A COMMISSIONED STUDY CONDUCTED BY FORRESTER CONSULTING ON BEHALF OF MASTERCARD, JULY 2024 Deciphering The Key Priorities And Challenges Facing Telecom And Media Providers
Executive Summary The telecommunications industry is more critical than ever to global consumers; it brings billions online and enables a plethora of use cases, from streaming to online education to telehealth. Competition is fierce, which has prompted telcos to diversify beyond their core business and find new monetization streams. The telcos that react quickly to consumer needs and innovate will succeed. Telecom leaders are working hard to differentiate their companies through forward-thinking investments and strategies, but many struggle with having the right tools, skill sets, or data to execute effectively. Understanding where common shortcomings exist can help telecom leaders set the right priorities and tactics for their organizations to achieve their business goals. ABOUT FORRESTER CONSULTING Forrester provides independent and objective research-based consulting to help leaders deliver key outcomes. Fueled by our customer-obsessed research, Forrester’s seasoned consultants partner with leaders to execute their specific priorities using a unique engagement model that ensures lasting impact. For more information, visit forrester.com/consulting. © Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester®, Technographics®, Forrester Wave, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. [E-59739] Project Team: Chris Taylor, Market Impact Principal Consultant Contributing Research: Forrester’s Technology Architecture & Delivery research group © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 2 3
NORTH AMERICA (N=62) MIDDLE EAST (N=51) LATIN AMERICA (N=50) EUROPE (N=63) ASIA PACIFIC (N=52) Top Goals By Region Improving customer experience 68% Improving customer experience 65% Improving customer experience 76% Improving customer experience 65% Improving customer experience 67% Investing in cutting-edge technologies 58% Investing in cutting-edge technologies 59% Growing revenue 64% Investing in cutting-edge technologies 59% Growing revenue 54% New customer acquisition 53% Improving management and mitigation of cyber risk/fraud 55% Investing in cutting-edge technologies 52% Growing revenue 52% Improving management and mitigation of cyber risk/fraud 54% Growing revenue 53% Improving data governance and compliance 47% Improving operational efficiency 44% Improving operational efficiency 51% New customer acquisition 44% Improving management and mitigation of cyber risk/fraud 65% New customer acquisition 61% Improving management and mitigation of cyber risk/fraud 72% Improving management and mitigation of cyber risk/fraud 62% Investing in cutting-edge technologies 56% Telecom Leaders Share A Mix Of Tactical And LongTerm Priorities And Goals Telecom leaders are focusing on priorities and goals related to customer experience, new technologies, risk reduction, and business/customer growth. 5 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 4 Base: 278 director-level and above decision-makers involved with setting and/or executing their organization’s B2C digital experience strategy Source: A commissioned study conducted by Forrester Consulting on behalf of Mastercard, February 2024
15% 23% 19% 19% 23% 17% 16% 23% 19% 22% 22% 15% 14% 35% 20% 11% 11% 5% 40% 28% However, Execution Challenges Hinder Their Strong Strategic Visions Less Than Half Of Telco Leaders Feel Well Prepared To Execute On Their Top Priorities STRONG VISION EXECUTION CHALLENGES My company analyzes the relationship among customer loyalty and employee engagement indicators and business outcomes My company needs better business data/insights to guide new investments and improvement My company’s leaders align with the vision for my organization My company needs to improve the way it serves and engages with customers My company has a clear roadmap for delivering on its key business priorities My company provides best-in-class customer experiences 73% 77% 51% 38% 67% 67% Neutral Miminally prepared Moderately prepared Most prepared Least prepared New customer acquisition (N=131) Improving customer experience (N=189) Investing in cutting-edge technologies (N=158) Growing revenue (N=144) Improving management and mitigation of cyber risk/fraud (N=171) LEAST PREPARED TO EXECUTE MOST PREPARED TO EXECUTE 7 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 6 Base: Director-level and above decision-makers involved with setting and/or executing their organization’s B2C digital experience strategy; base sizes vary by priority Source: A commissioned study conducted by Forrester Consulting on behalf of Mastercard, February 2024 Base: 278 director-level and above decision-makers involved with setting and/or executing their organization’s B2C digital experience strategy Note: Showing “Agree” and “Strongly agree” responses Source: A commissioned study conducted by Forrester Consulting on behalf of Mastercard, February 2024
MIDDLE EAST (N=51) LATIN AMERICA (N=50) EUROPE (N=63) ASIA PACIFIC (N=52) Top 3 Delivery Challenges By Region Lack of expertise to execute priorities properly 52% Lack of expertise to execute priorities properly 67% Lack of technical support for key data tasks 74% Lack of expertise to execute priorities properly 65% Security and privacy of customer data 65% Lack of technical support for key data tasks 50% Lack of proper technology to enable the desired results 53% Lack of proper technology to enable the desired results 60% Security and privacy of customer data 51% Lack of technical support for key data tasks 54% Lack of proper technology to enable the desired results 52% Security and privacy of customer data 65% Lack of expertise to execute priorities properly 62% Lack of technical support for key data tasks 62% Lack of expertise to execute priorities properly 63% Shortages In Technical Skills And Data Expertise Fuel Execution Challenges While telcos seem to have abundant technical expertise and resources, the top challenges that leaders selected were the lack of skills, expertise, and support to execute on key priorities and data tasks. Without the right skill sets — those that extend beyond core network operations — efforts to improve the business will fall flat. of telco leaders selected four or more key challenges when given a list of common issues. 94% NORTH AMERICA (N=62) 9 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 8 Base: 278 director-level and above decision-makers involved with setting and/or executing their organization’s B2C digital experience strategy Source: A commissioned study conducted by Forrester Consulting on behalf of Mastercard, February 2024
