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How addressing early-life failures with proactive AI can grow telco profits
by Jordan Street

By and large, the telco industry does not do a very good job of keeping customers happy. In 2021, Ofcom found the average broadband ‘recommend a friend’ score was ‘4’, placing only just inside the ‘good’ category. The average NPS score – the score used to measure customer loyalty, satisfaction, and enthusiasm towards a company – for telcos in the UK is 28. Scores above 50 are considered ‘excellent’.

As an industry, broadband lags behind consumer retail brands, education, car manufacturers, and healthcare.

The result is that the industry faces churn rates of 30-35%. Out of the 67 million consumers in the UK, that means at any given time 20.1-23.5 million are looking for better options elsewhere.

It doesn’t take much digging to discover why. Half of all telco customers have experienced some kind of issue with their broadband provider in the past year. Frequent signal drop offs (17%), slow speeds (15%) and router issues (15%) are the top three complaints.

While conversational AI can’t solve these issues, it can make them less frustrating for your customers. This is particularly important in the early life of a consumer. Here, we look at how AI can protect against early-life failure, resulting in increased customer satisfaction and long-term profits.

Stamping out early-life failure

Early-life failure can be devastating for telcos. If your technicians miss an install appointment or if a customer is forced to reschedule, the chances of them cancelling altogether skyrockets. In the early days of a new contract, telco customers pay particular attention to their service. If they’re facing outages or slow speeds in this crucial early period, the effect of negative experiences on their overall satisfaction levels is compounded.

Customers do not tend to give second chances either. 72% of consumers will switch brands after just one bad service experience. Conversational AI can provide a safety net to ensure that any poor experiences are promptly addressed. Messages sent via text and email before your customer gets in touch can make them feel understood and valued.

AI and customer satisfaction

To properly protect against slow speeds and outages, telcos need to invest in hardware and infrastructure to keep customers with them for longer. But, against a backdrop of rising costs and inflation, these initiatives are riskier than ever before. Inflation is eating telco profits, despite consumer price hikes of up to 17.3% this year.

The culture of switching and haggling has made any real profit rises tough in recent years. While half of Brits claim they would rather stick with an existing mobile phone contract, even if an alternative would be cheaper, analysis revealed that a saving of just £10.64 a month is enough to steal even this most loyal group away. There’s also the risk that increasing prices could phase people out altogether. One million people in the UK have already switched off their services due to the rising cost of living, according to Citizens Advice.

So, if you can’t stretch prices on existing services, the focus must be on expanding the number of products they have with you. This is only possible if customers are satisfied with the service you offer.

Utilising proactive conversational AI is a cost-effective way to start increasing customer satisfaction. We see it is particularly effective when used in early customer life – when the customer is new to your service and starting to learn more about what you offer. It is particularly useful in issue resolution – such as scheduling a home technical visit or resolving connection problems. ContactEngine projects have seen NPS uplifts of 38-55% among telcos.

Growing long-term profits

Recent analysis has found 20% of telco customers are responsible for a 40% drag on profitability, while the top 25% are responsible for 65% of profit. Focusing too much on acquisition without thinking of overall customer loyalty and growth is sapping the life from telcos. It’s worth remembering that it can be up to five times more expensive to acquire new customers than to maintain your existing base.

Conversational AI can detect when customers are at their most satisfied and therefore when they are most likely to take up a new offer. By moving from a model where you are only hearing from your customers when they have issues to one where you are speaking to them more regularly about their service, you can gain an understanding of what is important to them.

As you use AI to address issues, your customers will become happier and more likely to spend more in future. 69% of customers will spend more on a company that has good customer service.


Early-life failures are a massive threat to telco profits. They can make the difference between a loyal customer being with you for years – and growing their spend with you along the way – and one that is out of the door at the first possible opportunity.

Having ongoing conversations with your customers using AI during this crucial early period is critical for ensuring their journey goes smoothly. Once they are up and running, you can use it to gather ongoing feedback and subtly prompt them to grow their spend with you.

Protecting and growing profits is simply not possible through price rises alone. Telcos need to invest in the service they offer to deliver on what their customers expect. Conversational AI can add value to your service while reducing costs from missed installs and unhappy customers leaving.

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