Beyond the Generative AI Hype: Transforming Telcos through Hyper-Personalized Experiences
The Challenge
Telcos across the globe are embracing digitalization to create new revenue streams, enhance customer experience and bring operational efficiencies. The advent of 5G and Generative AI technologies provides Telcos with a unique opportunity to transform from conventional network operators to digital and fintech service players. Taking advantage of this opportunity is important, but it’s essential to know how to apply this technology effectively to improve business outcomes rather than getting caught up in the hype.
The Opportunity
Customer segmentation based on common characteristics, behaviors, or preferences using heuristics-based and semi-supervised machine learning (e.g., ensemble methods, clustering, label propagation) is tried and tested in this industry. Personalization through segmentation involves sending relevant offers to a group with common attributes rather than highly individualized content and is often delivered reactively through marketing campaigns or tailored services. However, the key to enhancing customer experience requires hyper-personalization, which involves real-time recommendations tailored to each user’s unique usage patterns, past interactions, and preferences.
Interestingly, traditional segmentation and hyper-personalization can be combined to drive business outcomes efficiently. For example, a segment of customers who show a preference for streaming music services such as Spotify or Apple Music can receive hyper-personalized recommendations within the app, aligned with their segment’s preferences.
In this context, Generative AI’s ability to capture intricate customer behavior patterns and identify novel segments becomes a cornerstone for creating compelling and hyper-personalized digital experiences. The digital transformation from “Telco” to “TechCo” depends on delivering highly engaging experiences that drive adoption and engagement of new digital and fintech services such as media streaming, self-care, or mobile wallets.
For over a decade, Telcos have applied traditional AI to predict churn, next-best offers, and targeted recommendations. However, generative AI, based on principles of novel data synthesis and distribution modeling, has a unique advantage. It brings the ability to capture intricate customer behavior patterns and identify novel segments, enabling the Telco to enhance digital engagement in real-time.
Generative AI enables joint distribution modeling by synthesizing insights from data across multiple touchpoints, such as digital service usage, social media engagement, promotions, offers, and care channels. By adding dynamic interactions with fintech services such as mobile money, micro-lending, payment gateways, and digital wallets, Telcos can create a rich fabric of dynamic customer profiles to offer curated experiences at every touchpoint.
The Catalyst
A hybrid cloud Telco data fabric that combines Generative AI and traditional AI is best suited for operators seeking to leverage this opportunity. Imagine being able to train these AI models on the latest Amazon EC2 P5 instances powered by NVIDIA H100 Tensor Core GPUs and deploy them on-premise for real-time inference, leveraging existing on-premise infrastructure for compliance, privacy, and security.
This data fabric creates business semantic layers from raw data with predefined calculations, aggregations, hierarchies, and rules. Business users can define terms, metrics, and relationships aligned with their telecom domain knowledge. This lays the foundation for understanding customer behavior across digital services and fintech offerings, allowing telecom operators to craft a real-time 360-degree view of customers.
This AI-infused data fabric is a real game-changer. It comes from the Telco’s unique position, which allows them to gather information about user behavior across various digital services. Thanks to this AI-powered approach, Telcos can gain a deeper, real-time understanding of their customer’s preferences and needs in a way that’s truly hyper-personalized and dynamic.
The Outcome
With hyper-personalized behavioral intelligence in hand, Telcos can orchestrate engagement and craft experiences with finesse. Micro-segmentation and hyper-personalized targeting emerge as powerful tools, allowing Telcos to tailor experiences to minute and dynamic customer clusters. Generative AI comes to the forefront in this endeavor, excelling at identifying intricate behavior patterns and unearthing novel segments that traditional AI is unable to uncover. This analytical capability is central to shaping experiences that resonate profoundly with individual users, driving engagement and satisfaction.
This evolution isn’t merely a shift in strategy; it’s a transformation that hinges on the creation of an ecosystem where customer insights fuel a thriving network of tailored experiences that span super-apps, digital services, and fintech offerings. The hybrid-cloud telecom data fabric acts as a perfect ally in this journey, leveraging the capabilities of Generative AI and traditional AI to extract unparalleled value from telecom data.
The convergence of Generative AI and the Telco’s unique data fabric architecture heralds a new era. However, it requires highly skilled operators to yield high-quality business outcomes. It has the capability to redefine the role of Telcos in the digital landscape, catalyzing hyper-personalization and amplifying engagement through a world of tailored experiences.
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