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The Connected Consumer Survey 2013: Fixed Broadband Retention and Upsell

  • Published:
  • PPT and PDF (60 slides); Excel
  • Analysys Mason

Abstract

The survey results lead us to believe that operators' most-effective strategy for customer retention does not actually require them to focus on highly dissatisfied customers.

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This report focuses on aspects of Analysys Mason's annual Connected Consumer Survey that relate to the behaviour, preference and future plans of fixed broadband users in France, Germany, Poland, Spain, the UK and the USA. The survey, consisting of an online questionnaire of 137 questions, was conducted in October 2012 and had a total sample size of 6610 respondents, which was designed to be representative of the online population with respect to age, gender and employment status.


This report provides:

  • detailed analysis of the drivers of churn
  • analysis of consumers' real-world reasons for changing provider
  • understanding of fixed broadband customers' future priorities and how this can attract competitors' customers
  • an explanation of the role that superfast broadband can play in both retention and revenue generation
  • qualitative information about the impact that bundling has on customer retention
  • discussion of real-world strategies put in place by companies such as BT, Iliad, Orange and Virgin Media, with associated survey results
  • penetration information for over-the-top (OTT) services and companies such as Deezer, LOVEFiLM, Netflix and Spotify.

Survey data coverage

The survey group consisted of 6610 individuals aged 18 years and over, and was representative of the demographic characteristics of Internet users in each country - France, Germany, Poland, Spain, the UK and the USA. Respondents were selected until nationally representative quotas for gender, age range and employment status (as well as geographical region in the case of the USA) were reached. Respondents were then asked to complete a 20-minute questionnaire, Analysys Mason's Connected Consumer Survey. Questions took the form of yes/no, multiple choice, text and numerical input cells.

Geographical coverage

  • France
  • Germany
  • Spain
  • Poland
  • UK
  • USA.

Table of Contents

  • 5.Executive summary
  • 6.About this report
  • 7.65-80% of respondents who threaten to change their service provider then follow through
  • 8.Revenue growth strategies must focus on promoting 'value for money' -this can be achieved with higher speeds and bundle calibration
  • 9.Respondents with quadruple-plays were half as likely to intend to churn as those who took fixed broadband on its own or only with a TV service
  • 10.Consumers who watch premium online video content have faster fixed broadband than non-watchers, suggesting ISPs have an upsell opportunity
  • 11.Implications and recommendations
  • 12.Implications and recommendations [1]
  • 13.Implications and recommendations [2]
  • 14.Implications and recommendations [3]
  • 15.Fixed broadband speeds, usage allowances and technologies
  • 16.Operators will find it difficult to educate some consumers about access technologies, or even basic service information - price rules everything
  • 17.One potential approach for 'handling' customer confusion - the home CPE could influence consumers' perceptions of service speeds
  • 18.The UK has a higher penetration of usage-capped fixed broadband services than other survey countries - the trend is still towards unlimited
  • 19.Understanding and influencing fixed broadband customer retention
  • 20.Disruptive tariffs have increased churn rates in France and Spain
  • 21.Increasing customers' satisfaction scores by one or two points could halve their churn risk
  • 22.Qualitative interpretation: bundling, NGA and a strong TV proposition drive customer retention
  • 23.Quantitative interpretation: customer service and network reliability affect overall satisfaction more significantly than speed and price
  • 24.The greatest difference in churn intention appears to be the difference between a consumer rating their provider as 2 out of 5 versus 3 out of 5
  • 25.Retention strategies should be directed towards home owners (not renters), families and younger consumers
  • 26.A failure in operators' ability to engender a sense of 'value for money' is one of the main drivers of fixed broadband churn
  • 27.Fixed broadband churn rates appear lower than those of mobile services and intention to churn peaks within the first year of subscription
  • 28.Respondents with quadruple-plays were half as likely to intend to churn as those who took fixed broadband on its own or only with a TV service
  • 29.Customers with high-speed services are less likely to plan to change service provider: speed upgrades could increase customers by +3% p.a.
  • 30.Driving revenue growth by upselling and attracting new customers
  • 31.Stimulating revenue growth by upselling and attracting new customers: after price, speed and reliability most influence the buying decision
  • 32.Superfast broadband users are typically in family homes - younger couples and residents of larger shared households are also interested
  • 33.The superfast broadband price premium appears to be less important to take-up than absolute price, availability and how the services are bundled
  • 34.Operators can use 'reliability' as a selling point for attracting customers, but what 'reliability' exactly means is debatable
  • 35.Bundling demographics remain stable which suggests further multi-play subscriber growth potential; operators will trade revenue against retention
  • 36.Iliad has the highest customer satisfaction score for price - its approach can be summarised in two steps
  • 37.Using over-the-top services and devices to operators' advantage
  • 38.Operators can use services such as streaming music, online video and gaming to their own advantage in both direct and indirect ways
  • 39.Netflix and LOVEFiLM have stimulated the consumption of paid-for online video services in the UK and USA ahead of other countries in our survey
  • 40.Consumers who watch premium online video content have faster fixed broadband than non-watchers, suggesting ISPs have an upsell opportunity
  • 41.The large installed base of games consoles is currently the most effective platform for delivering online video services
  • 42.Operators can tailor their broadband services to better serve the high penetration of console-owning and gaming consumers
  • 43.Cloud gaming providers have had set-backs, but consumer take-up of services is promising
  • 44.19% of respondents used streaming music services - companies such as Deezer and Spotify are looking healthier than previously
  • 45.People who listen to streaming music are more likely to churn - therefore, our results do not strongly reflect the positive effect of bundling these services
  • 46.Panel information and methodology
  • 47.Methodology
  • 48.Panel information: UK
  • 49.Panel information: France
  • 50.Panel information: Germany
  • 51.Panel information: Spain
  • 52.Panel information: Poland
  • 53.Panel information: USA
  • 54.About the author and Analysys Mason
  • 55.About the author
  • 56.About Analysys Mason
  • 57.Research from Analysys Mason
  • 58.Consulting from Analysys Mason

