The first ‘authentic’ audit of loyalty among UK mobile
subscribers, released today by WDS, A Xerox Company, has
worrying implications for mobile operators. The WDS 2013 Mobile
Loyalty Audit, integrating new survey data from research
specialist TNS, reveals that 38% of UK subscribers are
considering leaving their mobile operator in the coming 12
The audit also finds that only 12% of customers show the
level of loyalty required to protect them from competitive
offers and service disruptions.
For the first time, the WDS 2013 Mobile Loyalty Audit uses
“stress-tests” to show the impact of real-world disruptions on a
customer’s propensity to churn and deliver a realistic view of
the level of loyalty that exists in the UK. When stress-tested,
the audit found customers’ positive sentiment towards not
switching could be easily reversed, for example:
What if your current mobile operator increased prices by 10%?
67% of customers who were previously unlikely to switch would
now consider leaving.
14% of them would switch immediately without further
57% of highly satisfied customers would also consider
13% would leave without further consideration.
What if another operator could reduce your monthly tariff by
Only 34% of customers who were previously unlikely to switch
could guarantee that they wouldn’t leave for this saving.
What if there was a privacy breach?
85% of those that said they were unlikely to switch would now
42% of them would switch immediately without further
39% of highly satisfied customers would switch immediately.
The study suggests that the number of customers at risk of churn
could be underestimated by operators. Additionally, many
existing measures of loyalty, such as customer satisfaction and
Net Promoter Score (NPS), often deliver overly simplistic and
potentially misleading results. For example, the WDS audit found
that 17% of customers currently considered a 'switch-risk' are
actually highly satisfied with their mobile operator. Likewise,
15% were NPS Promoters.
It also showed that one fifth of all customers staying with
their current operator this year are doing so not through any
sense of loyalty, but because they feel that “all mobile
operators are the same” and that there is no benefit in
“We’ve been measuring loyalty in a vacuum; assigning valuable
retention budget based on customer sentiment and an out-of-date
notion of what loyalty actually is,” says Tim Deluca-Smith, Vice
President of Marketing at WDS.
“A customer might say that he is satisfied or that he has no
intention of switching, but how does that sentiment change when
there’s a network outage or his monthly tariff increases?
Loyalty means more than just a customer’s intent to repurchase –
this is only as good as the next handset subsidy or price
discount. True loyalty creates customers that are forgiving when
things go wrong and resistant to competitive offers.”
The WDS Loyalty Audit also debunks some of the common myths
around customer churn. In particular that customers switch
primarily because of price, availability of devices or network
Across each of these, the majority of at-risk customers were
actually satisfied with their current operator’s performance.
Just 25% thought they got poor value for money, 21% that network
coverage was poor and 13% that availability of devices was
Instead, it seems operators are failing to create a feeling of
“value” and “reward” among many of their customers. Over 40% of
those at risk of switching felt they weren’t valued or rewarded.
In fact the data shows that if a customer doesn’t feel valued
they are more than twice as likely to become a switch-risk.
The study concludes with many positive take-aways for mobile
operators looking to better manage customer loyalty. In
particular the study emphatically shows how some service
elements are more influential in building, or damaging, loyalty
While a single interaction with customer support is relatively
benign in its loyalty influence, customers that have to contact
customer support more than once in a six-month period are twice
as likely to be a switch-risk.
Getting any kind of care interaction right is critical. A
customer who rates the performance of customer care as
“Excellent” is nearly four times more likely to be secured
beyond 12 months than someone who rates the experience as
Basic network hygiene factors remain vital. 73% of respondents
who rated network coverage as “Excellent” are unlikely to
Retention budget can be better deployed and many expensive
rewards programs are not working. Their value is unproven in
creating long-term loyalty and 82% of customers felt they
weren’t adequately rewarded through existing programs.
“Building trust, developing a sense of value and sustaining
strong customer service are fundamental to securing long-term
loyalty; especially given the level of parity that exists
between operators’ pricing strategies and network performance,”
“Satisfaction alone is no longer enough, in fact it’s
become little more than a cost of doing business. The WDS
Loyalty Audit shows that only 12% of UK customers have the level
of loyalty we deem necessary to insulate them from competitive
offers and service failures. Understanding who these customers
are will help operators to better understand the customers at
risk and deploy retention programs that build a more emotional
and resilient tie between customer and brand.”