Latin America is the fastest-growing region in the world in terms of Internet expansion. The region's audience grew 23 percent in the past year and now represents 8 percent of the global Internet audience, according to ComScore (June 2010). Social Networking is the most popular category in Latin America after Search. At a business level, some companies in the region (such as Iusacell, Telcel, BestBuy México or Dell) have been using Twitter as a communications tool and to advertise promotions.
Are Communications Service Providers (CSPs) taking full advantage of the social media explosion in this emerging market? Monica Zlotogorski, Vice Chair Latin American Advisory Board, and Editor Inside Latin America, TM Forum, discussed the topic with Martin Creaner, President, TM Forum,Josh Goldfein, Online Communities and Blogs Manager, TM Forum, Ariel Barlaro, CEO, NexTV Latam, Claudio Schapsis, Strategic Advisor for Location Based Services, BDNooZ, and Claudia Goffan, CEO, Target Latino and recognized expert in Latino Marketing by CNN en Español.
Monica Zlotogorski: Josh, you live in Argentina. How would you describe the current use of social media by telco and cable companies in Latin America right now?
Josh Goldfein: From my perspective, Latin American telco and cable companies are only just now beginning to understand the power of social media. Much of their social media activities to date have been marketing promotions meant to increase new subscribers or brand awareness. For example, Fibertel is operating under the "any attention is good attention" social media philosophy, like their Dia del Amigo (Friend's Day) promotion on Facebook. Fibertel created a Facebook application which is intended to fool people's friends into thinking their Facebook account has been hacked. The wisdom of an ISP running a fake hacking promotion is up for debate.
Ariel Barlaro: Cable TV companies in Latin America first dived into social networking as a way to discover piracy and fraud, as many forums specialize in sharing information about how to pirate cable and satellite access systems. Many of these forums, and other new ones, have begun to share information about quality of experience of different operators: signals that some have and others do not, cuts in service, common problems and solutions. In many cases, involvement by operators' employees is detected in these forums. Especially in the most recognized forums. For example, the forum "Laneros" about a regional DTH operator has taken such a narrow focus that the company must have a specific interest to follow it.
MZ: Ariel, you also see CSPs in the region using social networks 'just' as extensions of marketing and promotional campaigns, rather than being used for other purposes, like billing and customer care?
AB: The strategies in new social networks like Facebook or Twitter first come by the hand of marketing rather than customer care. For example, before the World Cup, a group of Facebook users launched a campaign to collect 100,000 signatures for Movistar TV from Venezuela to transmit the World Cup in HD. Movistar is now offering HD plans for such users. These types of "outcry" campaigns using social networks are popular in interactive marketing, and it is likely that they'll be generated to both bring new products (to the market) as well as attract users from the competition. To the extent that they become popular, genuine initiatives will also surge on social networks, and customer care executives will have to follow them carefully.
JG: Telecom companies in Argentina have only recently started enabling customers to pay their bills remotely. Until just a few years ago, paying bills required sacrificing an afternoon standing in multiple queues at rapipago kiosks or banks. Allowing customers to pay from the comfort of their home via online or direct billing was a well received and much needed sea change. This same evolution in thinking needs to occur in telco customer care. Customers are still expected to navigate multiple lines, waiting areas and draconian internal policies in order to resolve billing disputes, receive technical help or even purchase new products. This has created a disturbingly adversarial atmosphere between client and provider.
MZ: How can you change this dynamic?
JG: The key to changing this dynamic could be through the use of social media networks. Movistar's Facebook page provides the framework for how these new tools can be used to connect with clients and not only resolve customer care issues, but restore a company's relationship with the customer. Movistar welcomes customer input, billing questions and technical problems through its Facebook page and responds to all queries quickly and publicly. It's easy to see that transparently interfacing with their clients on a platform where they feel at home has created a positive feedback loop amongst the users.
MZ: Do Latin American customers voice their opinions about their customer experience online? If so, how can CSPs in the region use this data to their advantage?
Claudia Goffan: Yes, we have noticed on our monitoring of the telecom industry in Latin America that people voice their opinion online freely regarding their equipment, customer service issues, plan recommendations, preferred carriers, level of service and the like. Telecom companies could develop a very strong strategic differential by monitoring the Consumer Generated Media (CGM) and responding to it in a timely fashion. Just imagine you are either a user with a problem with your equipment or reception and you post a comment on a forum or a social media network, and the customer care online representative from the telecom company responds to your inquiry by offering to assist you. How would that make you feel? Customer experience is key to the continuous acquisition and retention of customers.
Martin Creaner: Social networks are the main way a significant proportion of the customer base chose to interact - email is dead for these people! So a key focus for telcos is how to make it easy for their customer base to use their chosen social network whether it be Facebook, Twitter or Linked In. Integrated easy access from mobile devices is also critical – (outside Latin America) Vodafone 360 is a good example of a telco strategy in this area.One of the key recommendations in the TM Forum Customer Experience research report was for telcos and MSOs to be flexible about how they interact and take feedback from their customers. Allowing customers to interact via Facebook and Twitter is just as important as allowing them to interact via email and paper mail.
MZ: We talked about marketing, promotions and customer care. But how can CSPs generate revenue through the use of social media?
CG: We know that the cost of voice communication in Latam is prohibitive and, for a while, texting has been the main means of communication between people. Social media via handsets has captured a great part of that role. Telecom companies should be looking into adding further smartphone options at more affordable prices by either developing new handsets or subsidizing its cost. This is just one of the numerous strategies that could be implemented based on the analysis of online monitoring results.
MZ: One of the most significant trends in social media is the flourishing of applications that provide location user data. How do you make money from this type of service?
Claudio Schapsis: Location Based Services (LBS) add relevance to the message that is sent by increasing the relevance you increase the effectiveness, and the more effective the message, the faster the return on the investment is achieved. For example, an advertising campaign aimed at capturing the public for a network of restaurants during lunch time, will have greater success if users who receive the promotion are in a radius that's near these establishments. This proximity marketing allows providers to focus resources on the customers with the greatest potential.
MZ: Why is location data so important?
CS: Because LBS is the missing link that connects virtual forums with the real world. In general, the user of social networks is seen as the target of the marketing efforts, when in fact the companies that collect the location data of their customers can obtain greater benefits by commercializing to third parties. Human beings tend to repeat their behavior, and this extends to the places they visit, times, frequency, company, etc. There are companies that can create the "geographic DNA" of a person. If this is expanded to certain groups with specific profiles, we can estimate the "geographic behavior." That is, for example, that social networks can sell to the restaurants information such as what time and where the "executives, between 25 and 45, that have lunch in groups of 3 +" will be by providing strategic information for the location of new premises, outdoor advertising, distribution of ads, etc. It's no coincidence that Facebook clearly mentioned in its privacy policies that it reserves the right to collect location data of all its customers - no questions asked.
MZ: Thank you.
By Monica Zlotogorski, Vice Chair Latin American Advisory Board, and Editor Inside Latin America, TM Forum