List of figures

  • Figure 1: Countries covered individually in this report
  • Figure 2: Fixed broadband respondents who want to change service provider within 6 months, by country, 2010-2012
  • Figure 3: High-priority factors when considering next fixed broadband service, by country
  • Figure 4: Future (6-month) plans for fixed broadband, by combination of services bought from the same provider
  • Figure 5: Market share of OTT video service providers, by country
  • Figure 6: Average distribution of fixed broadband access technologies based on operator-derived reporting and respondents
  • Figure 7: Distribution of respondents by claimed and actual fixed broadband access technology
  • Figure 8: Distribution of fixed broadband downstream bandwidths, by access technology
  • Figure 9: Distribution of fixed broadband usage allowances, by country
  • Figure 10: Fixed broadband respondents who want to change service provider within 6 months, by country, 2010-2012
  • Figure 11: Intention to change service provider within the next 6 months, by satisfaction level, Europe
  • Figure 12: Overall satisfaction of fixed broadband customers who subscribe to selected operators, by absolute score, index and rank
  • Figure 13: Linear regression model for the overall satisfaction of respondents against their satisfaction with specific aspects of the service on a scale of 1 to 5
  • Figure 14: Average overall customer satisfaction score (on a scale of 1 to 5) for different customer service and reliability scores
  • Figure 15: Distribution of respondents who plan to change service provider, by overall satisfaction scores
  • Figure 16: Intention to change fixed broadband service provider, by age and household situation
  • Figure 17: Future (6-month) plans for fixed broadband, by type of living arrangement
  • Figure 18: Reasons given by fixed broadband respondents for wishing to churn within the next 6 months, by country
  • Figure 19: Six-month plans for fixed broadband, mobile broadband and mobile voice service, by time with service provider
  • Figure 20: Future (6-month) plans for fixed broadband, by combination of services bought from the same provider
  • Figure 21: Intention to change fixed broadband service provider, by downstream broadband speed and country
  • Figure 22: High-priority factors when considering next fixed broadband service, by country
  • Figure 23: Distribution of respondents who subscribe to fixed broadband services with download speeds of more than 30Mbps, by age and household situation
  • Figure 24: Distribution of respondents who plan to change tariff in the next 6 months and cite higher speeds as their first priority, by age and household situation
  • Figure 25: Price premium, take-up and satisfaction scores for different bandwidths, by country
  • Figure 26: BT Retail fixed broadband market share, by access technology, 2008-2012
  • Figure 27: Main priority when looking for a new fixed broadband provider
  • Figure 28: Distribution of respondents who take at least triple-play services from their fixed broadband service provider, by age and household situation
  • Figure 29: Average satisfaction score for the price of fixed broadband services, selected operators
  • Figure 30: Fixed broadband net line additions by operator, France, 3Q 2011-2Q 2012
  • Figure 31: Take-up of free and paid-for online video services, by country
  • Figure 32: Market share of OTT video service providers, by country
  • Figure 33: Fixed broadband speed distribution, by whether respondents are users of paid-for online video services
  • Figure 34: Devices that enhance the capability of a basic TV set
  • Figure 35: Ownership of consoles, by type
  • Figure 36: Take-up of cloud gaming services, by country
  • Figure 37: Penetration of cloud gaming, by age and gender
  • Figure 38: Take-up of free and paid-for streaming music services, by country
  • Figure 39: Market share of streaming music services, by country
  • Figure 40: Take-up of streaming music services among the customers of fixed broadband service providers that have a partnership with a music service provider
  • Figure 41: Survey respondents' demographic data: UK, 2012
  • Figure 42: Survey respondents' demographic data: France, 2012
  • Figure 43: Survey respondents' demographic data: Germany, 2012
  • Figure 44: Survey respondents' demographic data: Spain, 2012
  • Figure 45: Survey respondents' demographic data: Poland, 2012
  • Figure 46: Survey respondents' demographic data: USA, 2012
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