Awards case study: How Vodafone turned the shock of expensive bills into a positive experience

Learn how Vodafone used the negative experience its customers faced to encourage customer loyalty and reduce churn

Summary

Bill shock is one of the biggest pain points in the telco industry. Customers who receive high bills churn twice as much as other customers.

Beside financial implications, it’s the confusion about charges and the time-consuming task of going through a 30-page bill that weakens the relationship with the brand, leaving customers with emotional stress and unclear on the actions to be taken for the future.

For this reason, Vodafone embarked on the challenge of transforming a de facto negative experience into a positive and seamless customer journey. It aimed to do this by empowering customers with immediacy of information and decision-making by telling the key story behind their high bill (i.e. which employee incurred the charges and why). It also wanted to provide prompt solutions across both digital and non-digital channels, such as app, online or dedicated phone number.

The campaign used highly-tailored messaging to leverage the benefits of one-to-one, while maintaining the volume benefits of a centralised SMS deployment.

As a result, the campaign reduced churn by 12% in the two-months post-campaign. This also meant reducing involuntary churn from businesses who would go into collections because of repeated high charges.

About

Vodafone UK is a provider of telecommunications services in the UK. Vodafone’s Soho department — part of Vodafone Enterprise — provides mobile and fixed connectivity products and services to small companies of up to nine employees.

Strategy

Strategies for the campaign included reduction of churn, improvement in customer experience, and becoming a digital telco across customer touch points.

Bill shock is one of the biggest reasons for churn. Vodafone define a bill shock customer as any business with a mobile product on the account that incurred an ‘out of bundle’ usage (i.e. not included in the mobile plan) in any given month that is at least three times higher the basic plan charge. 

Pre-campaign analysis showed that 12% of customers churn within two months from receiving a bill shock. Furthermore, the greater the bill shock, the higher the churn rate, ranging from 9.4% for customers incurring a bill that is three times their tariff spend, to 13.8% for customers with a 10 times multiple. Overall, 38.9% of bill shock customers receive more than one bill shock, a clear indication for a campaign opportunity.

Solutions presented in the bill shock campaign include specific product benefits (e.g. international minutes, roaming) to remove the risk of astronomic bills.

The bill shock campaign drives digital by directing customers to the website with details of proposed solutions and invites them on other digital self-service channels like the My Vodafone app.

Objectives of the campaign

Bill shock events for business customers are harder to tackle than their consumer counterparts. Imagine you’re a business of nine employees, who all have a tablet and phone plan on the account. You receive your monthly bill and it’s double the amount it should be. You have no idea why, so you’ll need to check the itemised usage across all products for all your employees. After hours of doing this you’ll need to call Vodafone’s care team to try understand why this happened and what can be done to avoid this in the future. This surely will reduce your productivity and the time you dedicate to running your business.

Conversely, what if you received a message from Vodafone directly explaining what the product/number that incurred the charge is and why, and what actions you can take to prevent this from happening again?

The campaign objective was to identify the exact behaviours triggering bill shock, match them to each user case and transform actionable customer journeys for an immediate resolution. To the customers, this means receiving a personalised call to action in a one-to-one communication style. To the business, it means reducing churn and improving customer satisfaction.

The target audience

The target audience were decision-makers who have incurred a bill that is three times higher than their tariff plan. Due to size, these businesses are not account-managed so are very sensitive to a one-to-one communication approach. As most accounts have multiple mobile lines on the account they may or may not be the ones responsible for the usage charge. However, either way they have decision rights on the account and will likely be directly impacted by the high bill.

Media, channels or techniques used

The campaign media is made up of seven SMS variants, each with a dedicated landing page tailored to the bill shock cause and with the relative call-to-action to resolve the specific issue. In these pages, customers are then presented with a choice of channels like the My Vodafone app, website, or SMS text. Customers can also call a dedicated call centre team — even while abroad — to speak to an advisor directly, given the delicate nature of the issue.

Timescales of the campaign

Q3: Analysis of customer overage took place.

Q4: Campaign design and planning with test sends.

March - April: Campaign fully launched and continues to run at the end of each month to coincide with billing period.

May: Analysis done.

Budgets

Agency fee or external marketing spend: £0

Creative development and campaign media set up: Internal resources

Results

  • 12% reduction in churn and +7% reduction vs the set target. Performance review revealed that no customers who received treatment have churned.
  • 30% (+20% vs set target) of targeted base enabled product features.

This campaign managed to reduce churn thanks to tailored service information, allowing customers to promptly take actions on their account to safeguard themselves against further overage. Thanks to the clarity of the message, this also reduced the time to handle customer queries, while action was immediately in digital channels. This is a clear example of the value that a one-to-one marketing approach can bring to improve customer experience.

Cameron Fraser, head of customer value management, Vodafone UK.

This submission won the award for 'Best customer experience (CX) initiative' at the International B2B Marketing Awards 2018 . 'Taking your shock away with a personal touch' for Vodafone UK.

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