Execution Challenges Have Immediate And Potentially Long-Term Business Impacts The Business Impact Of Execution Challenges By Region Current challenges with skill sets, data, and technologies have a negative impact on telco organizations. Stifled innovation can also result in lasting damage to customer experience, revenue growth, and customer confidence. Europe (N=63) Latin America (N=50) Asia Pacific (N=52) Middle East (N=51) North America (N=62) LACK OF INNOVATION AND AGILITY 47% 34% 44% 65% 45% DECREASED CUSTOMER EXPERIENCE/ SATISFACTION 40% 34% 25% 21% 27% FALLING BEHIND COMPETITORS 31% 50% 38% 40% 57% COMPLIANCE FAILURES 35% 30% 43% 37% 41% DECREASED EMPLOYEE EXPERIENCE/ SATISFACTION 27% 40% 48% 23% 35% 11 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 10 Base: 278 director-level and above decision-makers involved with setting and/or executing their organization’s B2C digital experience strategy Note: Showing “Current negative impact” responses. Source: A commissioned study conducted by Forrester Consulting on behalf of Mastercard, February 2024
MIDDLE EAST (N=51) LATIN AMERICA (N=50) EUROPE (N=63) ASIA PACIFIC (N=52) Focus on loyalty and personalization 73% Train and upskill employees 75% Train and upskill employees 66% Focus on loyalty and personalization 65% Train and upskill employees 63% Optimize pricing through bundling and use of targeted offers 63% Increase innovation to bring new services and capabilities 67% Focus on loyalty and personalization 58% Increase innovation to bring new services and capabilities 62% Increase innovation to bring new services and capabilities 56% Partner with third-party providers to deliver on priorities 66% Focus on loyalty and personalization 69% Increase innovation to bring new services and capabilities 66% Train and upskill employees 62% Focus on loyalty and personalization 77% Operational Improvement Tactics For Achieving Business Priorities More Effectively NORTH AMERICA (N=62) Base: 278 director-level and above decision-makers involved with setting and/or executing their organization’s B2C digital experience strategy Source: A commissioned study conducted by Forrester Consulting on behalf of Mastercard, February 2024 13 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 12
MIDDLE EAST (N=51) LATIN AMERICA (N=50) EUROPE (N=63) ASIA PACIFIC (N=52) Apply more advanced data analysis techniques 71% Use data insights more frequently to inform decisions 73% Use data insights more frequently to inform decisions 64% Use data insights more frequently to inform decisions 63% Apply more advanced data analysis techniques 90% Improve our ability to identify and address risks from our third-party ecosystem 50% Invest in internal technology and platforms to enhance our offerings 59% Invest in internal technology and platforms to enhance our offerings 62% Invest in internal technology and platforms to enhance our offerings 62% Improve our ability to identify and address risks from our third-party ecosystem 60% Use data insights more frequently to inform decisions 69% Apply more advanced data analysis techniques 69% Apply more advanced data analysis techniques 62% Apply more advanced data analysis techniques 62% Use data insights more frequently to inform decisions 69% Data And Technical Improvement Tactics For Achieving Business Priorities More Effectively NORTH AMERICA (N=62) Base: 278 director-level and above decision-makers involved with setting and/or executing their organization’s B2C digital experience strategy Source: A commissioned study conducted by Forrester Consulting on behalf of Mastercard, February 2024 15 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 14
Telco leaders said they expect to split their investments between in-house and external resources to fill capability gaps and ensure best-in-class service provision. Partnerships And Outsourcing Are Critical Components Of Improvement Strategies Investment Splits Roughly equal mix of in-house and external capabilities Primarily for external third-party product and services providers Primarily for in-house capabilities and resources Tools and technology (N=119) 19% 48% 32% Security/compliance (N=157) 15% 38% 46% Data and insights (N=96) 45% 30% 25% Employee skills/expertise (N=128) 17% 46% 36% 17 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 16 Base: 278 director-level and above decision-makers involved with setting and/or executing their organization’s B2C digital experience strategy Note: Percentages may not total 100 because of rounding. Source: A commissioned study conducted by Forrester Consulting on behalf of Mastercard, February 2024
Conclusion The telecom industry is highly competitive, and business leaders hoping to help their company get ahead must laser-focus on enabling key business priorities via a strong commitment to innovation to drive long-term success. Leaders must start today by addressing the key data, capability, and technology gaps that impede their ability to innovate and adapt. Fostering a more data-driven, agile organization will allow telecom companies to meet rapidly changing customer expectations, adapt to new technologies, and set themselves up for future growth and success. Methodology This Opportunity Snapshot was commissioned by Mastercard. To create this profile, Forrester Consulting conducted a custom survey of 278 director-level and above decision-makers at telecom companies who are involved with setting and/or executing their organization’s B2C digital experience strategy. The custom survey began and was completed in February 2024. Note: Percentages may not total 100 due to rounding. ROLE C-level executive 10% Vice president 41% Director 50% ANNUAL REVENUE More than $5B 31% $1B to $5B 36% $500M to $999M 33% REGION Asia Pacific 18% Europe 23% Latin America 18% Middle East 18% North America 22% TELECOM TYPE Telecom operator (MNO, MVNO) 40% Broadcast 23% Cable media 20% Broadband 17% Demographics 19 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 18
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