50
Only one Telco in Top 100, O2 at #46
Customer Loyalty Metrices

IBM’s ‘Advocacy Index’ measures the level of advocacy by analyzing
responses related to recommendation, buying and staying intent
19
IBM’s ‘Advocacy Index’
measures the level of advocacy by analyzing responses, specifically
related to recommendation, purchase intent and staying intent
Likelyhood to
Recommend
Buying
Intent
Staying
Intent
Willingness to recommend one’s primary provider to
friends and family
A willingness to increase one’s purchases if one’s
primary provider expanded its assortment and offered
products currently found only at the other providers
A willingness to stay with one’s primary provider, even
if other provider begin offering competitive producers
or Services

The emotive and personalization aspects seem to make the
difference between advocates and antagonists, not low prices
20
Global average: POSITIVE experiences that make a customer LOYAL
Advocates
have a
higher
wallet
share and
are highly
compli-
mentary of
the
provider
capability
Antagonists
have low
wallet share
and high
support
costs and
are prone to
bad-mouth
the provider

Telcos should look outside their industry for leadership in providing
customer experiences that drive loyalty
21

22
Groups
Individuals
Reactive Proactive
Mine
Conversations
Crowdsource
Insights
Reply to
Questions
Influence
Influencers
Today Next two years
Respond to
customer questions
Solicit customer
reviews and opinions
Capture
customer data
Identify and manage
key influencers
79%
79%
47%
68%
47%
68%
35%
59%
Applying social approaches to ‘listen & engage’ customers
(±2/3 of telco respondents in Social Business survey)
Source: Institute for Business Value, 2012 Business of Social Business Study
(% CSPs with customer-related social business activities)
An increasing number of Telcos are implementing social business to
understand customers and engage with them in new and different ways

Some Telcos are even proactive in understanding services issues by
trolling social networks to understand sources of dissatisfaction
23
O2's Twitter team
demonstrate their
social media moves
on angry tweeters
London, July2012
O2 UK experienced widespread network
problems affecting hundreds of
thousands of its customers in July 2012,
user anger was boiling over, with many
customers expressing their
dissatisfaction on Twitter. O2, however,
turned the tides, by using Twitter to
deliver fast, professional customer
response and was able to maintain their
brand image by adding humor and
personality to their tweets
Having the official verified Twitter
profile @Airtel_Presence, Airtel scan
for every tweet containing the word
“airtel” in it and giving appropriate
replies to customers and solving their
issues.
Airtel uses social network analysis to
determine customers’ facing problems.
Any mention on social media
(Facebook, Orkut, Twitter, etc.) is
captured and they get in touch with the
customer to get issues resolved.

24
of respondents like to
interact with their
provider on improving
an existing product
60%
60%
56%
38%
26%
22%
22%
21%
6%
IMPROVEMENT EXISTING Product/Service
IMPROVEMENT CUSTOMER CARE
DEVELOPMENT NEW Product/Service
FEEDBACK on COMMUNICATION to market
FEEDBACK on Overall STRATEGY
IMPROVEMENT of Existing CAMPAIGN
DEVELOPMENT of New CAMPAIGN
Other
Social approaches also help to solicit ideas from consumers to
improve products or services or create new ones
Topics customers are willing to communicate on with their provider
% of respondents
willing to provide
feedback or input
Global
On which topics do you want to provide feedback or communicate with your Telecom Provider to help the organization to improve?
98%
97%
85%

A number of CSPs are already connecting to consumers to launch
new services based on their input
25
EE engaged with consumers
on its Orange brand to co-
create the clone phone1
 EE needed inspirational
mobile service ideas that
people would love
 EE collaborated directly with
their customers and experts
outside of their own field for
more than six weeks to co-
create the clone phone
Telenet developed a mobile TV
App with support customers2
 Telenet invited users to
participate in the development
of Yelo, an application for digital
TV on mobile devices
 Participants were recruited to
join a three-week closed pre-
launch community to allow
collaboration on improvements
http://www.inc.com/diane-hessan/mobile-giant-
used-consumer-collaboration-to-innovate.html
http://www.insites.
eu/researchcommunities/telenet/yelo-community.aspx
China Telecom analyses insight
from consumers to envision and
develop new services3
 An innovation platform enables
marketing teams connect to
consumers to gather new
intelligence directly from con-
sumers to launch new services
 Publication of the first idea a mere
ten minutes after launch
http://www.businesstimes.com.sg/sites/
businesstimes.com.sg/files/China%20Telecom.pdf

However most CSPs don’t yet get social, only a third of the respondents
feel their provider uses social media effectively to engage with them
26
10% 25%
11% 27%
13% 31%
14% 32%
23% 38%My Telecom Provider allows me MULTIPLE
WAYS to interact and communicate with them
My Telecom provider LISTENS TO ME and
collects the right amount of information to meet
my communication needs
My Telecom Provider USES THE INFORMATION
it already has about me rather than asking me to
provide it repeatedly
My Telecom Provider enables me to provide
FEEDBACK or to provide input to develop new
communication products and services
My Telecom Provider uses SOCIAL MEDIA in an
effective way to engage with me
Strongly agree Moderately agree
of respondents agree
that CSPs use Social
Media in an effective
way to engage with them
Globally,only
35%
How good is your primary telecom provider in interacting with you?
Indicate to which agree/disagree with the following statements on your Primary Telecom provider?

27
Percentage underprepared
for Social Business
85%
66%
55%
Lack of a cohesive
social media plan
Lack of appropriate
technology
Legal and security
concerns
Lack of leadership
support
Concerns about
inappropriate use
Competing priorities
or initiatives
Difficulty measuring
investment returns
64%
34%
39%
25%
15%
52%
59%
Underprepared
for the
necessary
cultural changes
Unsure about
impact of social
business over
next three years
Limited
understanding of
the business value
we intend to obtain
Challenges Telecom CxOs to
implementing a digital strategy
Lack of a cohesive social media plan and problems with measuring
ROI are the two biggest barriers to doing more in the digital space
Source IBM 213 Global C-suite study (218 telecom CxOs) –How strong is your collaboration with customers?;

28
What’s the most natural way
to initiate collaboration?
Which self-service option is
the best investment?
What channels
will deliver the
best ROI?
How can you understand
consumer frustrations even
when they don’t call about it?
What’s the weight of
consumer sentiment
gathered from social
media?
How Social
are you?
What are the best
means to get deeper
insight about your
customers?
Which elements of the customer
experience are most important for
your customers and how do you
measure those?
Questions for you

29
Thank you
Rob van den Dam
Global Communications Industry
Leader
rob_vandendam@nl.ibm.com
www.ibm.com/iibv

IBM 2014 Global Telecommunications Consumer Survey Insights

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