Moving Upstream to Increase Customer Retention 

Moving Upstream to Increase Customer Retention 

Bradley MayBy Bradley MayIndustry Principal - Communications, Media & TechnologyUniphore
9 min read

Telecommunications companies are in a tough spot. Driving top line growth remains a top priority, yet the high cost and significant effort it requires to attract new customers—coupled with rising customer churn rates—is making it harder to achieve that goal. As a result, the telecommunications industry is putting more emphasis on growth and retention strategies designed to maximize the lifetime value (LTV) of existing customers. While this doesn’t mean that customer acquisition is going away anytime soon, it does indicate a reprioritization based on what’s most profitable. And with an ever-widening array of plans, products and services, it’s simply more profitable to upsell and cross-sell to current subscribers than to target new users.

In fact, studies have found that bringing in a new customer can be between five and 25 times more expensive than growing an existing one. What’s more, existing customers often spend more with a company than new customers. These facts aren’t lost on telecom business leaders. Speaking at the BofA Securities 2022 Media, Communications & Entertainment Conference Pascal Desroches, Senior Executive VP & CFO AT&T, shared, “We didn’t put all of our promotional dollars towards new customers. We instead said, let’s focus on retaining our customers that we know a lot about. The cost of retaining them is less than trying to go out and acquire new customers. It is growing both top line and bottom line.”

However, reprioritizing customer retention isn’t as simple as ramping up promos and marketing campaigns. To be successful, service providers need to focus in two areas: 1) improving customer experience (CX) to increase loyalty and, ultimately, customer lifetime value, and 2) creating “stickiness” through proactive and effective upselling and cross-selling (also known as upstream retention). Either task would be monumental at the scale required by most telecom companies. Fortunately, they are getting some serious help from technology in the form of conversational AI and automation.

A man on a cell phone chatting with someone on a laptop.

The Case for Growing an Existing Base Vs. New Acquisition 

It’s no secret that onboarding new customers is costly. It demands significant amounts of time and money on promotional activity, like advertising, marketing, partnerships, reviews, social media and lead development. And the ROI of all that effort is far from guaranteed. By contrast, existing customers already have an established relationship with a brand. They also have something far more valuable: volumes of historical data. That data can be leveraged to identify LTV-maximizing opportunities, such as upgrading accounts to premium plans (upselling) or adding additional services (cross-selling).

Just how can telecom companies leverage this data to drive top line revenue and improve profitability? With conversational AI and insights. By analyzing interaction trends and behaviors, conversational AI can pinpoint upsell/cross-sell opportunities and proactively engage customers where and when they are most likely to convert. Perhaps a customer on a legacy plan isn’t familiar with the most current options. Or maybe they could benefit from a device upgrade or by bundling multiple services. Conversational AI and insights can detect these indicators and more and suggest—and even automate—the appropriate action(s).

This includes during live customer service interactions. A conversational AI-enabled agent assist program, like U-Assist, can help agents be more effective with upsell and cross-sell motions by getting them to not just make offers more often, but know when and how to make the offer—ultimately resulting in more conversions.

Improving CX to Increase Loyalty and Customer Lifetime Value

According to Accenture, customer experience has become the single biggest factor driving customer loyalty and revenue growth in the telecom industry. Customers now have more choices than ever and, as a result, are increasingly willing to take their services elsewhere if a company doesn’t meet their needs. For instance, 37% of customers won’t buy services from companies that don’t offer personalized experiences, according to Redpoint Group research.

Furthermore, Emplifi research with UK and US consumers found that 86% of people would leave a brand they had been loyal to after just two or three bad experiences with customer service. While minimizing turnover is one incentive for improving CX, it’s certainly not the only motivating factor. In its latest State of the Connected Customer, Salesforce shared some of the more positive effects of better CX on customer trust and loyalty, including:, including:

0 %

of customers said that a positive experience would make them more likely to purchase again

0 %

reported recommending a company based on excellent customer service

0 %

would forgive a company for a mistake after receiving excellent customer service

0 %

have made purchase decisions based on the quality of customer service

What makes for good CX? You’ll get different answers depending on who you ask. But it really is the brilliant basics. Things like reduced customer effort, easier access to self-help, less time on hold, first contact resolution, shorter calls, fewer transfers, and more promises kept—the list goes on.

According to PWC data, 63% of U.S. consumers will share more personal information with businesses that offer great experiences, and 80% identify convenience, friendly service, knowledgeable help and speed as the most critical elements of customer experience.

In its recent report, Money on the Table: Proof That Customer Service Drives Revenue, Forrester elaborated on the impact CX has on a customer’s willingness to spend money with a company. The following three CX drivers are highlighted as extremely influential:

CX drives loyalty. Loyalty feeds customer lifetime value. And conversational AI and insights can play a major with each of these CX drivers.

