Powerful Customer Segmentation through Artificial Intelligence

Saudi Arabia-based telecommunications operator, Saudi Telecom Company (stc), uses artificial intelligence (AI) and machine learning to segment and connect with its customers in highly personalized ways.

What are your mobile behaviors? Are you an online shopper? A gamer? Do you stream content? Are you a social media influencer? Or more of a sports fanatic? Or are you constantly downloading movies, music, and podcasts? Do you know what customer segment best describes your mobile behavior?

Mobile use is shaping customer behaviors.

With smartphones becoming an extension of ourselves, stc seeks to know how their customers are using them in deeper, more meaningful ways. Why are their customers using mobile as part of their journey? What kind of content and experiences do customers expect to be provided to ensure further engagement, consumption, conversion, and return? Answers to these questions are helping to shape how stc connects with customers in highly relevant and personalized ways to accelerate their growth and meet corporate KPIs.

A new corporate strategy to position this forward-focused digital champion.

Ranked number nine in market cap among the top 25 telecommunications companies by revenue, stc has its sights on climbing the ranks.

To stay ahead and continue focus on innovation and evolution, stc set forth on a new corporate strategy in 2019, DARE, to expand their topline, create value with greater efficiencies, and prepare the company for the future. stc realized big data and analytics are key enablers that will support distinguished services and deliver growth. The DARE strategy is to:

Digitize stc: transforming into a data-driven organization to improve experience, enhance performance and drive efficiencies,

Accelerate core asset performance: by extracting more value from core assets and traditional segments,

Reinvent customer experience at world-class standards: by redefining customer experience through personalization of every interaction, and

Expand aggressively scale and scope: by pursuing concrete opportunities for growth via adjacent services, applications, platforms, connectivity, and infrastructure.

Saudi Telecom Company (stc) by the numbers

41M+

mobile subscribers

29M+

mobile broadband subscriptions

70M

mobile minutes
per day

SMS messages
per day

Luca Decarli General Manager

Luca is a top leader, influencer, versatile customer-focused professional and innovator with strong international expertise ranging advanced analytics, big data, CRM, sales, marketing, customer experience and consultancy. His expertise has brought forth successful projects and strategy implementations within customer lifecycle management, customer relationship management, sales and marketing, BI and big data for global telecommunications providers.

More than 400 KPIs measure stc’s success against its DARE strategy. ‘Quality of Experience’ stands out as a key categorical measure of stc’s progress against its corporate strategy.

Creating a superior customer experience means stc’s customers become stickier, are willing to upgrade, accept a cross-sell, or upsell more frequently which drives stc loyalty. However, before stc can accelerate growth in their traditional business through upsell and cross-selling opportunities, they must ensure that customer experience is simplified to minimize customer disruptions, making stc easy to do business with.

‘Quality of Service’ starts with optimizing calls through reducing call setup times, preventing unsuccessful dropped calls, maximizing speech connection quality, and maximizing internet connectivity and bandwidth speeds. However, optimizing phone and internet services quality is just the start. Should an issue arise, stc looks across its digital and call center channels to minimize disruption and inconvenience to its customers. Response times to call centers and disruption resolution are key indicators where ‘Quality of Experience’ may be monitored and improved upon.

Using the nPath analytic function in Teradata Vantage™, stc connects structured and unstructured data of customer interactions across its digital, mobile, and voice channels.

Should a dropped call lead a customer to stc’s website, who then engages in an online chat, ultimately advancing into the call center, stc acts in real-time by preparing its digital and call center agents with context to the customer’s interactions so that agents are better prepared to serve and act.

Visualizing the customer experience using nPath

“nPath analysis takes care of omni-channel transactions within 24 hours for every single customer. For example, identifying a customer logged a complaint, or faced an issue when recharging their phone or attempting to pay their bill.

nPath analysis helps us to identify if the customer has one, two, three, or four interactions with the call center or digital channel before the problem is resolved. If this is the case, then we identify what went wrong on the steps three and four. We train the call center agents to give them the ability to solve the problem at the first call resolution.

This means we save a lot of calls and we make sure that the customer is happy right after the first call.”

Luca Decarli, General Manager

With improved customer service experience, stc turned attention to growing sales and revenues within its traditional business by understanding and connecting with customers, creating highly targeted and personalized marketing campaigns and offers.

Over 400 attributes categorize stc’s customers into 14 primary behavioral customer segments. In practice, this number grows into the hundreds for precision customer segmentation. Using artificial intelligence, stc’s models and algorithms categorize, assign, and optimize current and past customers into these customer segments, continuously optimizing segmentation for the most effective customer targeting. All of which is done in Teradata Vantage.

Vantage supports Artificial Intelligence.

“We have the needs, attitudes, and the behavioral customer segmentation of about 400 attributes. We found out, with the help of artificial intelligence, that the behavioral patterns are changing over time. So, every month you have to redo the segmentation. One example is changing societal norms in the Kingdom of Saudi Arabia. Consumption has changed. This is a good example of how we use artificial intelligence to monitor those 400 attributes and monitor changes over time.”

Notable behavioral customer segments data includes:

Gamers

Multiplayer, console, strategy, occasional

Shoppers

Fashion, all purpose, electronics, groceries

Streamers

Video lovers, music, live sports, on-demand

Social media users

Geeks, chatters, professionals

Travelers

Hotel seekers, holiday planners, explorers

Downloaders

Heavy, occasional

Finance gurus

Brokers, insurance, 360 bank users

Sports fans

Football (Euro, SPL, others), cricket, others

Upgrades, upsells, cross-sells, and mitigating customer churn via next-best action and next-best offer analytics

“Artificial intelligence is giving us near real-time ability to change a message that will be displayed to the customer, taking into consideration the fact that the behavior has changed, and the customer might be prone to churn. Therefore the tonality of the message and the offer itself has to be changed.”

Additionally, artificial intelligence coordinates the offers nightly, ranging from two to five unique, potential offers and services for every past and present customer. Once offers are defined, Teradata Vantage applies AI and machine learning to recalculate its models on the fly for real-time decisioning, scaling to over 50,000 highly targeted, personalized marketing campaigns per month. Success breeds success. stc is executing over 50,000 campaign a month! Some targeted to just a few hundred in a segment!

“With a library of more than 1,000 different offers, machine learning helps to identify what the best results are over time because we have a lot of A/B testing. We have a lot of experimentations and it helps us to identify what, at a particular moment, a customer in a particular location is looking for.”

Less spam and more relevance make customers feel like stc knows and understands them.

With all of this behavioral analysis, stc connects with customers in ways others cannot. For stc, they see a substantial return in customer take rates of its offers.

“If you have a campaign that is one message for all, typically campaign take rates return is 0.5-1%. Our campaigns with a dedicated base of needs, attitude and behavior, plus a real-time event may go up to 30-45% take rates, which is incredible. The return on investment and take rates, it’s much, much higher.”

As take rates continue to far outperform industry standards, stc sees big data and analytics as a core component fulfilling their corporate DARE strategy to expand their topline and create value with greater efficiencies.

stc’s big data and analytics efforts of personalized experiences and offers has far exceeded expectations, achieving 12 milestones and overachieving its KPI by 109% in 2019. To the tune of $14.5B in revenues in 2019, a year-over-year growth of 5%.

That is world-class execution relying on Teradata Vantage, for artificial intelligence and machine learning.

stc's answer:

109%
overachievement of its big data and analytics initiative KPI.

stc relies on Teradata to scale highly targeted, personalized marketing campaigns and offers using artificial intelligence and machine learning. The result—top line growth and delivering on its corporate strategy.