Vecta Labs News

The impact of Network Quality on Churn in Telecoms

“Customers demand effective, dependable, and extensive network coverage and they will go to any lengths to find a service provider who can meet their needs” – From Retention to Revenue: How to Reduce Churn Rate in Telecom Industry, MaxBill, March 31, 2023

In 2023, research studies have highlighted that customer retention rates have decreased significantly in the telecommunications industry, with a deep dive report published in the PLOS One research journal titled Churn prediction in telecommunication industry using kernel Support Vector Machines found in 2023, 20-40% churn is the industry standard. 

Anyone working in the industry is likely to understand the importance of customer retention and cost per acquisition, with experts citing that to attract a new customer as a network provider, you will likely be spending between 6-7 times the amount of money as you will to retain a customer. 

In a nutshell, high levels of customer churn make for a costly business model.  

According to MaxBill, citing a new study from KPMG, poor network quality is the number one reason for churn – in fact, poor network quality was cited as a factor in around 45% of smartphone user churn. 

Further, data from the 2022 State of Customer Churn in Telecom report highlights that poor customer experience with a telecommunication or network provider has seen user loyalty drop by 22% since the pandemic. 

Considering this new data, General Manager, Vecta LabsDarren Webster explained that a major consideration for Mobile Network Operators is the reduction of churn and subsequent subscriber acquisition cost (SAC).

“It is well known that there are many factors that influence churn, including mobile number portability, the economic climate, pricing plans, promotional activities, product availability and network Quality of Service (QoS). 

“Here at Vecta Labs, we are primarily interested in QoS as it relates directly to network quality. Though there is no universally agreed method of correlating QoS to churn, there are many studies which discuss the negative impacts that Network Quality has on churn (as identified above). Our focus, via qualification, pre-installation, and sector assembly testing is to ensure that Mobile Network Operators are building the best network, the first time. 

“We also provide cellular site remediation and repair services when the network is not providing adequate QoS,” Darren said.

For more information and to understand how Vecta Labs can help you improve your mobile network quality, please get in touch –