Driving Upstream Retention through Upselling and Cross-Selling 

Let’s assume you have made great progress on winning the hearts and minds of your customers through incredible customer service. You’ve earned the right to do more business with your customers. However, that’s not an open invitation to bombard them with cookie-cutter promos or bully them into upgrading services.

Successful upselling and cross-selling require a strategic touch. And with the data gleaned through conversational AI, you have an opportunity to provide more value to your customers by matching them with the best-fitting products at the right price points. This approach boosts customer loyalty and “stickiness” (i.e., how indispensable you are to a customer), improving the chances of maintaining long and profitable relationships.

That said, a few key trends affect this ability to upsell and cross-sell in the cable and telecom space:

By tailoring upselling and cross-selling tactics around these trends, telecom providers can increase their ARPU/ARPA exponentially. Combine that higher ARPU with increased loyalty, and you have a winning combination. Furthermore, when you factor in a much lower cost to serve (compared to acquiring new customers, who typically spend less than existing customers), the math really adds up.

Potential “Click-to-Cancel” Challenge

Customer retention tactics could become even more crucial for telecom firms in light of the Federal Trade Commission’s proposed “click-to-cancel” rule. The rule aims to make it as easy as possible for consumers to cancel services and unwanted subscription payment plans. It would also prevent companies from requiring consumers to call a customer service line to cancel a service or account they signed up for on a website.

How Conversational AI Can Boost Upstream Retention

We’ve touched on how conversational AI tools help call agents become more effective in upselling, cross-selling and increasing conversions by making offers at the right time. Now, let’s get down to the nuts and bolts of how conversational AI can boost upstream retention.  

Knowledgeable, Personalized Customer Service

Based on a customer’s issue, conversational AI can either resolve it via intelligent self-service or direct the customer to the appropriate agent (along with all contextual information provided thus far in their journey). In both channels, AI can use past interaction data and predictive trends to create a highly personalized experience (a major customer loyalty driver). It can also simplify searching for information—a common CX hurdle—significantly with knowledge AI that surfaces relevant information where and when it’s needed most. This not only reduces customer (and agent) frustration, but also expedites call resolution, creating a better customer experience that’s memorable for the right reasons. 

Actionable Insights

Combining conversational insights with transactional data from systems of engagement, AI can identify ideal customers for upselling and/or cross-selling. These insights can be used to generate highly targeted outreach initiatives and even guide customer service reps during the call on the best strategy for approaching and closing sales deals (more on that below). On the backend, conversational AI can analyze rep performance to pinpoint what works and what areas could benefit from additional training and/or coaching.  

Insight-Driven Guidance

Conversational AI can analyze every customer conversation to understand intent, sentiment and even emotion—all in real-time. It can also identify friction points in customer experience as well as potential sales opportunities. By sharing these contextual insights with customer service reps, it can guide them to the next-best actions based on their probability of success. For example, if a customer is frustrated with a service limitation, AI can identify a better fit and even “coach” reps on the best way to sell the upgrade. It can also propose responses to common objections, such as need, price and competition. 

How Uniphore Can Help

Uniphore technology helps telecom firms address their challenges by delivering conversational AI and automation for the enterprise. We help businesses to automate conversations and find actionable value in every interaction with every customer. This includes smart conversational AI through patented, enterprise-grade Robotic Process Automation (RPA), intelligent decision support, self-serving guidance and voiceprint biometrics.

These solutions are designed to drive more value out of every enterprise conversation. Our three U products enable companies to facilitate upselling and cross-selling, with benefits including:

Conversational insights: It’s increasingly crucial for businesses to identify the customers best suited to upsell and cross-sell. U-Analyze provides insights into conversations to show agents why customers do or don’t buy specific products and services. The technology also monitors agent performance and isolates conversational behaviors, such as empathy and objection handling, to identify opportunities to drive additional revenue. 

Real-time agent assistance: When contact center agents have customers on the line, it’s vital to guide them towards the most appropriate products and services or solve their issue as quickly as possible. U-Assist uses existing customer insights to successfully guide agents to complete upsell and cross-sell opportunities. It can also recommend upsell and cross-sell offers to agents in real-time based on the flow and tone of the conversation, then capture agent and customer promises for follow-up. 

Personalized customer experiences: Customers increasingly expect companies to deliver highly personalized and intuitive digital experiences. U-Self Serve enables customers to explore upgrades and new products, then helps them to buy online or connect to an agent. This multi-modal shopping experience gives customers multiple choices and drives quicker setup, then assists with further questions around billing. 

Want to learn more?

Discover all the ways Uniphore is helping telecom leaders deliver better CX, and see how our conversational automation solutions can drive higher customer loyalty, lifetime value and profitability for you.

Learn more

Table of Contents