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Global Telecom Consumer Survey 2011
IBM Survey Reveals that Communication Service Providers Face Growing Customer
Loyalty Gap
Proliferation of Technology in Growth Markets bring new customer opportunities
Mobile World Congress, Barcelona – 29 February, 2012 – According to IBM (NYSE: IBM), the global climate
for today’s communications service providers (or CSPs) is fueled by informed, connected and demanding
consumers, many of whom are growing less loyal as their expectations rise and as they take advantage of
new channels for information. Also revealed in the survey is a consumer attitude of "love my phone, hate
the service" that has proven pervasive worldwide.
IBM unveiled these findings in the “IBM Global Telecommunications Consumer Survey” polling more than
13,000 consumers in 24 countries to assess general attitudes, including consumers’ spending priorities,
grievances, information sources for products and services, and overall purchasing values.
The results shed light on a budget-conscious, demanding consumer spending an increasing amount of time
online, more apt to interface with their friends and family over social networking sites about their services
rather than communicate directly with the provider. The survey also paints of picture of a sudden rise in
mobile and Internet use in growth markets, indicating new opportunities for providers to target an
increasingly sophisticated and desirable customer. While these customers are loyal to many brands in their
daily lives, there indeed remains a chasm – and opportunity – for them to become better to connected to
their service provider.
“There is a gap in the marketplace in how consumers perceive their provider vs. how they perceive and
value, for example, their actual device,“ said Bob Fox, Telecommunications Industry Leader in IBM’s Global
Business Services. “The industry is facing a critical time period where reaching the consumer and
understanding how they communicate has become paramount. Future success will belong to the CSPs that
can amass more loyal customer, lower churn rates and acquisition and service costs matched to the value
of the customer. To gain competitive advantages, CSPs must deepen their consumer insights, encourage
interactions and create an emotional connection to their customers like we see in other industries.”
A New, Global Consumer: The survey revealed that many emerging markets appear to be bouncing back
more quickly from the 2008 economic downturn than mature markets, with a higher level of overall
consumer confidence and purchasing intent, highlighted by spending on communications services.
Consumer sentiment on future spending on mobile telecommunications in emerging markets exceeds
mature markets by 35%.
This growth for emerging market communications providers is likely to continue in the next few years, with
consumer demand, economic power and innovation shifting to rapidly developing markets such as China,
IBM
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Global Telecom Consumer Survey 2011
India and Brazil. Part of this is due to the sheer volume of emerging market consumers in these areas: with
an approximate population of 5.7 billion in 2010, emerging countries have almost five times more
consumers than mature markets, where the population is approximately 1.2 billion. Today, mobile
subscribers in emerging markets outnumber fixed ones by more than five to one – signs pointing to
significant potential growth areas for CSPs.
The consumer in emerging markets is also interacting online at higher rates than previously assumed, as
social networking has become a leading communication channel. For example, 60% of emerging market
consumers with a fixed or mobile Internet connection access social networks daily, versus 45% in mature
markets. At the same time, mobile growth continues to outpace fixed line, including broadband, signifying
a growing impact on the overall network in emerging markets.
According to IBM, they also appear more discerning about their choices. Many of these consumers might
switch to cheaper alternatives such as mobile VoIP, instant messaging and social networks versus
continuing with a traditional provider.
Have Problems, Won’t Call: While consumers’ perception on network services is relatively poor, IBM
discovered most consumers do not engage with their provider on these issues. Globally, 54% do not
complain to their provider when being disconnected from the network during a voice call or Internet
session. In the United States, a staggering 71% of unhappy customers do not complain. Though in such
instances consumers might not be connecting with their providers, they are definitely connecting with
other consumers. For example, when disconnected, more than three fourths of consumers surveyed are
likely to tell friends and family about the experience and/or avoid providers associated with poor
experiences.
As key reasons for not complaining, consumers said that it is too much hassle to get through to the call
center (overall 45%) or that complaining will not make any difference (44%). The third reason consumers
gave (29%) is the fact that they have to wait too long to reach someone in the call center. In emerging
countries, 30% of consumers shared they believe networks are unreliable and that they always expect to
service to vary.
Telling family and friends about poor experiences: Globally, 77% of consumers surveyed tell friends about
poor experiences with their provider, with the highest rate of sharing displeasure verbally is in China (93%).
81% of all respondents said to avoid providers with whom their family and friends had a poor experience,
with highest rate for Sweden (94%).
Is there a way out?: Yes. CSPs need to find a way to shift resources from traditional channels - retail stores,
advertising, promotions, own web sites - to the powerful emerging channels of social media sites,
comparison shopping sites, and towards influencers in their user communities. CSPs must find ways to
understand consumers as individuals and part of communities, and encourage - not just tolerate -
interaction with them across multiple channels, identify emotional connections to their brands and
products, and create seamless positive experiences across digital, human and physical channels.
IBM
© Copyright IBM Corp. All rights reserved. Page 2 of 3

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Global Telecom Consumer Survey 2011
About the IBM Institute for Business Value: The IBM Institute for Business Value has a worldwide presence
and is comprised of more than 50 consultants who conduct research and analysis across multiple industries
and functional disciplines.
To learn more on the consumer survey, contact:
Rob van den Dam
Global Telecommunications Leader IBM Institute for Business Value
Phone number: 31 6 51284594
E-mail: rob_vandendam@nl.ibm.com
IBM
Copyright IBM Corp. All rights reserved.