Telefónica Spain

VantageCloud on Google Cloud unites analytics and data for human connections.

Telefónica logo

For many companies, product differentiation is the path to growth and profitability. Yet, product differentiation can be fleeting. 

For example, early providers of Apple iPhone devices or the first to deploy 5G networks led to short-lived differentiation for telecommunications providers. So, what’s a company to do when operating in a commodity-based category? Competing on price may lead to a race to the bottom. Companies can invest heavily into advertising in hopes of creating image and reputation differentiation; but those efforts are hard to measure and shouldn’t be done alone. The reality is most turn to a services differentiation strategy. The best commodity market players deliver value across the customer’s value chain. Consistently delivering quality experiences by optimizing customer support-facing functions like call centers, technical support, and personalizing services and offers lead to a stronger value proposition in the market. These commodity leaders increase loyalty while reducing churn, creating more revenue per customer (ARPU).

Telefónica Spain is the leading telecommunications company in Spain by access, including voice, data, television, and internet access services operating under the Movistar and O2 brands. Its mission statement brings services differentiation to bear --“at a time when technology is more present than ever in our lives, we cannot forget that the most important connections are human connections.”

The operator is breaking out of a generic communications category by shifting value creation to the consumer needs for an increasingly digital life. Using cloud, data and analytics, and automation, Telefónica Spain’s customer-centricity is resulting in a double digit increase in Net-Promoter Scores year over year and an industry-leading churn rate well under average.

Reversing the Commoditization Trend with a Digital Transformation

Telefónica is undergoing its largest digital transformation, recognizing it’s not enough to anticipate the future but it must create it. To do so, the telecommunications provider must respond to consumer needs, foresee changes and shifting behaviors, and be ready to act on market shifts.

Head of Big Data Architecture and Governance, Ignacio Charfolé puts it into the context of their customers, “Since telecommunication services are, more or less, a commodity, differentiation comes through loyalty rates. We need to have a good experience for consumers, so that they prefer us over another commodity player. We see customer experience as being in the middle of everything we do in the commercial setting.” By adding new capabilities and treating technology as a source of value creation, Telefónica is achieving growth through price actions, NPS, churn management, and the best value proposition in the market.

It's not without its challenges. As Charfolé shares, Telefónica’s customer-base has changing behaviors. “They’re demanding very personalized services. We are moving beyond everyone receiving the same communication, via the same experience, with the same offer. Because the customer is demanding personalization and real-time engagement. The only way to do that is with data.”

As the leading telecommunications provider, there’s no shortage of data for real-time decisioning to innovate and grow revenue per customer effectively. Integrating data across omnichannel customer interactions (for example web, call center, and mobile) facilitates Telefónica’s ability to build, test, and model complex predictive analytics across its enterprise is a game changer.

“We have more than one million queries per day, even close to two million queries per day. With more than 200 different sources of information, it amounts to petabytes of data being ingested and formed every day, so that the 1,000 business users, analysts, and data scientists can launch their queries that help make business decisions,” explains Charfolé.

Best-in-Class Analytics Scale Real-Time Decisioning for Customer Experience

With data from all the parts of the company, analytics help Telefónica Spain be more efficient in processes, sell products to its customers, and make better use of its data. Telefónica Spain uses Teradata ClearScape Analytics for real-time decisioning for Next Best Action, and even Speech Analytics of its customer service and call centers, to deliver a memorable customer experience.

Charfolé shares that predictive customer analytics lead to greater customer value. “You need to understand their behavior and be one step ahead of their needs or issues. We use analytical models for Next Best Action to provide recommendations in real-time using the most relevant real-time data. The intention is to offer the most suitable product, communicate the right message in our call center, or simply to take care in the consumer’s unique needs and situation.”

To have that level of personalized treatment demands rapidly rolling out AI and ML to streamline business processes and scale. ClearScape Analytics operationalizes model development with the most robust in-database functionality to solve complex problems.

“Every time that the consumer contacts us, for example on our website, their clicks are analyzed to help determine what to offer up on the next webpage. It also changes depending on the last behavior of the consumer. To be so focused on that consumer, all the behaviors and actions must be ingested and then integrated to use it in an analytical way,” continues Charfolé, “Teradata VantageCloud on Google Cloud is the platform that helps us to integrate all this information together and to build a customer view.”

Telefónica Spain sees real business benefits when creating personalized communications and offers, and memorable customer experiences.

As evidenced through its increasing Net Promoter Scores, industry-leading lowest churn rates, “a happy customer means more loyalty and that directly affects the revenue per customer. That’s why we continually test and adjust the value of our models so that our next best action efforts are always improving,” shares Charfolé.

All this, respecting at all times, the will of the client regarding the use of their personal information, consent, and the GDPR standard.

By leveraging new technology capabilities, Telefónica’s mission of recognizing that the most important connections are human connections, applying speech analytics brings new insights for business decisions beyond the direct call-center interactions.

Charfolé explains that there is a lot of information and insights to be had, “not just in the unstructured text data itself, but within the data. The way that the consumers speak; the rhythm. There's a lot of information hidden in that. Analytics help us to extract this value and to use these insights to further inform next best actions and offers. Because when you integrate all this data about the consumer, the value becomes much greater. This not only helps to position new products or services, but also helps improve NPS.”

Streamlining Business Processes in the Cloud Enables Superior Innovation, Easy Integration, and the Lowest TCO

As part of its digital transformation, Telefónica Spain is harnessing the cloud for the flexibility to test and trial new offers, messages, and services without risk to infrastructure costs.

“Everything is moving to the cloud. All new systems and services will be in the cloud. The real way to be efficient and to reduce the bottlenecks is to be in the cloud,” Charfolé describes.

According to Charfolé, Telefónica sees three primary benefits by moving to the cloud. “One, the cloud is more elastic. It lets you scale up and down automatically. Second, it’s more efficient and increases our capabilities. Third, our business needs to have a very open platform that can connect efficiently and directly with the rest of the cloud ecosystem.”

Teradata VantageCloud on Google Cloud simplifies and modernizes Telefónica Spain’s tech stack to streamline its business processes and scale to demands. 

“Every time that we improve our business process, every time that we have a good recommendation and with a better customer view, Teradata is in the middle,” shares Charfolé, “It's a very demanded analytics and data platform with very important decisions running on the platform. The only solution that helps us to reduce the risk to zero was Teradata VantageCloud on Google Cloud.”

Optimized for cloud and enterprise data needs, Teradata enables superior innovation, easy integration, and the lowest cost TCO to drive exceptional performance.

Teradata’s Native Object Storage (NOS) connectivity with Google Cloud Storage supports harmonizing data through ingesting data into cheaper cloud storage that optimizes TCO. Charfolé describes, “the new NOS capability with Teradata helps us a lot just to easily store and access data centrally into the cloud. It can be ingested directly to VantageCloud, which helps us to be more open and efficient, saving time and energy in other options.” 

The open analytics and data platform provides the access Telefónica Spain needs to seamlessly manage data in a safe environment, control cloud costs, and extract increasing value over time. With unprecedented performance, accuracy, and efficiency in the cloud to improve speed-to-market, Telefónica is turning its mission of the most important connections being human connections into a reality. 

“Every morning, our data analysts and data scientists need to have the data that is accessible, ready to use, and of high quality. Since data is in the middle of everything, every time that we have new data, we know the customer better. And fortunately, Teradata is the platform that helps us to integrate all this information all together to build a customer view,” illustrates Charfolé.

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