ADVISORY CASE STUDIES

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In one of the portfolio countries of a Mobile Telecom Group, the regulator was starting discussions on allowing MVNOs enter the market.

The local mobile operation asked for support to devise a potential MVNO approach. The operator’s requests included involvement in assessing which strategy to follow towards MVNOs, identifying their associated costs and benefits, and understanding the background of operators that embraced a challenger in the market with that model.

Delta Partners led the strategic assessment and specifically delivered:

An assessment of the market, client situation, and growth potential in the market

A specific strategy towards MVNOs

A business case quantifying the costs and benefits associated

An action plan to implement the chosen strategy

The MVNO strategy helped the client assess the attractiveness of the opportunity and propose a clear action plan going forward:

The client began preparations for the potential MVNO entry in the market (first mover advantage)

The client started actively engaging with the regulator

A clear regulation framework was designed favouring MVNOs, leaving no room for a new mobile greenfield network operator

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Client obtained a new mobile license in a GCC country with the objective to enter a highly penetrated duopoly market focused on value creation maximization and customer excellence. Delta Partners was asked to support the client in the start-up of its mobile operations.

Delta Partners start-up engagement was structured across the following main work streams:

Launch office / project management of the commercial and technical areas including business simulation and friendly user testing

Market entry strategy definition and business planning

Interim management support in commercial and technical areas

The client’s commercial launch was very successful:

Considered the best performing 3rd entrant in terms of subscribers acquired during the first month of operations in a highly-penetrated market

Achieved 2M active subscribers after 4 months, over performing 6 times the budget

Sustained healthy ARPUs, exceeding budget targets

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The 2nd mobile voice player in an Eastern European country had recently been merged with the 2nd broadband and fixed voice player in the country. They also owned a license to deploy DVB-TV services. As a result, the company aimed to become the first real 4-play in the country, objective to be achieved through the re-launch of the new, integrated company.

Delta Partners was asked to define the new integrated offer, as part of the whole re-definition of the new value proposition for the resulting entity:

New pricing structures (Stand-alone products, dual plays, triple plays and quadruple plays)

Launch promotion – Both for residential and business segments

3 months after the project, the client launched with the new packages, pricing plans that Delta Partners had proposed

Launch promotion was very successful and the client managed to meet initial targets

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The main client activity was related to military and telecom industries in KSA both in ICT and manufacturing businesses, however, the ICT services business had not been properly developed by the client

A sister company was completely focused in the ICT business, however, the company did not have the capabilities and content to grow in the industry

Delta Partners was engaged to understand the potential of the ICT market in KSA and define strategic guidelines to start an ICT business:

Detailed ICT market sizing exercise

ICT business model assessment of both companies defining overlap/complementary activities

Definition of alignment model between them and financial model implied

Implementation guidelines of the alignment model

Alignment between both company and sister company, maximizing synergies and efficiency to address ICT business and increasing the top line

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The Telecom group operated in several emerging markets where acquisition was still important, but markets were becoming more competitive leading to lower value customers entering the base. Customer value was being lost mainly driven by growing churn and customer inactivity levels.

A consistent approach for all operations was required to help understand the customer base and implement Customer Value Development initiatives while critical customer value development capabilities needed to be built.

Given the complexity of the assignment, Delta Partners took the following approach:

Assessment of the operational readiness for CVD for each of the operations

Agreement on common CVD methodology with Group and local management

Implementation of common CVD methodology including CVD capabilities, system requirements and processes across different operations

Execution of a customer base scan to identify priority areas to launch “quick-win” initiatives targeted at churn reduction, ARPU improvement and cost optimization

A consistent CVD methodology was initiated and local capabilities (organization, systems, processes, etc.) were built for a sustained customer value management. Additionally several “quick-win” initiatives launched were able to generate tangible results:

Increased revenues by 3% through segmented BTL campaigns targeted at usage stimulation

Reduced churn rate by 17% through dealer commission adjustment

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An operator in Africa had been exposed to intense and increased competition impacting negatively its key KPIs:

Revenues were not following a solid increasing trend

Net adds were decreasing in an acquisition market

Delta Partners was engaged to reverse the negative trend and set clear guidelines on the way forward

Delta Partners proposed to first carry out an in-depth analysis to identify the root causes and to then devise a concrete action plan to correct the trend

Competitive market and positioning assessment along all value proposition elements

Customer base analysis

Redefinition of desired market positioning including elements such as vision & mission, strategic objectives and strategic guidelines for all functional areas

Identification and development of measures and actions to achieve the desired positioning and to revamp the value propositioning

Design of a communications campaign accompanied by the launch of targeted products, price plans and promotions

Client was able to successfully reposition itself with help of the revamped positioning, value proposition, the launch of new products, price plans and promotions and the refocused communication campaign. And the client managed to reverse the downward trend showing significant improvements:

100% increase in gross adds

40% increase in usage and 25% return to activity of dormant customers

12% of increase in revenues

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Poorly penetrated 2-player market where the client had 60% market share and where two new players were expected to enter the market. The “pull” distribution model based on many dealers/ distributors and no regional segmentation of distribution as well as a ‘barely’ managed retail channel

Delta Partners was asked to support to tighten control over its sales channel:

Differentiation between distribution & retail roles, categorization of POS according to target segments and performance

Expanded capillarity into new areas

Regionalisation of sales structure

Enhanced logistics function

Enhanced training and communication to leverage the channel

New commissions enhancing activation

Strengthening of the client’s sales channel has helped him drive market growth

From 6% to 13% penetration rate in less than 1 year ...

... while maintaining a dominant 45% market share in a much more competitive market environment with 4 players

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The client had considered for some time the potential of sharing and potentially externalizing its towers. The group management needed to get a better understanding of the key elements and drivers of this business model and its potential implications.

The client requested Delta Partners to develop a broad tower management strategy which the telecom group would be able to leverage for its operations.

Delta Partners applied a structured and analytical approach in defining the concept and assessing the business model including financial drivers. Key steps in the approach included:

Definition of the target concept and business model

Understanding of key financials and the size of the opportunity

Getting buy-in of all stakeholders

Agreement on the next steps forward

The project achieved buy-in from key stakeholders and functioned as a basis for ongoing negotiations with other operators.

For selected markets, based on the outcome of the detailed financial assessments done, the telecom group was able to adopt a very clear approach and actions

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The client had acquired several mobile operators in Africa and the Middle East and had integrated them into the Group. As a next step, it was key for the client to set up a centralized Procurement Function at Group level and to define and implement key procurement processes for both Group and local operations.

Delta Partners was leveraging on its extensive experience in business process redesign and efficiency improvement:

Streamline and (re)design of Procurement processes at Group and local level in terms of:

Quality of outputs/ results

Minimization of interfaces/ handovers

Overall process time / delivery speed

Cost efficiency of the process

Implementation of enhanced processes at Group as well as at local OpCo level

Achieve quick wins in terms of savings across different functional areas at Group and local

Successfully designed and implemented Group procurement function and related process.

Quick-wins resulted in $150m savings

Managed to reduce OPEX by 13% and 22% CAPEX

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