Social Network Analysis Helps Telecommunication Firms

Social Network Analysis Helps Telecommunication Firms

Because of the widespread use of free Internet tools and techniques (VoIP, video conferencing tools such as Skype, free phone calls within the United States by Google Voice, etc.), the telecommunication industry is going through a tough time. In order to stay viable and competitive, they need to make the right decisions and utilize their limited resources optimally. One of the key success factors for telecom companies is to maximize their profitability by listening and understanding the needs and wants of the customers, offering communication plans, prices, and features that they want at the prices that they are willing to pay

These market pressures force telecommunication companies to be more innovative. As we all know, “necessity is the mother of invention.” Therefore, many of the most promising use cases for social network analysis (SNA) are coming from the telecommunication companies. Using detailed call records that are already in their databases, they are trying to identify social networks and influencers. In order to identify the social networks, they are asking questions like “Who contacts whom?” “How often?” “How long?” “Both directions?” “On Net, off Net?” They are also trying to answer questions that lead to identification of influencers, such as “Who influenced whom how much on purchases?” “Who influences whom how much on churn?” and “Who will acquire others?” SNA metrics like degree (how many people are directly in a person’s social network), density (how dense is the calling pattern within the calling circle), betweenness (how essential you are to facilitate communication within your calling circle), and centrality (how “important” you are in the social network) are often used to answer these questions.

Here are some of the benefits that can be obtained from SNA:

•Manage customer churn

•Reactive (reduce collateral churn)—Identify subscribers whose loyalty is threatened by churn around them.

•Preventive (reduce influential churn)—

Identify subscribers who, should they churn, would take a few friends with them.

•Improve cross-sell and technology transfer

•Reactive (leverage collateral adoption)—

Identify subscribers whose affinity for products is increased due to adoption around them and stimulate them.

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