Bridging the divide between CSPs and the digital generation

This summer, the rise upon rise of Pokémon Go highlighted the massive market of mobile services to teenagers and young adults. Within just weeks, the game had amassed as many as 45,000,000 users – with the promise of catching their favourite Pokémon for some taking priority over safety considerations with the number of reported injuries piling up.

While this is perhaps the first time we have seen a virtual reality application adopted on such a mammoth scale, it is by no means the only new tech phenomenon affecting the telecoms industry. And wearables continue to boom, with research from Mintel estimating that that 3 million wrist-worn wearable devices, such as smartwatches and fitness bands, were sold in the UK in 2015, a massive leap of 118 per cent from 2014 unit sales of 1.4 million.

This is only the beginning, young people have already demonstrated themselves to be a digital generation. A recent survey of 15-18 years old commissioned by Amdocs found that 78 per cent of respondents would like to have an Internet-connected device embedded in their arm, with 38 per cent predicting that it would replace their smartphone.

But despite the significant potential that this young market presents to the telecoms market, both in their mass consumption now and that which is expected from them in the future, this group remains relatively untapped. Indeed, just 12 per cent of teenagers believe that service providers understand their lifestyle and offer services to match it.

Understanding teenagers’ digital DNA

Before service providers can sell to the younger generation, they must first reflect on how teenagers consume and experience the Internet. Appreciating how important mobile connectivity has become to many young people’s lives is an essential first step in understanding their digital DNA. This is not to be underestimated, with over half of teenagers stating that they are more likely to feel anxious and alone if separated from the Internet – indeed, more so than when separated from their family (56 per cent and 52 per cent respectively).

This is perhaps unsurprising when considering how many young people appear to manage and experience a great deal of their social lives through a digital lens. This derives from an always-on approach to social media and chat-apps, with more than half of teenagers checking their social media accounts first thing in the morning. In fact, these internet services dominate to such an extent that over 30 per cent say they would probably not meet someone again if they lacked a Facebook or WhatsApp account.

And when they do communicate, it appears that emojis are worth a thousand words. Almost half of respondents prefer using emojis and posting photos to sending emails, indicating that they found emojis express how they feel more clearly than words.

The manner with which young people consume content also significantly differs to older generations. This is a ‘free content’ generation who love streaming and have no need for ownership: the majority of the young people surveyed stream movies, TV, and just under half stated that they stream music – of whom only a third ever pay for it!

Being a teenage service provider

With young people’s requirement for constant access and connectivity, one might expect service providers would be falling over themselves to sell to this demanding generation. And yet, CSPs just aren’t effectively tapping into it.

In fact, this research suggests service providers have gone further and could be overlooking this market. 30 per cent of teenagers that Amdocs surveyed reported experiencing bad customer service from their CSP over the previous year, with 46 per cent stating that they would not use their service provider again. And with digital experience so integral to teen life, the need to transition to a digital service provider is immediate.

It’s certainly striking that half of teens today already have made a firm opinion as to which service provider they will not use once they have to start paying their own bills. But the problems for these scorned service providers simply don’t end there. For while CSPs might disregard the immediate impact that disengaging young people might have on their business, the digital-savvy nature of this generation can wreak havoc around the brand’s perception.

Indeed, given their influence on paying parents and with the potential to reach a vast audience through their prolific use of social media, the fall out may be far greater than first perceived.

Improving teen affinity to your brand

Teenagers are not necessarily a ‘too hard to please’ market, as some might argue, and their needs should certainly not be disregarded as such. An interesting finding in Amdocs research into teens’ experience of CSPs shows as much.

Of those surveyed, the great majority know who their service provider is – as might be expected. What is more telling for measuring the brand perception of service providers and the potential room for improvement with this market is when comparing their appeal to over-the-top (OTT) players, including Facebook, Google, and Apple, whom over half of respondents wrongly believed to be a CSP.

Each of the OTT players and internet giants listed above were named as “companies they love” by significantly more teens in the survey than respondents own CSPs. Showing that there’s no vendetta against service providers specifically demonstrates a great potential to adopt an approach to attract and meet the expectations of young people. To tap into this market, service providers need to look into new business models that can improve teen affinity to their brands. CSPs must act now to establish a service that appeals to the digital DNA of the younger generation. Adopting a multi-channel engagement strategy, or exploring new monetisation models to address the demand for free content are just two ways that service providers might do that.

There remains a great divide between CSPs and their younger audience – and with teenagers soon to be bill payers, and more engaged with connected services and devices that will undoubtedly increase Internet consumption - this is a market that no service provider should overlook.

It’s important that CSPs examine at young people’s digital DNA and offer this audience a service that matches their behavioural requirements. Whether or not service providers will succeed in this will determine their ability to remain central and relevant in future societies and economies.

Vincent Rousselet, VP, Market Insight and Strategy at Amdocs

Image source: Shutterstock/View Apart