How to retain more telco customers

Customer churn is a major challenge for telco providers all over the world. Nicolas Engel, Director, Global Services at Cybersource, discusses how a seamless payment experience and effective protection against fraud can help telcos seize the opportunity to win and retain more customers.

Because today's telco market is highly competitive, and because it's easy for people to switch providers, customer churn has become a real issue within the industry. But in every challenging situation, there's always an opportunity to be found. A telco that's able to provide superior experiences can take advantage of churn to win new customers, keep its customers happy, and build loyalty with them over the longer term.

Why seamless payments are important for telcos

Payment is one of the most important experiences in the telco–customer relationship. Making payment easy and seamless is a way to help keep consumers on side. On the other hand, a bumpy payment experience can lead to a customer questioning the entire relationship with their existing telco provider, and potentially looking for a better one elsewhere.

New customers: Tell the good from the bad

If your competitors put new customers through a clunky verification process at checkout, you can stand out by providing an experience that's fast and painless—without raising your fraud risk. 

Even if you know nothing about a new customer, you can use a fraud detection tool that draws on authenticated identity data from trusted third-party sources (alongside the credit checks you do as a matter of course) to help you make that decision quickly and transparently at checkout. 

As well as streamlining the checkout experience, this approach can help you:

• Accept more transactions
• Reduce the chance of declining good orders
• Increase your authorisation rates

How tokenisation helps with retention

Customers want choice about how they pay, and they also want the payment process to be easy. Having to enter payment details or other credentials each time they add a service or renew and contract can put them off, which could lead to a lost sale or even a lost customer. 

This is much less likely to happen if you can always recognise returning customers. You can do this by using a token management service to add a unifying layer on top of all the network tokens you use with your acquirers. 

This creates a single token that provides a 360-degree view of each customer. Using this token lets you recognise and track a customer across devices, services, channels—and even across your own brands—no matter how they choose to pay. As well as reducing the data entry burden for consumers, this ability to recognise customers opens the door to sophisticated omnichannel marketing strategies that can further boost loyalty.

Make recurring payments frictionless 

You'll want to minimise any issues with recurring card payments that could prompt customers to look at competitors' deals. 

One way is to take recurring payments on the day of the month when a customer is most likely to have the funds in their account (a day or two after their salary comes in, for example). That way, you minimise the chance of a payment being refused for lack of funds. And to avoid bothering customers with requests for new card data when an existing card is expiring (or being replaced for another reason), consider using a token management service for automated, real-time card-on-file updates. 

You should also consider choosing a payment service provider whose platform is highly available, to reduce the chance of any downtime affecting payment processing.

Protect your customers against fraud

People's reliance on mobile phones has been accelerated by the global pandemic and by the Strong Customer Authentication (SCA) requirement of PSD2 (in regions where it applies). The personal and payment data that so many phones now contain, and the role of SMS messages in SCA, makes phones (and telco account data) an increasingly attractive target for fraudsters. So securing them is more important than ever.

To authenticate fraudulent transactions that are in scope for SCA, fraudsters may attempt to intercept SMS messages or perform SIM swaps or hijackings. They may steal payment or telco account data to make fraudulent purchases, ranging from expensive devices to intangibles like SIM-only contracts that may be used for criminal activities.

To help keep your customers safe, you need to combine an effective fraud screening tool with a solution that protects against account takeover. You should also make education about fraud protection a part of your regular customer communications.

To learn more about transforming churn into growth with seamless payment services and effective fraud management, download our Cybersource guide.