Compared to the banking, insurance and food distribution sectors, the telecommunications sector ranks last in terms of consumer sentiment. That’s according to the latest South African Telecoms Sentiment Index, produced by DataEQ (formerly BrandsEye) in partnership with Deloitte Africa.
While conditions have been tough across most sectors in recent years, Gill Hofmeyr, Africa TMT industry leader at Deloitte, notes that telecom operators have had a particularly tough time.
“As data traffic increases, telcos have been scrambling for additional broadband spectrum. The load shedding also had a devastating impact on the industry, driving up operating costs at a time when margins were already under immense pressure,” says Hofmeyr.
Load shedding has increased network stress across the industry
Data provided by EskomSePush confirms that offloading was implemented on a total of 45 days in 2021. According to the index, more than half of those days also saw unusual volumes of complaints on the network, which shows the negative impact of load shedding.
In terms of individual telecom operator rankings, after tracking nearly two million social media posts for Cell C, MTN, Rain, Telkom and Vodacom throughout the year, the index recorded minimal movement in the ranking compared to last year.
Most telcos see year-over-year improvement in net sentiment
MTN extended its lead by producing the biggest year-over-year net improvement in sentiment, while Rain’s rise was not enough to see a change in rankings.
The biggest improvement in reputational and operational sentiment came from Telkom, which saw the partly state-owned telecommunications company climb the rankings to share second place with Vodacom.
Bucking the trend, Cell C was the only provider whose net sentiment deteriorated in 2021, which saw the telecom operator fall one spot in the rankings.
Reputation efforts by telecom operators masked poor customer service
Discussing the improvement in sentiment from 2020 to 2021, DataEQ MD Melanie Malherbe notes that much of the progress was based on the reputation efforts of telecom operators.
“Despite the success of some brand and influencer campaigns, customer experience has remained a major gap in the industry, with consumer sentiment towards this aspect deteriorating year on year.
“Given that the efforts of telecom operators in 2021 did not translate into an improvement in customer experience compared to 2020, this remains a key potential area of differentiation going forward,” adds Malherbe.
As network providers continue to deepen their knowledge of financial services, this year’s index also includes dedicated analysis of telecom operators’ adherence to the Fair Treatment of Customers (TCF) regulatory framework. of the Financial Sector Conduct Authority (FSCA) with respect to their financial services offerings. A poor response to customer conversation in this regard therefore not only impacts a brand’s reputation, but could also pose a market conduct risk.
“Beyond these growing regulatory pressures, the results indicate that telecom operators are lagging the broader financial services sector in terms of consumer sentiment. It will be important for telecom operators to seek to fill these gaps. gaps through better customer service if they want to grow their financial services business,” concludes Hofmeyr.