The ability to better understand—and potentially alter—the customer experience is driving about two-thirds of Big Data initiatives in the telecommunications industry. The digital connections made possible by companies like Twitter and Facebook enable telecom customers to be more vocal about their expectations and desired outcomes; CSPs that integrate these social media-driven insights with transactional data can produce much clearer pictures of both satisfied and frustrated customers. And with competition from over-the-top (OTT) players like Google and Skype intensifying, established CSPs are eager to leverage the one clear advantage they have over those outliers: easy access to years of customer data.

Of course, sophisticated techniques like the predictive-analytics solution employed by XO Communications require an all-in investment that not every CSP is ready to make yet. In fact, a number of barriers to entry are preventing, or at least delaying, a full-fledged embrace of Big Data initiatives.

According to the findings of IBM’s Big Data @ Work Study, only 33 percent of CSPs have Big Data projects in pilot programs or in production, while the other two-thirds are in the planning and discussion stages (54 percent) or are still weighing their options (13 percent). To date, the CSPs that are using Big Data are the ones that have strong analytics capabilities already in place and have been able to tap into easy-to-access sources of internal data, such as transactions, log data, social media, and call-center records.

Those companies are seeing results that prove, and even further, their original business case: 85 percent of the CSPs that participated in the 2012 Big Data @ Work Study indicated that Big Data and analytics were helping to give their organizations a competitive advantage. That’s an increase of 124 percent when compared with the conclusions of a similar study conducted only two years prior.

The proof of their success is—where else?—in the data.

Understanding customers better is key

Vivo, the leading CSP in Brazil (and an offshoot of Telefónica), once used more than 30 vendors to manually create customer lists for proactive marketing efforts based on the two billion call records generated each day by Vivo’s 60 million customers. That resulted in a glut of ill-advised, poorly targeted and ineffective marketing campaigns.

Using Big Data and analytics, Vivo implemented a solution that combined customer call data, demographic info and predictive modeling to dynamically offer select customers products and services that closely matched their lifestyles and current needs. For instance, the Big Data-driven solution produced lists (in near real time) of customers who had recently exceeded their allotment of prepaid calling minutes. These customers were then immediately and automatically offered a discount for upgrading to a better plan that would eliminate overages.

These types of campaigns can have a notable influence on sales, provide almost instant feedback to a company’s marketing team and even allow for midcampaign adjustments based on initial results. In some cases this process has led to the extension of holiday offers that have been particularly successful.